Energy storage will play a very important role in cleantech applications like solar and wind power. It is very encouraging to see the use of Lithium-ion batteries for domestic use in this collaboration between BYD and KB Homes. Earlier Panasonic has announced similar program for Japanese house builders. 16 kWh battery is almost the same like in electric cars (16-24 kWh) and this integration will allow to use solar and wind power for domestic use with smart connection to the grid, when you can sell expensive energy during the day and recharge your Electric Car and/or battery during the night. Mass scale adoption of distributed energy storage by domestic batteries and/or electric cars plugged in to the grid will allow Utilities to integrate domestic wind and solar power on the mass scale into the grid and perform much more efficient grid energy management optimising the load and generation of power. For our Lithium demand it means another wide open market application with a very fast adoption rate which will be generated by lower battery prices and upcoming mass scale production volume will allow to lower prices further in its turn.

Batteries Are Included in KB Home and BYD's Solar House

By Michael Balchunas

Published March 26, 2010

The home of the future – with solar-electric modules on the roof and a lithium-ion battery in the garage – may have a welcome mat out sooner than expected.

The California-based builder KB Home and China's BYD Co., which makes plug-in cars, batteries and solar equipment, have partnered to build modestly priced homes in Lancaster, Calif., that will go a step further than other new solar housing developments by including battery storage of the solar electricity.

Off-grid solar owners for many years have used battery banks to store their generated electricity for later use, but the plan for the KB Home development – smack in the middle of a grid-tied suburban subdivision – could help alter the trajectory for adoption of both solar electricity and plug-in vehicles.

"The energy produced by the solar panels during the peak time is stored in the battery system and can be used later at night for the home," said Bill Wang, business development director for BYD America Corp., at a press conference to announce the partnership in Lancaster, a city about 70 miles north of Los Angeles.

Unlike homemade off-grid battery banks, which have typically used traditional lead-acid batteries, the storage system that KB Home and BYD showed off packages the lithium-ion battery packs in sleek, dark-tinted cabinets with flashing LED lights that continuously display the system's – and perhaps the future homeowner's – status.

The battery packs may store as much as 16 kilowatt-hours of electricity. A typical Southern California household uses about 20 kwh a day. The lithium-ion ferrous phosphate battery packs will be the same type used in plug-in vehicles that BYD expects to roll out in Los Angeles later this year.

Thomas C. DiPrima, executive vice president of KB Home's Southern California division, said the plan is to offer the solar-and-battery combinations first in one model home and four production homes in West Lancaster at no extra cost to the buyers, then to offer the systems as an option in the same subdivision and others. The West Lancaster houses have starting prices that range from about $210,000 to $257,000.

"Our long-term goal is to get to where we can do this nationwide," Mr. DiPrima said. "Our hope and our goal is to make it so affordable that it can be offered in a new home as a standard feature," he added, noting that solar PV is becoming cost-effective as a retrofit for many existing homes. Because the approach is a new one, it could be years before such a system is standard in a new KB home, he said.

Until now, it was thought that battery storage of solar electricity would not even begin to be an option for typical urban and suburban solar owners until years in the future.

Automakers in recent years have been outlining the future potential deployment of used batteries from plug-in cars to store solar electricity. Because automotive battery packs are expected to have typical lifetimes of about seven years and 100,000 miles, and large-scale manufacturing of electrified vehicles is still about two years away, it appeared that widespread use of used batteries in residential garages would not begin until 2018 to 2020.

"Smart" meters make it easier for homeowners and utilities to monitor electricity use, and allow for time-of-use pricing, under which electricity costs more at times of peak demand – typically around breakfast and in the afternoon and early evening – and less during off-peak periods.

Solar photovoltaic systems produce electricity only during the daytime, and their early afternoon peak production often coincides with rising air-conditioning loads. The electricity that utilities buy for distribution at such times generally costs much more than does off-peak production. Traditionally, households have paid a predetermined, average price per kwh for electricity. Time-of-use rates permit pricing that more closely reflects real-world usage and generation patterns.

The plan to use new lithium-ion battery packs in residential garages could open up a range of potential opportunities for owners of solar-electric systems and plug-in vehicles. For the first time, they could have significant control over their generation, storage and use of electricity, moving it from a solar array to a car battery, into the home or into a storage battery, depending on their needs and the electricity's price at a particular time.

The battery pack also could pull low-cost electricity off the grid at night for use during higher-priced peak periods, either in the home or in the grid. The system's operation could be programmed with cellphones, PDAs or computers, or could be automated.

Another potential benefit: the end of blackouts. If a power outage occurred on the grid, a homeowner with a digital meter, a solar-and-battery combination, and perhaps a plug-in vehicle, could be unaffected. Grid-tied systems are designed at present to shut down automatically when grid power goes out, but that is likely to change as the technology develops.

If this use of new lithium-ion batteries were to become very popular, it would likely drive down the cost of such batteries for use both in homes and in vehicles more rapidly than expected through economies of scale in manufacturing.

Reducing the cost of solar and battery technologies is a key part of the plan. Using energy more sparingly and efficiently, and saving money for consumers, is the ultimate goal. KB Home plans to study the usage patterns of those who buy the solar-and-battery homes.

"All we'll ask of the homeowners is that they'll share with us their energy bills so we can see what the actual savings are in a home," said Mr. DiPrima.

The city of Lancaster, which has a population of about 145,000 people, is in the Mojave Desert's Antelope Valley, in northern Los Angeles County. The city waived municipal development fees for the homes to be outfitted with solar-and-battery systems, and has fast-tracked the permitting process. The first solar model home is expected to be completed in three or four months.

R. Rex Parris, the mayor of Lancaster, said at the press conference that petroleum is a finite energy source.

"The price of energy is just going to go up and up and up," he said. "If we can reduce the amount of energy we're using and the cost of it, it becomes much more affordable to live for all the hard-working families in the Antelope Valley and everywhere else."

Mr. Parris said the new approach "redefines how Americans are going to use energy in their houses."

BYD became prominent in U.S. investment circles when Warren Buffett's Berkshire Hathaway Inc. bought 10 percent of the company in 2008. It started as a low-cost producer of cellphone batteries, and only recently began manufacturing automobiles, lithium-ion battery packs for plug-in vehicles, and solar equipment. Wang Chuanfu, BYD's chairman, is believed to now be the wealthiest person in China.

Stella Li, senior vice president of BYD, said at the press conference that the goals of the partnership to build the solar-and-battery-equipped homes are to help people "save money and make a cleaner planet."

Mr. DiPrima of KB Home said he expects homeowners to have some reservations about the new technology at first.

"I think the biggest concern will be, 'How difficult will it be for me? Do I have to go throw a switch? Do I have to program a computer?' And the fact that the system does that will probably take some of the fear away," he said.

Unlike some new solar-home developments that are installing tiles that blend in with a roof, KB Home and BYD plan to use stand-off modules of the type commonly added as retrofits to existing buildings. Modules with air space beneath them operate at higher efficiency because of the cooling effect, but are more visible than tiles.

"We are not seeing the aesthetics of solar being a deterrent," Mr. DiPrima said. "In fact, in California we've found that people want to show off their solar panels."

He added that because some people do prefer the look of solar tiles, KB Home works with local officials on the type, style and aesthetics of equipment, as it does with other elements of home designs.

"We're not looking at aesthetics as being a challenge," Mr. DiPrima said. "We've got to make sure that the system is as easy to operate as possible. The less they have to do, the better."