Morgan stanley_ battery storage to grow four times quicker than market thinks _ renew economy

Leading investment bank Morgan Stanley believes the Australian energy market is seriously underestimating the grow of solar and battery storage, and says the technology will be installed at rates four times quicker than the incumbent energy industry expects.

In a new detailed report, Asia Insight: Solar and batteries, Morgan Stanley expects the market for battery storage to grow from about 2,000 Australian homes now to one million by 2020. Gas oil ratio 50 to 1 But its “high case” suggests the take-up could be double that – up to 2 million homes by 2020.

“We think most incumbent utilities downplay the earnings risks from solar and battery take-up, and the market has not yet priced in the retail and wholesale market effects,” the company analysts write in their report.

The findings of Morgan Stanley are almost diametrically opposed to most in the industry – the incumbent utilities and regulators included. National gas average 2012 It admits itself that its estimates are by far the most aggressive on the “street” (meaning investment banks).

Last week, t he Australian Energy Market Operator predicted 6.6GWh of battery storage in Australia by 2035. Electricity use That’s the figure that Morgan Stanley says will be reached by 2020, although AEMO’s trajectory corresponds with Morgan Stanley’s “low uptake” scenario.

Most utilities still downplay battery storage as a “medium term” opportunity, saying the “payback” would not occur for another five years at least. Electricity tattoo designs Some say 10 years. Electricity flow diagram One s tate regulator even refused to consider battery storage in its current regulatory approval because it didn’t think the technology “had arrived”.

Morgan Stanley last year released a ground breaking report that provided one of the most optimistic outlooks for battery storage in Australia, which is considered to be a testing ground for the world because of its high electricity prices, excellent sunshine, and its high number of solar households.

That is one reason why the likes of Tesla, Enphase, and Redflow are using Australia as the launch-pad for their global products, and numerous other battery storage and software developers are targeting the country, including Samsung, Panasonic, Sonnen, Ecoult, Reposit, and Redback.

Morgan Stanley said then that it thought 2.4 million households would adopt battery storage. Gas apple pay It says that after another year of assessing real world products, costs, tariffs (and tariff directions), business models, and another of its commissioned surveys on consumer behaviour, its belief has been reinforced.

This is despite the fact that its survey (right) points to a slight decrease in the number of people interested in battery storage. Gas nozzle icon But it puts that down to a lack of knowledge about battery storage costs.

Morgan Stanley believes that the solar market will remain strong, that electricity tariffs will remain high and that consumers will be attracted to the battery storage technology.

Battery storage installation costs, Morgan Stanley believes, are likely to fall by 40 per cent within two years, and changing business models and tariffs mean that these could be revenue positive by that time. Chapter 7 electricity and magnetism ( We go into this in more detail in this article here).

That 40 per cent fall is likely to trigger the start of the “mainstream” market in 2018, a “tipping point” for the market that is expected to double the following year as costs fall further, more retrofits on existing solar systems occur and as consumers start to access payments for network services.

The potential for these network services, such as dealing with peak demand and avoiding network upgrades, are already being recognised by numerous trials being undertaken in Queensland, Victoria, South Australia, and Western Australia.

Morgan Stanley believes that the impact on retail earnings for Origin and AGL could grow to $50-90 million in fiscal 2020, as households use less electricity from the grid. Electricity grounding works Wholesale prices will also remain flat as battery storage flattens load shapes, meaning less peak pricing.

The bank congratulates AGL and Origin for their “New Energy” strategies which focus on providing solar and battery storage to their customers. Gas national average 2009 It says they are targeting the “easy adopter” market – customers who want to adopt new technologies, but who want a trusted retail brand to provide a professional sales experience, and stand behind the installation.

But it says this strategy is more about reducing customer retention costs than creating earnings growth, which is why it has only modestly trimmed its earnings reduction impact from last year. Gas in oil car T

It has even downgraded AGL Energy on the basis of its forecasts – to underweight from equal weight, citing flat demand, the growth of battery storage and new entrants, and more renewables as key factors. Gas relief for babies home remedy It says while AGL and Origin are pushing into solar and storage, it will not be enough to hold revenues, only reigning in customer retention costs.

