A group of California solar companies say it’s time for the solar industry to transform its standard product — solar and storage — into a new offering incorporating electrification and partial grid defection.
Andrew Krause, CEO at Northern Pacific Power Systems and president of non-profit Agile Electrification, led a discussion last week on the new approach for residential customers, called “solar-led electrification,” in the expo hall at Intersolar & Energy Storage North America in San Diego, California.
Through solar-led electrification, homeowners achieve partial grid defection when they swap out their gas appliances for electric alternatives and power them with onsite solar and battery storage rather than grid electricity.
Subscribe to the free Energy Changemakers Newsletter
The announcement was accompanied by the release of a paper by the non-profit Agile Electrification and the UC San Diego Design Lab, which finds that “65% grid defection” produces optimal savings for California homeowners.
65% grid defection requires that homeowners reduce their use of grid power by 65%, replacing it with less expensive energy from onsite solar.
Researchers looked at four different electrification scenarios for 60 average-sized homes in northern California. They found that 65% grid defection saved homeowners an estimated $150,000 over 20 years.
Electrifying while loosening grid ties
“As you start electrifying, you’re adding more load to the home. And when you do that, you’re then dependent on your electricity provider even more,” Krause said. “So solar-led electrification is really the solution.”
Conditions are ripe for partial grid defection where utilities have reduced net metering payments for solar energy produced by homes, according to the paper. A separate Canadian study released last year found total grid defection cost-effective in five US states; its authors also pointed to net metering rollbacks as the issue.
Heat pump paradox
Electrification alone isn’t always cost-effective because of what the Agile Electrification paper calls “The heat pump paradox.” Electric heat pumps are more efficient than natural gas furnaces, producing the same amount of heat from one-half to one-fourth of the energy. So, all things being equal, heat pumps should result in lower energy bills for consumers. However, all things are not equal. In some states, electricity rates are significantly higher than natural gas prices, wiping out the efficiency gains of heat pumps. In California, for example, the state’s largest utility, PG&E, charges residential customers a bundled rate more than 2.5 times the national average, according to the paper.
However, according to the researchers, maintaining the status quo — grid electricity and natural gas heat — is expensive because it leaves homeowners exposed to rising energy prices and grid outages with no backup.
Electrifying using grid power provided long-term savings for many homeowners, but not all of them. Another approach, installing solar panels for 100% of the home’s electricity — but not its heat — provided more savings but fell short of the savings achieved by solar-led electrification for most homes studied.
“This approach reduces operating costs immediately, protects homeowners from future rate hikes, and offers resiliency against grid outages,” the paper says.
But there is no one-size-fits-all solution because of differences in home sizes, age, energy consumption, and solar potential. The paper calls for comprehensive modeling of homes to evaluate solar potential, energy consumption, and homeowner goals before selecting an approach.
Solar’s future?
“The industry has long believed that fundamentally, looking at the cost of solar compared to grid power, powering home electrification with onsite solar and battery storage should make the most sense for homeowners, but we didn’t have the framework to prove it. Now we do,” Krause said.
Carl Lenox, product and innovation leader at Sunrun, described the Agile Electrification findings as “the seed of something that’s going to grow into the future of this industry.”