This economic analysis indicates that pairing solar PV with battery storage systems can deliver significant electricity bill savings for California affordable housing residents and property owners.
Battery storage is emerging as an effective new strategy for reducing electricity costs for affordable multifamily rental housing in California. Battery storage systems not only provide economic returns today, they can also preserve the value of solar in an evolving policy and regulatory environment. Because batteries empower owners of solar photovoltaic (PV) systems to take control of the energy they produce and when they consume it, storage can deliver deeper cost reductions that can be shared among affordable housing owners, developers, and tenants.
California has installed numerous integrated solar and battery storage projects; however, few have served lowincome tenants or owners of affordable rental housing. This disparity is due to many factors, including a lack of information about the economics of these systems in multifamily housing. To provide that needed information, Clean Energy Group, California Housing Partnership, and Center for Sustainable Energy, with analytical support from Geli, are embarking on a series of reports on solar and storage in California affordable multifamily rental housing.
This first report examines the utility bill impacts of adding battery storage to stand-alone solar in affordable rental housing facilities in California's three investor-owned utility service territories, each with different rate structures. It is the first such report ever completed on these technologies in this sector in California.
The report reaches several key conclusions:
- Under current utility rate tariffs, the combination of solar and storage technologies could virtually eliminate electric bills for many owners of affordable housing properties. Unlike stand-alone solar, which reduces energy consumption expenses but does little to offset demand related charges, a properly sized solar and battery storage system can eliminate nearly all electricity expenses, resulting in an annual electric utility bill of less than a few hundred dollars in some cases.
- It makes good economic sense today for solar and battery storage to be installed in affordable multifamily rental housing in California. The addition of battery storage to solar improves the economics of each property analyzed across all utility territories, reducing project payback by over three years in some cases.
- The addition of storage technologies has the potential to nearly double stand-alone solar electricity bill savings at about a third of the cost of solar. For example, the addition of a $112,100 battery storage system to a $385,000 solar installation increased savings from $15,000 per year to $27,900, an 85 percent increase in savings for only a 29 percent increase in cost.