“Rooftop solar (with or without batteries) is a direct substitute for grid power, and we think the industry response is at best a defence strategy, not a driver of earnings growth,” the analysts write.

“Put simply, the retailer might gain ~A$400/customer from sales, financing and reduced cost-to-retain, but lose ~A$400/customer per annum in lost grid energy sales.

“We think the impact of solar and batteries will play out in a slow and steady fashion over time until reaching a tipping point in the next few years, showing up as unexpected drops in electricity demand (e.g., hollowed out load duration cures) and lower average wholesale electricity prices and caps (which reflect volatility).”

Part of it could be technical issues and installation problems, an issue widely recognised by the industry who fear that lack of standards, and the entry into the market of “cowboys” and cheap and low quality gear could cause problems. Electricity kwh cost One “ thermal runaway” event (otherwise known as a fire), could affect public confidence and interest.

It notes also that cost savings could be eroded because of a slow response by pricing regulators, and policy regulators may also be slow in introducing a a number of rule changes needed to facilitate some of the battery applications.

Thank you for all your replies. T gasthuys I am glad that there has been some serious consideration of this overlooked method of energy storage which could open the way to extensive energy independence for energy users in the cooler parts of Australia.

[1] Storage operating temperature range of 90 C max to 45 C min. Electricity lessons ks1 The maximum temperature is set by the boiling point of water and the maximum temperature setting of the available tempering valves in Australia. Electricity facts history Operation below boiling point allows an unpressurised tank (open to the atmosphere) and the possibility of home construction. Origin electricity faults A tempering valve allows the piping and radiators in a space heating application to operate at a safe temperature without reducing system efficiency in any way and is also required in a domestic hot water system for the same reason.The minimum temperature of 45 C is set by the need for a temperature differential between the radiator and the desired room temperature to drive heat transfer from radiators (hence limiting the physical size required) and the minimum usable temperature for domestic hot water.

[2] Specific heat of water is 1 calorie per gram per degree C which translates to 1.16 kWh/m^3 per degree. Power energy definition For a temperature range of 45 to 90 C, multiply 1.16 by (90 – 45) = 52.3 kWh/m^3 and round this down to 50 kWh/m^3. Gas variables pogil packet answers Actually if space heating at a room temperature of 20 C is the only use then the factor (90 – 45) becomes (90 – 20) giving in excess of 81 kWh/m^3.

Of course, one should endeavour to insulate one’s ceiling, walls and floor as well as possible as a first step, to avoid the need for heating energy in the first place. Natural gas in spanish With a well orientated house on a sunny day this may avoid the need for any space heating until late at night. Electricity notes pdf However, winter typically brings a few periods of up to a week of cold sunless weather which will overwhelm most people’s storage provision (particularly if only batteries) so in practice, complete electricity and gas grid independence is some way off yet.

The cost of running a hot water energy storage system is the incremental cost of solar energy (free!) plus the small cost of the electricity to run whatever pumps are required to move the water from the storage to the end use (which could again be solar energy and come from a small quantity of batteries). Gas and supply okc The capital cost of any heating system is the purchase price plus the fractional cost of replacing the system at end of life plus the opportunity cost of alternative uses for the money. Electricity prices going up All this cost must be compared to the cost of paying for another form of heating, calculated in a similar manner.

It is a mistake to believe that one should seal up one’s living spaces completely. Gas house edwards co You need a complete change of air in occupied rooms about every three hours. Electricity grid australia Regenerative HVAC ventilation systems to allow scavenging the heat content of stale air are currently a bit expensive and take up considerable space so it may be cheaper and easier to simply discard this energy content. O gastronomico Nevertheless, home-made air to air heat exchangers are definitely possible and economical. Gas vs diesel engine Heat exchangers to cool incoming air in summer are also possible but you will loose considerable energy condensing the water vapour which the newly cooled air cannot hold.