German Home Battery Demand Pushes Storage Above 5 Billion Euros

(Bloomberg) -- Homeowners tapping cheaper batteries for rooftop solar installations helped Germany’s power storage market break through the 5 billion euro ($5.6 billion) mark for the first time last year.

The market, which includes utility-scale batteries and home units, is growing by 10 percent a year, driven by a sharp decline in technology prices, Germany’s BVES storage federation said Tuesday. Falling module and battery prices are encouraging consumers to cut their power bill by generating their own electricity.

German Home Battery Demand Pushes Storage Above 5 Billion Euros

About 125,000 German homes installed batteries made by companies including Senec GmbH, Sonnen GmbH and Tesla Inc. The cost per kilowatt-hour of generating solar power range from 10 to 12 euro cents a kilowatt-hour compared with average costs this year of 30 cents a kilowatt-hour for power from the grid, according to the BSW solar federation.

German Home Battery Demand Pushes Storage Above 5 Billion Euros

Still, the growth rates for both retail and utility-scale storage should be faster to meet soaring demand, according to market observers including BVES and BloombergNEF. Electrification of transport and heating are driving consumption and grid strains are increasing with the expansion of wind and solar power.

Even with home battery subsidies worth as much as 5,000 euros, a typical amortization period of 12 years for new retail solar investments in Germany is too slow to foster a boom in sales, BNEF said this month in a report. That’s still better than in the U.K., where payback periods can last as long as 23 years.

German Home Battery Demand Pushes Storage Above 5 Billion Euros

The market in Germany for industrial-scale power storage stagnated in 2018 as prices paid by grid operators for balancing services dropped due to saturation of the market, BVES said.

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