Batteries for Off-Grid Homes

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Batteries for Off-Grid Homes

Batteries are still expensive, so homeowners are unlikely to be disconnecting from the grid anytime soon

Posted on Jul 29 2016 by Martin Holladay

Is solar electricity cheap or expensive? There are two parallel stories circulating these days. One version of the story — the older of the two — is that electricity from a photovoltaic(PV) Generation of electricity directly from sunlight. A photovoltaic cell has no moving parts; electrons are energized by sunlight and result in current flow. (PVPhotovoltaics. Generation of electricity directly from sunlight. A photovoltaic (PV) cell has no moving parts; electrons are energized by sunlight and result in current flow.) array is more expensive than grid power, and that adding batteries makes PV even more expensive.

The newer tale, oft-repeated on, is that PV is cheap and getting cheaper, and that any utility that tries to limit PV installations is doomed to failure — because homeowners who are disgruntled by a PV-hostile utility will choose to install batteries, cutting the cord to the grid.

Cutting the cord, a move called “grid defection,” is a key element of utility executives' nightmares. The worry is that increasing instances of grid defection will cause utility revenues to drop, precipitating a “death spiral” for utilities.

So, which version is closer to the truth?

In some states, PV electricity is cheap

Here’s my summary: right now, if available tax credits and rebates are taken into account, PV electricity is cheaper than grid power in many areas of the country with generous PV rebates — but only for grid-connected customers.


An Introduction to Photovoltaic Systems

After Lithium-Ion, What?

Tesla Will Sell Home Batteries

New Life for Old Electric Vehicle Batteries

How to Design an Off-Grid House

Are Solar-Plus-Battery Systems Coming to a Neighborhood Near You?

A Bright Future for Solar + Battery Systems in Australia

Running Our House on Prius Power

A First in New England: Utility-Scale Battery Storage

Making Room for a PV Array

When Will Rooftop Solar Be Cheaper Than the Grid?

PV Systems Have Gotten Dirt Cheap

Residential Solar in Nevada Benefits All, Study Says

Maine Completes Value of Solar Study

Solar Energy Can Make the Grid More Resilient

New York Utility Finds Big Payoff in New Ideas

Rethinking the Grid

This Vermont Park Is Going Off-Grid

Why a Vermont Utility Welcomes Solar

How to Live Comfortably Off the Grid

If tax credits and rebates are ignored, PV electricity may still be cheaper than grid power for grid-connected customers — but only in areas of the country with high electricity rates or favorable net-metering agreements.

In areas of the country where grid power is cheap, rebates are stingy, or utilities don’t offer net meteringArrangement through which a homeowner who produces electricity using photovoltaics or wind power can sell excess electricity back to the utility company, running the electric meter backwards., PV electricity probably isn’t yet cost-competitive.

In almost every location in the U.S., the cost of electricity produced by a PV system with enough batteries to permit "grid defection" is significantly higher than the cost of grid power.

Do the math

If you want to know whether PV is a good investment, do the math. You can choose to lease a PV system or buy your own equipment; if you can afford to buy the equipment, you'll usually end up with lower-cost electricity than if you lease.

Once you know the size of the PV array that will fit on your roof (or the size of the PV system you can afford), you can visit an online calculator like PV Watts to determine your planned system's expected annual electricity production (in kWh). With that information, you'll be able to calculate your annual savings as well as the payback period.

Here's the fly in the ointment: if your local utility is offering a favorable net-metering contract, there's no guarantee that the terms of that contract won't change in the future. If you think that such a change is unlikely, it's worth considering the sobering story of the PV-hostile ruling made by utility regulators in Nevada.

So homeowners who invest in a residential PV system have to consider whether they are comfortable with the risks associated with today's net-metering agreements.

Cutting the cord isn't cheap

What about the idea that homeowners can always cut the cord and go off-grid? Well, they can. I’ve lived that way for 41 years.

That said, it’s important to point out that currently available batteries make off-grid power very expensive. And the price of batteries needs to fall a lot more than most people think to make off-grid living attractive to the average American.

