German government subsidy will kick-start solar energy storage market predicts IHS

German government subsidy will kick-start solar energy storage market predicts IHS

Market news |
By eeNews Europe

“The German energy storage subsidy is forecast to kick-start the adoption of solar PV energy storage systems in a similar way as its feed-in tariff system ignited the PV industry eight years ago, suggested Wilkinson.

The German solar industry association, Bundesverband Solarwirtschaft (BSW), announced last week that 1,100 solar PV systems have received approval for the Government’s energy storage subsidy, and a further 4,800 applications are in the process of receiving approval. The data was based on information the association received from the KfW bank that is providing financing for the scheme.

The energy storage subsidy, available since the 1st May 2013, provides a grant to lower the upfront cost of installing an energy storage solution in a PV system up to 30kW in size. The subsidy equates to €600/kW, or a maximum of 30% of the eligible costs, for a battery-based energy storage system installed in a new PV system. The total annual budget available for the program in 2013 is €25 million, of which €18.7 million has already been allocated.

"The adoption of residential PV energy storage in Germany will accelerate in 2014 as a result of this subsidy and falling prices of the storage system," said Wilkinson. "Similar storage subsidies are available in both Japan for Li-Ion based storage solutions in the residential sector, and in California where advanced energy storage systems can be subsidized up to 3 MW in size".

Wilkinson continued: "In 2017, we project energy storage in grid-connected applications will generate $9 billion in revenue in 2017".

"The energy storage market in Germany will be dominated by the residential sector, with 30 MW of installations already supported by the subsidy in 2013. Periodic decreases in FiT and continually increasing electricity prices, coupled with decreasing PV system prices, have now made it financially favourable for a home-owner to self-consume PV energy on-site rather than export it to the electricity grid and receive the FiT. An energy storage solution enables the system owner to increase the level of self-consumption from around 30% without a solution to around 60%  if adding batteries. Despite lowering the overall IRR of the system, adding storage provides the system owner with additional benefits such as back-up power, independency from utilities and energy security.”

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