Residents appreciate supportive neighbors, especially those who offer solar energy sales
In a groundbreaking study published in the journal Renewable Energy, it has been found that peer-to-peer (P2P) energy sharing offers significant financial benefits for solar households in Australia. This is particularly true under current low feed-in tariffs and high battery costs, compared to retail prices.
The study, led by Dr. Kevin Wang of the University of South Australia, reveals that P2P trading combined with a 10 kWh battery system could yield a profit of around AUD 4,929 (£2,370/$3,210) over 20 years. This is in stark contrast to traditional grid export, which often results in negative returns due to low tariffs and battery costs.
P2P energy sharing sets selling prices between feed-in tariffs and retail rates, allowing solar households to earn more by selling surplus power directly to neighbours at mutually agreed prices. This not only benefits the solar householders but also lowers grid reliance by over 30%, contributing to grid stability and reducing strain.
Optimal battery sizing is crucial. Smaller or properly sized batteries increase self-consumption and P2P profits, while oversized batteries reduce returns due to higher capital and maintenance costs and because they limit surplus energy available to neighbours.
On the other hand, selling excess energy solely to the grid often results in negative financial returns, mainly because feed-in tariffs are low and battery storage costs remain high, making the economics unfavourable.
The study also suggests that policy and market rules need to evolve to support scalable P2P transactions, as they improve economics for solar owners, benefit buyers, and ease grid pressures.
In Victoria, Australia, the feed-in tariff for solar energy is less than 5 cents per kilowatt hour, while the retail price is around 28 cents. The study found that a P2P energy-sharing system can cut the energy company out of the equation entirely.
However, it's worth noting that the study did not discuss the integration of non-battery technologies like heat pumps and thermal storage as a means to soak up excess generation. Neither did it provide any information about datacenters selling power back to the grid.
The study's findings contradict the Australian government's recent AU$2.3 billion grant scheme to subsidize the installation of home batteries. The study outlines that excess energy generated by a solar harvesting system is sold back for a fraction of what energy companies claim it to be worth.
In summary, for Australian solar households, P2P energy sharing with appropriately sized batteries currently offers better financial returns and community/grid benefits than selling excess energy solely to the grid under prevailing feed-in tariff structures. The study suggests that P2P energy sharing could increase solar uptake beyond the current 40% coverage of Australian homes, providing a promising path for a more sustainable future.
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