Can energy storage make solar installation more profitable?
Solar installers worldwide have ran into problems attempting to both grow their business and make a profit — almost all of them have had to focus on either one or the other. Sunrun, however, seem to be breaking out of the pattern. The company has seen steady and continuous growth over the past 10 quarters, but has also managed to maintain and even increase its profits.
Sunrun’s deceptively simple strategy is to focus on generating more value per dollar of cost from their installations, by focusing on the whole rooftop solar system. One way of adding this extra value to the system is including energy storage.
With more than 2000 combined solar and storage units ordered, Sunrun isn’t the first to offer batteries with rooftop solar, but it far outstrips the competition. For a modest increase in upfront cost, solar customers in return receive potential future savings and backup stored energy. In California, while the overall percentage of solar buyers who also choose to include storage is low (10%), this rate doubled in Q3. A positive sign for future uptake?
It goes without saying that the profitability of this strategy is more or less likely depending on where in the United States (or in the world) it is being attempted. There are common factors that make rooftop solar plus energy storage a profitable combination: high levels of sunshine, high electricity prices and an amenable regulatory and policy environment. While Sunrun continues to seek higher attachment rates in California, in Hawaii, all of its rooftop solar systems include its energy storage addon, BrightBox, as standard. How Sunrun will fare in its next target market, Arizona, is yet to be seen.
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