Will Energy Storage Plus Solar Inspire Customers to Abandon Utilities?

- by Lisa Cohn, February 28, 2014, Energy Efficiency Markets

[[{"type":"media","view_mode":"media_large","fid":"363","attributes":{"alt":"","class":"media-image","style":"width: 333px; height: 266px; margin: 3px 10px; float: left;"}}]]To hear the Rocky Mountain Institute tell the story, it’s not a question of whether utility customers will start defecting from their utilities in favor of off-grid solutions that involve energy storage and solar energy. It’s a question of when.

Truth is, it’s already happening in Hawaii—where solar plus storage are cost-effective when compared to utility electric prices, says Jon Creyts, a managing director at RMI. Along with Homer Energy and CohnReznick Think Energy, RMI just released a report detailing the potential for customer defection from the electric grid in major markets by 2025. And customers could do this without incurring higher costs, the report says.

“The economics for grid parity today are already happening in Hawaii. A very robust set of developers and suppliers entered and were doing quite well,” Creyts says. However, the utility experienced troubles taking in high levels of solar from independent solar producers. The power was overloading some of the transmission lines. So regulators took action to restrict developers’ activity, he says.

It makes sense that this is happening in Hawaii, where utility rates are three times higher than the average rates in the US. But what may come as a surprise is the speed at which off-grid solar, combined with energy storage, may be cost-effective in other parts of the US, particularly California and New York City, says Creyts.