Confidential Insights into the German Storage Market July 10 th 2014 - PowerPoint PPT Presentation

Confidential Insights into the German Storage Market July 10 th 2014 Daniela Schreiber| Partner| IBESA

Agenda Confidential Introduction IBESA Market development Profitability of PV storage systems The role of the installers The attitude of the end customers 2

The International Battery and Energy Storage Alliance (IBESA) Confidential IBESA´s common vision is: ”To promote a path of cooperation and mutual support in achieving proactive solutions between all sectors within the Photovoltaic (PV) Power Generation, Battery Storage and the Smart Grid Technology value chain.“ 3

Who can be a Member of IBESA Confidential 4

Confidential Market Development 5

Forecast Market Development • A strong market growth is expected until 2020. Until then the share of retrofit storage systems becomes the most important market driver. Confidential Quelle: EuPD Research Source: EuPD Research 2014 Prognose der Marktentwicklung Forecast Market Development 120.000 100% Neue PV-Installationen mit Speicher New PV installations with storage Nachrüsten alter PV-Anlagen mit Speicher Retrofitting old PV installations with storage 90% Percentage portion of new and old PV systems Speicheranteil an neuen PV-Installationen Storage share of new PV installations 100.000 Number of the storage systems Anteil von Speichern bei Nachrüstungen Storage share when retrofitting Anzahl der Speichersysteme 80% Anteil an neuen bzw. alten PV-Anlagen 70% 80.000 60% 60.000 50% 40% 40.000 30% 20% 20.000 10% 0 0% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 6

Development of the PV Storage Subsidy • The subsidies for PV storage systems are increasing constantly. However there is still 60 percent of the total subsidy budget available. Confidential Source: KfW, BSW 2014 Development of subsidized residential PV-Storage batteries in Germany 6,000 100 Mio € Total subsidy budget: Total subsidy budget: Total subsidy budget: 25 Mio. € 25 Mio. € 13% 25 Mio. € 90 Mio € Used subsidy budget: Used subsidy budget: 35% 40% Used subsidy budget: 5,000 3.3 Mio. € 10 Mio. € 8.8 Mio. € 65% 60% 80 Mio € Claimed subsidies Claimed subsidies Claimed subsidies 87% Still unclaimed subsidies Still unclaimed subsidies Still unclaimed subsidies 70 Mio € 4,000 66.0 Mio € 60 Mio € 3,000 45.3 Mio € 50 Mio € 40 Mio € 2,000 4,000 30 Mio € 2,730 18.7 Mio € 20 Mio € 1,000 10 Mio € 1,100 0 0 Mio € until August 2013 until end of December 2013 until Mid of May 2014 Number of subsidized Systems Total credit sum (kfW) 7

Market potential for residential storage batteries • In European comparison Germany is the most promising storage market. Yet Belgium and Italy are showing high potential as well. Confidential Source: EuPD Research 2014 Market potential for residential storage batteries 0.35 0.30 Residential electricity price EUR/kWh Germany 0.25 Italy 0.20 Belgium UK 0.15 France 0.10 0.05 0.00 0.35 0.30 0.25 0.20 0.15 0.10 0.05 0.00 -0.05 -0.10 FiT in EUR/kWh Bubble size displays the installed PV capacity at the end of 2013 in segment < 10 kWp 8

Confidential Profitability of PV Storage Systems The example of the German incentive scheme for battery systems 9

Profitability of PV Storage Systems Assumptions Confidential Installation date 15.06.2014 System size 6.6 kWp Yield 905 kWh/KWp Equity 100% Battery size (nominal) 5 kWh DOD 80% Life time 20 Price PV system 1,534 €/ kW Price storage system (Lithium Ion) 2,273 €/ kWh Annual electricity consumption 4,500 kWh Electricity price (private households) 27.0 €/ kWh 10

Profitability of PV Storage Systems NPV PV system and battery prices (Lithium Ion) Confidential Source: EuPD Research 2014 Source: EuPD Research 2014 NPV PV System Depending on Battery System Prices 14000 Net present value (NPV) 12000 10000 8000 Net Present Value 6000 4000 2000 0 -2000 -4000 Storage system price NPV PV System incl. Storage 11