The hoopla surrounding the Tesla Powerwall

Now that the price of PV modules has dropped to $1 per watt (or less), the missing piece of the off-grid puzzle is an affordable battery. Has such an affordable battery been invented yet?

A year ago, Tesla issued a press release trumpeting their new lithium-ion battery for homes, the Powerwall. If this press release were a Texas rancher, knowledgeable onlookers would be muttering, “All hat and no cattle.” When it comes to the Powerwall, there is no there there — at least not yet.

The Powerwall is a great product, except for three problems: it’s undersized, overpriced, and unavailable. For the time being, off-grid homeowners will need to continue to rely on one-hundred-year-old technology: old-fashioned lead-acid batteries.

Recently, a few knowledgeable voices have tried to cut through the Tesla hype. In a story on the Tesla Powerwall, Greentech Media quoted Ravi Manghani, senior energy storage analyst at GTM, who said, “Even some of the deep cycling lead-acid batteries offer 1,000 cycles and cost less than half of the $3,500 price tag for Tesla Powerwall. ... For pure backup applications only providing 500 cycles, lead-acid batteries or gensets are way more economical.”

A lithium-ion battery weighs less than a lead-acid battery of the same capacity. That’s a useful feature for a battery that is installed in a vehicle, but it isn’t needed for stationary batteries that are installed in a home's mechanical room.

Lithium-ion batteries may eventually replace flooded lead-acid for off-grid homes — but right now, they're too expensive to make any sense.

Traditional advice provided to off-grid homeowners

Back in 1980, when I bought my first PV module, off-grid PV systems were rare. Within a few years, however, a small industry emerged to serve the needs of off-grid homeowners. Back then, PV retailers — at least the honest ones — explained the battery situation this way:

  • PV modules are great, but batteries are no fun.
  • Batteries are expensive to purchase, a pain to install, and require frequent maintenance (mainly adding distilled water to the cells and cleaning the terminals).
  • Batteries can be easily ruined, either by undercharging or overcharging.
  • Batteries — especially discharged batteries — don’t like to get cold.
  • If all goes well, your batteries will last eight years. In most cases, however, you’ll probably end up doing something wrong and damaging your batteries, and you’ll need to replace them after five or six years.
  • Because batteries are expensive, you’ll never have as much storage capacity as you want or need.

As Dan Fink explained in his “Guide to Choosing Off-Grid Batteries,” an article published in Countryside Daily, “Most batteries don’t die of natural causes; they are murdered. The most common culprits are loss of electrolyte, chronic undercharging, too many deep discharge cycles, corroded connections, and heat.”

While all of these facts are true, so is this one: Lead-acid battery technology is mature and well-understood. When all of the pluses and minuses are added up, lead-acid batteries are still the most cost-effective way to power an off-grid house when the sun isn’t shining.

What if lithium-ion batteries drop in price?

When Tesla’s new lithium-ion megafactory in Nevada begins producing batteries in significant quantities, the price of lithium-ion batteries will almost certainly drop. As some point, a lithium-ion battery may have the same price tag as a lead-acid battery of the same capacity. At that point, PV users may want to cut the cord — right?

Well, no. If the price drops that low, off-grid homeowners may choose to buy lithium-ion batteries instead of lead-acid batteries, because lithium-ion batteries require less maintenance. But off-grid homeowners won’t be able to run their homes on a system consisting of just a PV array, an inverterDevice for converting direct-current (DC) electricity into the alternating-current (AC) form required for most home uses; necessary if home-generated electricity is to be fed into the electric grid through net-metering arrangements., a charge controller, and a battery. They are still going to need a generator with an internal-combustion engine fueled by gasoline or propane.

Here’s the problem: In the northern hemisphere, there isn’t as much sun in November as there is in June. Off-grid homeowners get a double whammy: in the autumn, the need for lighting increases just as the daily output of a PV systems decreases. So what’s an off-grid homeowner to do?

