It could be years before the average household is interested in storing energy, energy experts have said in response to Tesla’s announcement of cheap home energy storage devices.

On April 30 Tesla’s Elon Musk unveiled three different-sized batteries – two sizes for the home and one utility sized. The lower-than-expected price of AU$4300 for the 10 kilowatt-hour battery and a bit less for the 7kWh surprised many but, according to some, it’s still too much of a hit to the hip pocket for immediate mass uptake.

Alternative Technology Association manager of policy and research Damien Moyse told The Fifth Estate that on top of the $4300 Powerwall people may need to buy an inverter and inverter charger, both worth a couple of thousand each.

“Normal grid inverters start at $1000, inverter chargers start more at around $3000 and go up from there,” Mr Moyse said.

On top of that, if they don’t already have photovoltaic panels on their roof, they will need to buy those too.

“For somebody without PV now, they’re looking at least $15,000,” Mr Moyse said.

He said that ATA analysis in the past couple of days showed customers might be able to operate a Powerwall without an inverter charger, which would take that price down to about $12,000.

Mr Moyse said the ATA’s analyses were based on limited information, which it was continually working to update.

“I’m hesitant to stand by anything at the moment because essentially what we’ve had is a marketing announcement (by Tesla),” he said. “Everything else at the moment is conjecture.”

Energy Supply Association of Australia chief executive Matthew Warren’s estimate was more pessimistic.

In a letter to members last week he said the Tesla product did not yet offer a viable proposition for consumers.

Mr Warren said there were four main ways people would the use the Powerwall:

  • As power storage in addition to existing electricity supply from solar
  • For electricity supply during peak demand from the grid
  • As storage being managed by a company to sell to the wholesale market on peak days
  • As storage coupled with solar PV to go “off grid”

Mr Warren went through each of these points in detail and calculated that, depending on how the Powerwall was being used and where the resident was living, it would take the average consumer at least 15 years to make back the money spent.

Climate Council councillor Andrew Stock said the Tesla product and the whole concept of energy storage is about where solar panels were 10 years ago, and the price would come down as more people buy the product.

Mr Stock said a big driver of sales in batteries would be people’s fear of rising prices set by energy retailers.

“It’s that fear of continuing increases in prices and also not wanting to be at the behest of electricity retailers where customer satisfaction generally is quite low,” he said.

Does individual energy storage threaten the big electricity retailers?

Maybe. But not if electricity retailers can help it.

Mr Moyse said it was possible that as more consumers decided to use their own energy storage, centralised generators would need to close down.

“These companies are brilliant at making their operations last as long as possible,” Mr Moyse said.

“They’ll survive this for a while.”

But what was likely, he said, was that retailers would adapt to the new market and begin to provide their own energy storage devices.

Mr Moyse said retailers would buy the components, package them and install them on your wall and roof – only you won’t own it.

The new way of retailing energy

“Consumers will either do it for themselves and if it’s too complex or too expensive upfront they’ll do it through their retailer,” Mr Moyse said.

It will be cheaper for customers to do it themselves, but Mr Moyse said the retailers would be banking on the fact that many people won’t have the time or patience.

That’s exactly what AGL is preparing for now.

AGL executive general manager for new energy Marc England told The Fifth Estate customers would be looking for a complete package of solar, storage and grid energy.

AGL is the first energy retailer to launch a battery storage device into the Australian market and Mr England said the company wanted to be a leader in that space.

“While the transition to battery storage being mainstream will take some time, we do believe that energy storage can benefit consumers and businesses now and those customer benefits will increase as the price of batteries drops,” he said.

“We have seen the energy market change as the price of solar fell and it’s likely we’ll see similar dynamics in storage.”

An Energy Australia spokesperson said its customers wanted more control of their energy consumption.

The spokesperson said Energy Australia was trialling battery storage technology and “when viable, it will be another service we will look to offer customers”.