Tesla Outpaced by LG Resu 6.4


Tesla.

It has been a few months since our last newsletter and part of that has being considering the impact of one companies announcement and its impact on the battery market.

Tesla’s revolutionary compact battery storage system which can hold power from the grid or energy sources such as solar for both homes and businesses, has exceeded all expectations with the intensity of its launch. Still many questions remain though. Since Tesla dont make their own inverters, how will this interface with existing stock? What sort of communication protocol does it use and what sort of battery information will this display?These are technical questions that integrators are facing as they move towards tieing these systems into every varying situations.

Our analysis? Its a great product with a great price, but once compared to its competition is nothing to write home about.

One thing Tesla have achieved though, is a mass media event unlike anything ever seen in the storage industry. It seems everyone has an opinion on the Tesla. Many people even have detailed cost return scenarios, which ironically seem to nearly always match their initial ideological view of either storage is good, or storage is bad. We have seen payback periods ranging from 5 to 50 years and most of it based on a smoke and mirrors product launch backed by very little real data.

Don’t get me wrong, we have complete faith in the Tesla product and are looking forward to launching it ourselves. . AFTER we have everything we require to complete our design calculations and ensure that the communications system is compatible with selected inverters.

So for now it seems we still have to wait?

Wrong.

In striking contrast to Tesla’s hype there have being plenty of other lithium ion storage options hitting the market several of which we have blogged about previously. However about two weeks ago, a well-known appliance manufacturer from South Korea with nearly two decades of proven experience in both the solar and storage industry very quietly unveiled their lithium ion solution.

And guess what? Its pretty much exactly the same as the Tesla, with very similar pricing. Only its available now and is certified for use with SMA inverters. The LG Resu 6.4 kWhr unit is similar in size, shape and capacity. It comes with a 7 year capacity warranty and is rated for >6000 cycles at a DOD of 90%, which is in excess of 15 years! Furthermore the unit is expected to last roughly 20 years at which point it will have a usable capacity of around 60%.

Anyone who has punched the numbers on batteries will know that this makes a massive difference and with electric cars on the way, stored renewable energy is going to be in high demand especially when outputting at cheaper than the grid.

Lets look at an example.

A typical suburban home uses around 20kWhr per day. In a hybrid situation we want to cover 360 days per year and leave the rest to the grid. To achieve that we install a 6.25kW PV system using Trina panels and a SMA 5000TL inverter. On top of that we put in a Sunny Island 6 (hybrid inverter), which is then linked to a LG Chem 6.4kWhr unit via CAN bus. The system will allow us to store excess energy for later use at night, during peak periods, or during a blackout. The system allows for up to 20A of constant draw from the batteries at night, with up to 50A from the combination of battery and PV during the day. If we exceed these ratings or there is no power and or batteries available the grid simply kicks in. Cost installed is $22,999 INC GST and whilst that price will move down over time LG have all but matched Tesla’s forward pricing so we dont expect it to move much until the car maker’s products hits our shores.

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Returns?

Lets look at the grid cost of this power. We are going to assume a 10 year lifespan with 100% usage. We will also crunch a 15 year lifespan with 100% usage.

Over the course of 10 years this system will produce, store and use 94,671kWhrs of energy, which has a retail value of roughly 27c INC GST per unit. This gives a total of $25,561 in electricity costs which ‘beats’ the grid by some $1500 and provides blackout protection and power quality filtering in the one unit!

Over 15 years the retail value of that electricity is $42,601 so by that point the home owner has saved about $17,000 in kWhr charges and has well and truly paid off the system itself.

What does this work out to be in terms of cost of power? If we divide the system cost by the kWhrs we come to a figure of 24c INC GST over 10 years or 14.5c over 15 years. Whilst there will be some degradation and losses which will occur, these numbers are already a long way ahead of current grid costs.

Whatever the product or outcome it seems clear that 10+ year plus battery systems with 20A or more maximum discharge will become the norm. Furthermore it seems likely that they will achieve deep penetration in both urban and rural areas based on economics alone. Since the LG comes with a higher energy density ratio than the Tesla its also clear that there is more than one serious player in this market and that if anything Tesla is going to have to apply its infamous accelerator to keep up.

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