In theory, you could buy a battery bank and a PV array large enough to get you through November, December, and January — until the sun begins to return. But once you start doing the math, you realize that a battery bank that big, paired to a PV array large enough to get you through the winter, will cost tens of thousands of dollars.

Instead of investing in a huge PV array and a huge battery, it turns out that it is far cheaper to purchase a $2,000 generator to help get you through the winter. So that’s what most off-grid homeowners do.

Now that you own a generator, guess what? You're saddled with generator maintenance: oil changes, spark plug changes, air filter changes, and regular trips to the mechanic.

How big a battery do I need?

A rule of thumb for off-grid homeowners is to install a battery that can power the house for three or four days. If we aim for just three days of storage, that means that the typical U.S. home — one using 31 kWh per day — would need 17 Powerwalls, each rated at 7 kWh (assuming that Powerwall batteries can be fully discharged without damaging the battery). Seventeen Powerwalls would cost $51,000 (not counting the cost of the inverter or labor to install the equipment). And the homeowner would still need to buy a gasoline-powered generator to charge the batteries during a four-day cloudy spell.

Of course, a homeowner would have to be crazy to buy $51,000 worth of batteries without considering load-reduction efforts first. In many cases, it’s cheaper to buy a more efficient refrigerator or LED lamps than it is to buy a battery that is big enough to run an energy-hog refrigerator and incandescent lamps — so for off-grid homeowners, it’s wise to buy new appliances and energy-efficient light bulbs before considering the purchase of a huge battery.

Quashing unrealistic expectations

You might think that off-grid homeowners would be big boosters of the off-grid lifestyle. But most of us are realists, not starry-eyed idealists. For example, consider the advice of Ian Woofenden, a resident of Washington state who has lived off-grid for years. In an article for Home Power magazine called “So You Want to Go Off-Grid,” Woofenden wrote, “Going off-grid is possible and practical in many cases. … But many people who toss out the phrase have a fairly romantic idea floating in their minds. They imagine having no utility bill, and energy and life being free and easy. The reality is that most utilities supply electricity at a modest cost, and if you take on their job, you have to play all the roles that the utility plays. …

“Your solar-electric array will give you 30 to 50 years of trouble-free service. Meanwhile, your battery bank — even if well cared-for — will need to be replaced multiple times. And if you don’t treat it well, you may learn a hard lesson of having to replace this expensive component in just a few years. Some RE [renewable energy] professionals suggest that new off-grid systems use a less costly battery bank initially — since there’s a learning curve with battery care and it’s best not to risk ruining an expensive bank while you learn. …

“Take a hard look at your situation before you jump into the off-grid lifestyle. You may find that a grid-tied system will serve your motivations and goals best — at a lower cost and lower environmental impact. If you choose to be off-grid, get realistic, get educated, and get good help.”

Even expensive batteries have a limited capacity

My family now uses a $4,600 battery set purchased in 2011. We have 12 large industrial lead-acid cells; the cells can be wired for either 12 volts or 24 volts. Configured for 24 volts, the battery is rated at 1,576 amp-hours (20 hour rate), or about 38 kWh. If depth-of-discharge is limited to 50% of the battery capacity, as it should, the useful capacity of our battery is reduced to 19 kWh.

In other words, our battery would run the average U.S. house for less than 15 hours before it needed to be charged.

Since our house has fewer electrical appliances than the typical home, and since our appliances are all energy-efficient, our battery has the capacity to run our house for three days or more without any problems. But most Americans would balk at living the way we do: We don’t have a dishwasher, freezer, or toaster; our refrigerator is quite small; and we don't have air conditioning.

Predicting the future

Now that I’ve injected a much-needed dose of realism into the off-grid discussion, I’m willing to paint a more optimistic picture of future developments in battery technology.

I believe there’s a very good chance that within a few years, the price of lithium-ion batteries will reach parity with the current cost of flooded lead-acid batteries. When that happens, off-grid homeowners will probably abandon lead-acid batteries in favor of lithium-ion batteries — especially if the lithium-ion batteries last at least 8 years. (If they don’t, lead-acid batteries will remain the better deal.)

If the price of lithium-ion batteries drops still further, grid-connected homeowners who own PV systems may want to invest in something like a Powerwall. (They may also consider purchasing used electric vehicle batteries, since tired old lithium-ion batteries should be cheap, and may perform well enough in a house to be worth installing.)

At first, these residential batteries won’t be used in the same way that off-grid homeowners use batteries. Instead, they’ll be used for load-shifting — that is, for reducing the use of grid electricity during peak hours. In some cases, grid-connected homeowners who live in areas that offer time-of-use billing may be able to make a little money by charging their batteries at night, when grid power is cheap, and selling electricity back to the utility during peak hours. (In some cases, homeowners with electric vehicles may be able to use their car batteries for the same purpose.)

This won’t happen, however, unless utilities allow it to happen. They should, because these load-shifting strategies will help utilities avoid the cost of building new power plants. The net result will be a win-win situation: a win for homeowners who invest in batteries, and a win for utilities. Utilities are expected to provide enough power during peak periods to keep ratepayers happy — and if there is a way to make that happen without building new power plants, utilities will save money and enjoy higher profits.

Will batteries ever get cheap enough for grid-connected homeowners to happily cut the cord? Perhaps — but only in areas with very high electricity rates and a PV-hostile utility like Nevada’s NV Energy. In most areas of the country, it’s going to make a lot more sense for homeowners to stay grid-connected than to cut the cord.

Martin Holladay’s previous blog: “A Researcher Looks at Insulated Roof Assemblies.”

Click here to follow Martin Holladay on Twitter.

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  1. SBS Battery

Jul 29, 2016 11:51 AM ET

Edited Jul 29, 2016 11:52 AM ET.

+1 "The Powerwall is a great
by John Semmelhack

"The Powerwall is a great product, except for three problems: it’s undersized, overpriced, and unavailable."

Jul 29, 2016 1:25 PM ET

It's a moving target, and the US isn't the target market.
by Dana Dorsett

The economics of batteries (on or off grid) are far better in Germany & Australia, particularly Australia, where the economics can sometimes favor whole towns going off the national grid. Australia is becoming the world's test bed for newer battery storage systems both on & off grid, and some are opting for outright grid defection.

BTW: NV Energy is petitioning the Nevada PUC to retroactively grandfather the existing PV owners for a 25 year period of net metering, and the PUC commissioner who presided over the recent bruhaha has be asked to hit the bricks, and is now going on record with the rationale behind their decision making, in the face of the mounting law suits and referendum petitions:

Jul 30, 2016 4:05 AM ET

Load shifting?
by Skip Harris


You talk about needing more lighting in the winter, when PV output is lower. On the other hand, one can potentially set up a freezer or fridge on an unheated porch so it hardly uses power in the cool season. Alternatively, one could have one that is only used in the summer.

Living off the grid is certainly not something that brings extra simplicity to life, but may appeal to folks who have the time and inclination to do the extra fiddling... or enjoy paying attention to and adapting to current conditions.

Jul 30, 2016 6:12 AM ET

Edited Jul 30, 2016 9:14 AM ET.

Response to Dustin Harris
by Martin Holladay

I've spent a lot of time over the years thinking about ways to use the cold temperatures of winter to store food without electricity. I've learned two things: (a) The problem is more complex than it first appears, and (b) Setting up a freezer or a fridge on an unheated porch is not a good solution in Vermont.

In colder locations -- for example, near Fairbanks, Alaska -- it makes sense to store meat in a cache over the winter. You shoot your moose in the late fall, and you put the meat in your cache, and the meat stays frozen until spring. That works.

Here in Vermont, there are two ways to use low temperatures for food storage. The first is one I use all the time: Build a cellar, and don't install any heating appliances in the cellar. My cellar stays the same temperature as my refrigerator from November to mid-May, and I use it all the time to store food that won't fit in the refrigerator. The main problem with a cellar is that it's inconvenient -- there are many steps from the kitchen to the cellar. I've thought of building a dumb-waiter, but I've never done it.

The second way is to harvest ice from a pond and store the ice in an ice house. This method allows you to keep food cold all summer long, in an ice box located in your kitchen. The method works well -- I've never done it, though, because it's a lot of work.

There are many problems with installing a refrigerator or a freezer on an unheated porch. The basic problem is the range of winter temperatures -- from -40°F to +45°F. This range of temperatures is rough on a compressor and not good for the food you are storing. Moreover, if the unheated porch has no walls, you have to deal with drifting snow -- and if you need an ingredient when you're cooking dinner, you would have to put on your coat, hat, and gloves to visit the refrigerator.

What I ended up doing with my 12-volt Sunfrost refrigerator is to install it in an exterior wall, with the compressor and the coils facing the unheated mudroom, and the refrigerator door in the kitchen. That's more convenient than walking to a porch. The mudroom holds a bit of heat escaping from my wood-heated house, so it is usually above 10°F or 20°F -- the compressor doesn't face temperatures as cold as on a porch. And the cold temperatures of the mudroom help the compressor dissipate heat quickly, lowering my electricity usage somewhat. Moreover, the sides and top of my refrigerator are in the cool mudroom, not my hot kitchen, so the refrigerator "box" stays cooler even during a power outage. (By the way, I don't have power outages, because I make my own electricity.)

Of course, that means that I don't benefit from the refrigerator heat -- the refrigerator doesn't contribute to space heating of my house. But in effect, the refrigerator heats my mudroom a little, which is probably a good thing.

One more point: installing my refrigerator this way helps keep my house cooler during the summer, since the compressor doesn't shed the refrigerator heat into my kitchen.

Jul 30, 2016 8:51 AM ET

You hardy New Englanders are
by Steve Knapp CZ 3A Georgia

You hardy New Englanders are something else. ;-) Down south we starting complaining about the cold when the temperature drops into the 50s.

Aug 4, 2016 3:27 PM ET

In defense of the Powerwall
by Advisor Populus

The points made in this article about the cost and limitations of the Powerwall are accurate. However, this technology's intended purpose is not for off-grid homes. What it actually does is shift energy demand away from the utility during peak usage hours and provide short term emergency storage.

Instead of thinking of the Powerwall as an expensive and unrealistic option for an off-grid home, think of it as a battery solution that allows some backup storage while remaining connected to the grid. The potential for this application is incredible if you understand the role it's trying to fill and how reducing peak demand could greatly aid in the long term adoption and stability of distributed solar.

Their website is also suggests that it's purpose is to supplement and shift energy, not to take homes off-grid -

Aug 4, 2016 3:34 PM ET

Edited Aug 4, 2016 3:37 PM ET.

Response to Advisor Populus
by Martin Holladay

My article made the same point. I predicted that when Powerwall batteries drop in price and become more available (for the time being, availability is very limited), "these residential batteries ... will be used for load-shifting — that is, for reducing the use of grid electricity during peak hours."

If your local utility offers time-of-use billing and allows you to charge batteries cheaply and night and sell the power back to the utility during peak hours, you don't have to wait for Tesla to manufacture enough Powerwall batteries. You could do it right now, with lead acid batteries that cost half the price of a Powerwall for the same capacity.

Aug 5, 2016 6:31 AM ET

Newer battery technologies
by Brian Bailey


Thank you for this article; very timely, as we are just about ready to make the investment for a grid-tied 5kW solar array and small battery backup system.

I would be interested in your thoughts on two battery technologies available now but not mentioned in the article.

"Saltwater" batteries sold under the Aquion name purport to offer 3000 cycles at 100% depth of discharge, and many more if the owner can make do with a shallower DOD. They are made from non- (or perhaps less-) toxic materials are appear to be cost-competitive if lifespan is taken into account. Their only drawbacks: low wattage output (677 W per 2.1kW battery) and thermal sensitivity (the electrolyte can freeze below 23F). In my own research, I initially wrote these off due to cost. After reading your article and doing other research, I think their lifespan potential may make them cost-competitive, they appear to be much less prone to destruction by over- or under-charging, and they present no risk of a caustic chemical spill in the basement.

