Residential solar and storage is such a hot ticket item that some of the nation’s biggest volume home builders are making sure they include it as a standard in new homes.
Executive general manager of CSR Bradford Anthony Tannous believes that in the next two to three years all new homes in Australia will come with solar and storage as standard.
He says builders now offering his company’s solar and storage packages as standard included Metricon Homes and Clarendon Homes in Queensland, Arden Homes in Victoria and JG King in Victoria.
Clarendon Homes is NSW is also offering packages as an upgrade, as is national volume builder Coral Homes.
“Queensland and Victorian builders seem to have taken to this,” Mr Tannous said.
In Victoria the residential sector had “always been energy conscious”, with the government giving the focus added impetus by being the first to mandate a six star NatHERS as code minimum.
To achieve the six stars, builders could either increase insulation or add solar panels.
The new move to add storage does not improve NatHERS ratings, however, as the rating system does not take storage into consideration, Mr Tannous said.
Some of the builders the company works with are offering both the company’s solar and storage package together with increased insulation.
He said the company’s Bradford Solar division had two primary markets – direct to builders and direct to consumers.
It kicked off its foray into renewable energy storage by offering the Tesla Powerwall 1 with or without panels and inverter.
On 9 March this year it launched the new offer of the Tesla Powerwall 2, initially both the DC – which does not include an inverter – and the AC, which has an inverter incorporated as part of the battery system.
Within the first week of the announcement, Mr Tannous said the company had 1000 enquiries.
He said the announcement by Tesla that it would no longer be selling the DC Powerwall 2 into Australia resulted in some potential customers that already had panels and inverters going elsewhere or “holding out” for another solution for storage.
Compared with the Powerwall 1 offer, Mr Tannous said the conversion rate from enquiry to sale had been higher for the Powerwall 2.
The batteries are expected to land in Australia in mid-April.
The battery options are either 4kW or 5kW. Mr Tannous said the buyer also needed to have at least 4kW of solar PV, or the company would not proceed with the sale.
“It just wouldn’t have the return on value,” he said.
There are two major markets for the products – retrofit for existing solar PV owners and new builds.
The recent flurry of enquiries were mainly for new builds or people looking to install panels, Mr Tannous said.
The reason the company chose to retail the Tesla product was because it currently had the best price on the market and the value in terms of dollars for output was best.
The majority of buyers are either paying cash in full, or adding the cost to their mortgage in the situation of a new build, he said.
The company also offers a finance package in association with Select Mutual Building Society, which offers a “green loan” package with a 6.10 per cent variable interest rate a year over five years for up to $25,000. There has not been a large uptake of the finance option, however.
While the Powerwall 1 market was mainly younger buyers, Mr Tannous said the new release was seeing a “good spread” in terms of customer demographics.
“The brand has created a lot of demand,” he said.
The momentum was enough for the company to keep investing in its marketing of solar, Mr Tannous said.
Demand has led to company growth
It has also resulted in the company creating more jobs specifically to service the solar and storage market. Mr Tannous said 13 office and sales staff had been added as well as 20 installers, some as direct employees and some as contractors.
All the installers are certified electricians and have to hold Clean Energy Council accreditation for Design and Install of Grid Connected Photovoltaic Systems and Battery Storage Endorsement.
All installations also have to meet a number of Australian standards, including AS5033, AS4777 and AS3000.
But before any sale is completed and installation commences, Mr Tannous said the first thing the company did was check the consumer’s energy use.
“If they are not using enough, we will tell them not to buy.”
He said the company would rather lose customers than have the technology not deliver a return.
The package also includes options for management and data systems. The management system cycles the battery in terms of charging, discharging or exporting to the grid. The Solar Edge Inverter incorporated into the system puts out a lot of information, Mr Tannous said, including what has been stored, generated or used.
There is an option for that information to be cloud-hosted so it can be accessed from anywhere.
Installations generally take anywhere from half a day to two days to install, depending on the system size.
Mr Tannous said that “hurdles getting approval from grid companies” could slow things down, however.
“WA has been a more challenging state as most homes are three phase and Western Power has a load variance limitation between these phases.
“The Victoria region covered by Ausnet can also be tricky for systems larger than 4.6kW as they have stricter connection requirements. However we have good relationships with the distribution network service providers and are working closely with them to find solutions which meet their requirements so the customer experience is as fast and simple as possible.”
Nationally, grid providers can take anywhere from one day to two months to approve a permission to connect, depending on the size of the system and their application process.
For example, PowerCor will take between two days to two weeks; Endeavour takes between two and three weeks; AusNet between three and five weeks; SA Power networks give same day approval; and United Energy has no approval requirement for residential installations.
Why an insulation manufacturer got into solar
As to the question of why an insulation manufacturer would branch out into solar, Mr Tannous said the aim was to find ways to expand its portfolio and full product range to help people “live in comfort”.
“We have been manufacturing insulation since 1934, and the whole proposition of that is around comfort and reducing energy costs,” he said.
“So it made sense to expand into batteries and PV, so people can increase their comfort without it costing the earth.”
The company is also looking to solar for its own use.
“We are a big energy user, and we have been feeling the pain of rising electricity costs,” Mr Tannous said.
To offset this cost increase, it is looking to install 1.6 megawatts of solar PV – a system comprising around 6000 panels – on its Ingleburn plant.
The system will not include battery storage as it is expected the plant will consume most of the energy generated.
Installation is hoped to commence in June or July this year, Mr Tannous said.
The project is being funded entirely from capex, with no subsidies or grants.
Mr Tannous said the ROI based on current electricity prices will be around eight years, however given the likely trajectory of prices in future that could shrink to as little as 6.5 years.