Overseas home energy storage sales model

Residential energy storage systems integrate various components including battery cells, modules, power conversion systems (PCS), software i.e., battery management systems (BMS) and energy management systems (EMS), and other balance of plant items.

Under NEM 3.0, solar exports are compensated at the “avoided cost”, or ACC, which represents the long-term hourly value of a distributed energy resource (DER) for the utility grid, measured in $/kWh. The California Public Utilities Commission calculates these values every year.

Residential storage products have similar appearance regardless of brand, signifying the commoditization of these products. It is difficult for system providers to set themselves apart and grow brand awareness. This section summarizes and compares the main features that companies advertise for these products.

Residential storage product features depend significantly on the markets they are being sold in (Table 4). Providers typically offer much larger entry-level systems in the US and Australia, where the energy demand and typical customer-sited solar system size of an average home is larger than in Europe.

The downstream areas of the value chain, such as aggregation and energy trading, remain a focus area for these residential storage providers looking to grow their business and extract value. Investments tend to be focused in this area, and storage providers without these capabilities are increasingly acquiring them.

Progress has been concentrated in a few leading markets including Germany, Italy, Japan, the US and Australia. Combined, BloombergNEF expects these five markets to represent around 88% of cumulative residential battery storage capacity installed globally by the end of 2023. Uptake in other markets today is limited by economic viability.