NiFe batteries, also called "Edison" batteries are sold by a company called Iron Edison. This old technology is expensive and has a high self-discharge rate, but their lifespan is said to be measured in decades and they are capable of high rates and depths of discharge without adverse effect. Their high-self-discharge takes them out of the running for our battery backup application, but their lifespan (on par with the panels themselves) again makes it look like their cost might be justified.

Aug 5, 2016 6:58 AM ET

Response to Brian Bailey
by Martin Holladay

I've heard of the Edison batteries -- similar reports to the one you just made. I have no direct experience with them. After weighing the purported advantages of the Edison batteries with their disadvantages, the vast majority of battery purchasers choose conventional flooded lead-acid cells. This includes batteries for industrial applications (forklifts, standby power, emergency power) purchased by large corporations who do their homework. Flooded lead-acid batteries are tried and true -- definitely the best bang for the buck.

I've never heard of Aquion saltwater batteries, so I won't comment on them, except to say that I've learned over the years that it doesn't pay to be an early adopter or a guinea pig.

Aug 5, 2016 9:18 AM ET

Brian. Did you see this
by Steve Knapp CZ 3A Georgia

Brian. Did you see this review of different off-grid/solar battery solutions?

Aug 5, 2016 1:17 PM ET

Response to Martin and Steve
by Brian Bailey


Indeed, Occam's Razor would seem to apply to off-grid batteries as with most other things - the solution requiring the fewest assumptions is usually the right one.

One follow-up question regarding FLA batteries. I gather these batteries (really, all batteries) prefer to live inside the thermal envelope for optimum performance (read: minimum cost). I also understand that unsealed batteries discharge gasses that one would rather not have floating around in the indoor atmosphere. How do you resolve this tension? Store batteries outside, temperatures notwithstanding? Vent the indoor enclosure to the outside?


Thanks for the link - very interesting. Great to see so much innovation in this important technical space. To Martin's point, my research of our own solar system identifies battery technology as the weak link in more widespread solar/wind adoption at the homeowner level.

Sep 6, 2016 11:25 AM ET

If you have the space, maximize your PV...
by Skip Harris

Given the expense and drawbacks of batteries and the problems with cloudy days, it might be cheaper for folks to oversize their PV systems so that they have enough power, even on cloudy winter days. For the price of a single Powerwall, one can add quite a bit of set-and-forget PV. I've increased the size of my system by 133% and it has made a huge difference in how much a series of dark, cloudy days affects me.

This does require more space, however....

Sep 6, 2016 11:34 AM ET

Response to Skip Harris
by Martin Holladay

You are absolutely right that the dropping price of PV has changed rules of thumb for the best ratio of PV to batteries. Like you, I have increased the size of my PV array, and it's made a huge difference in generator run time.

That said, a cloudy winter day in Santa Cruz, California (for example) is different from a cloudy winter day in northern Vermont. When the sun is barely above the horizon at noon -- when the sun rises at 8:00 am and sets at 4:00 pm -- and the clouds are thick, doubling the size of one's PV array doesn't do much. A cloudy winter day in northern Vermont is very dark indeed.

Two times zero is zero.

May 3, 2017 10:46 PM ET

Aquion Energy voluntarily filed for bankruptcy in March 2017
by Ethan T ; Climate Zone 5A ; ~6000HDD

Aquion Energy voluntarily filed for bankruptcy in March 2017, most likely due to the huge competion and price reductions from lithium battery manufacturers such as LG & Tesla. (per the linked article:

May 4, 2017 6:42 AM ET

Response to Ethan T
by Martin Holladay

Thanks for the information. I guess that means that I don't have to get up to speed on the advantages and disadvantages of Aquion batteries -- a product I had never heard of before the company was mentioned by Brian Bailey. (One less item of homework to worry about...)

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