Profitability of PV Storage Systems NPV PV system and battery prices (Lithium Ion) Confidential Source: EuPD Research 2014 NPV PV System Depending on Battery System Prices 14000 12000 10000 8000 Net Present Value Today 6000 4000 2000 0 -2000 Storage pays off -4000 Storage system price NPV PV System incl. Storage 12

Profitability of PV Storage Systems NPV PV system and battery prices (Lithium Ion) Confidential Source: EuPD Research 2014 NPV PV System Depending on Battery System Prices 14000 12000 10000 8000 Net Present Value Today 6000 4000 2000 0 -2000 Storage is the better choice Storage pays off -4000 Storage system price NPV PV System incl. Storage NPV only PV (FiT June 2014: 13.01 €Cent/ kWh) (FiT June 2014: 13.01 €Cent/ kWh) 13

Profitability of PV Storage Systems NPV PV system and battery prices – Impact of support scheme (Lithium Ion) Confidential Source: EuPD Research 2014 NPV PV System Depending on Battery System Prices 14000 Storage support scheme  12000 660 €/ kWh battery capacity 10000  max. 3,000 €/ system  Budget 25 Mio. € Storage support scheme 8000 Net Present Value Today 6000 4000 2000 0 -2000 Storage is the better choice Storage pays off -4000 Storage system price NPV PV System incl. Storage NPV only PV (FiT 13.01 €Cent/ kWh) (FiT 13.01 €Cent/ kWh) 14

Confidential The role of the installers 15

Installer´s Point of View • A vast majority of installers already offer PV storage solutions or plans to offer them in 2014. Confidential Source: EuPD Research 2013 Source: EuPD Research 2014 Do you offer storage solutions? | Size | Germany Total High volume Installer Low volume Installer 10% 2% 10% 3% 9% 12% 17% 19% 68% 71% 79% n = 186 n = 66 We offer battery systems Currently we do not offer battery systems but we plan to do so in 2014 We do not offer battery systems and we do not plan to do so in 2014 Don't know/no response n = 252 16

Importance of Features • Sales and profitability are given. For installers offering storage systems the price is not the key buying factor. Technical reliability secured by good warranty conditions and service are crucial. Confidential Source: EuPD Research 2013 Source: EuPD Research 2014 Storage solutions | Importance of features | Germany ø 1.3 Technological maturity 70% 24% Warranty conditions 56% 32% 1.5 Service 53% 37% 1.5 Easy of installation 43% 46% 1.6 Low price 32% 41% 2.0 Brand 20% 37% 2.3 Weight 15% 27% 2.7 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 1 = Very important 2 3 4 5 = Not important at all n = 222 17

Confidential The attitude of the end customers 18

Customer´s Point of View • Customers normally don’t ask for a quotation, therefore installers should offer quotations. Confidential Total New customers 2011 – 2012 Before 2011 Are you aware of storage solutions? 94% 98% 89% 95% 100% Did you consider to invest in a 55% 66% 58% 42% battery system? Did you ask for/receive a 12% 22% 11% 7% quotation for a storage system? Did you install a storage system? 3% 7% 3% 2% 19

Major Obstacles • As expected: Economic reasons are the major obstacle for the end customers. • In addition potential customers don‘t have trust in technical maturity. Confidential Quelle: EuPD Research 2013 Kunden ziehen Speicher Kunden haben sich kein Kunden haben keinen Customers do not take the Customer do not take the Customer do not take the Angebot eingeholt, da: nicht in Erwägung, da: installation into consideration, installation into consideration, Speicher installiert, da: installation into consideration, (Mittelwerte) (Mittelwerte) (Mittelwerte) because…* because…* because…* Price too high (n = 793) 3,7 3,7 3,7 No positive return (n = 804) 3,5 3,2 3,3 Missing technical maturity (n = 796) 3,3 3,1 2,8 High feed in tariffs (n =756) 2,5 1,8 1,5 No need (n = 757) 2,2 1,3 1,3 No space (n = 727) 1,5 1,3 1,2 Installer advised against (n = 621) 1,5 1,6 1,8 ESS not available (n = 598) 1,2 1,2 1,2 Completely 1 = trifft überhaupt Highly 4 = trifft absoult unimportant nicht zu important zu 20

Conclusion  The German market is an attractive market for PV storage! Confidential  PV storage systems are already economically!  Many of the installers already offer PV storage systems!  Rising demand for PV storage systems by the end customers! 21

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