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Thursday, March 27, 2014

Solar Plus Storage As Disruptive As the Internet

Former Energy Department head Steven Chu says that the adoption of solar plus storage will be as disruptive as the internet. Chu explained that as the cost of photovoltaic modules plummeted and battery prices also fell, it was possible to envisage a situation in 5 to 10 years where homeowners could be 80% self-sufficient and off-grid with a $10,000 to $12,000 solar-plus-battery system.

This is, of course, exactly the kind of future that's coming soon. The electric utilities are fighting it like Bill Gates fought open source software, but the end result is likely to be same. Utilities are going to have to change their business model to account for captive customers freeing themselves.

According to Chu, utilities need to borrow money cheaply to install solar plus storage at customer locations. In return, the utilities would charge the customer a low fee for maintaining the system. Utilities would gain from not having to install power wires to entire neighborhoods, which is one of the most expensive portions of a grid-based system. The customer would gain from having the utility bear the cost of purchasing and maintaining the system. And, of course, the public would gain from the reduced greenhouse gas emissions which come from centralized command-and-control utility power systems.

If the utilities instead fight change, they will become non-competitive dinosaurs whose only hope is a government bailout.

Chu's address can viewed here: