IDEAS home Printed from https://ideas.repec.org/a/eee/juipol/v45y2017icp27-35.html
   My bibliography  Save this article

The challenging economics of US residential grid defection

Author

Listed:
  • Hittinger, Eric
  • Siddiqui, Jawad

Abstract

Declining costs for solar photovoltaics (PV) and excitement about new technologies have led to speculation that self-sufficient PV/battery storage systems will soon become competitive with traditional electricity service. We compare a grid-tied residential solar system with an off-grid solar-plus-battery system at 1020 US locations, and calculate three effects of “grid defection” for each: the private net costs to the homeowner, the change in system generation costs, and change in system emissions. For the average US location, an off-grid solar system is almost double the price of grid-connected solar, is associated with higher system generation costs, and has no emissions benefit.

Suggested Citation

  • Hittinger, Eric & Siddiqui, Jawad, 2017. "The challenging economics of US residential grid defection," Utilities Policy, Elsevier, vol. 45(C), pages 27-35.
    • Handle: RePEc:eee:juipol:v:45:y:2017:i:c:p:27-35
    DOI: 10.1016/j.jup.2016.11.003
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0957178716300066
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jup.2016.11.003?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ravindra, Kumudhini & Iyer, Parameshwar P., 2014. "Decentralized demand–supply matching using community microgrids and consumer demand response: A scenario analysis," Energy, Elsevier, vol. 76(C), pages 32-41.
    2. Bernal-Agustín, José L. & Dufo-López, Rodolfo, 2006. "Economical and environmental analysis of grid connected photovoltaic systems in Spain," Renewable Energy, Elsevier, vol. 31(8), pages 1107-1128.
    3. Khalilpour, Rajab & Vassallo, Anthony, 2015. "Leaving the grid: An ambition or a real choice?," Energy Policy, Elsevier, vol. 82(C), pages 207-221.
    4. Eltawil, Mohamed A. & Zhao, Zhengming, 2010. "Grid-connected photovoltaic power systems: Technical and potential problems--A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 14(1), pages 112-129, January.
    5. Celik, Ali Naci, 2006. "Present status of photovoltaic energy in Turkey and life cycle techno-economic analysis of a grid-connected photovoltaic-house," Renewable and Sustainable Energy Reviews, Elsevier, vol. 10(4), pages 370-387, August.
    6. Hagerman, Shelly & Jaramillo, Paulina & Morgan, M. Granger, 2016. "Is rooftop solar PV at socket parity without subsidies?," Energy Policy, Elsevier, vol. 89(C), pages 84-94.
    7. Dusonchet, Luigi & Telaretti, Enrico, 2010. "Economic analysis of different supporting policies for the production of electrical energy by solar photovoltaics in eastern European Union countries," Energy Policy, Elsevier, vol. 38(8), pages 4011-4020, August.
    8. Dusonchet, Luigi & Telaretti, Enrico, 2010. "Economic analysis of different supporting policies for the production of electrical energy by solar photovoltaics in western European Union countries," Energy Policy, Elsevier, vol. 38(7), pages 3297-3308, July.
    9. Kaundinya, Deepak Paramashivan & Balachandra, P. & Ravindranath, N.H., 2009. "Grid-connected versus stand-alone energy systems for decentralized power--A review of literature," Renewable and Sustainable Energy Reviews, Elsevier, vol. 13(8), pages 2041-2050, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Peffley, Trevor B. & Pearce, Joshua M., 2020. "The potential for grid defection of small and medium sized enterprises using solar photovoltaic, battery and generator hybrid systems," Renewable Energy, Elsevier, vol. 148(C), pages 193-204.
    2. Prata, Ricardo & Carvalho, Pedro M.S., 2018. "Self-supply and regulated tariffs: Dynamic equilibria between photovoltaic market evolution and rate structures to ensure network sustainability," Utilities Policy, Elsevier, vol. 50(C), pages 111-123.
    3. Gorman, Will & Barbose, Galen & Pablo Carvallo, Juan & Baik, Sunhee & Miller, Chandler & White, Philip & Praprost, Marlena, 2023. "County-level assessment of behind-the-meter solar and storage to mitigate long duration power interruptions for residential customers," Applied Energy, Elsevier, vol. 342(C).
    4. Daniel Then & Patrick Hein & Tanja M. Kneiske & Martin Braun, 2020. "Analysis of Dependencies between Gas and Electricity Distribution Grid Planning and Building Energy Retrofit Decisions," Sustainability, MDPI, vol. 12(13), pages 1-42, July.
    5. Yu-Cheol Jeong & Eul-Bum Lee & Douglas Alleman, 2019. "Reducing Voltage Volatility with Step Voltage Regulators: A Life-Cycle Cost Analysis of Korean Solar Photovoltaic Distributed Generation," Energies, MDPI, vol. 12(4), pages 1-16, February.
    6. López, Andrea Ruíz & Krumm, Alexandra & Schattenhofer, Lukas & Burandt, Thorsten & Montoya, Felipe Corral & Oberländer, Nora & Oei, Pao-Yu, 2020. "Solar PV generation in Colombia - A qualitative and quantitative approach to analyze the potential of solar energy market," Renewable Energy, Elsevier, vol. 148(C), pages 1266-1279.
    7. von Appen, J. & Braun, M., 2018. "Strategic decision making of distribution network operators and investors in residential photovoltaic battery storage systems," Applied Energy, Elsevier, vol. 230(C), pages 540-550.
    8. Hanser, Philip & Lueken, Roger & Gorman, Will & Mashal, James, 2017. "The practicality of distributed PV-battery systems to reduce household grid reliance," Utilities Policy, Elsevier, vol. 46(C), pages 22-32.
    9. David Vance & Ali Razban & Peter Schubert & Robert Weissbach, 2021. "Investigation into Sizing Photovoltaic with Energy Storage for Off-Grid Transactive Scenarios," Energies, MDPI, vol. 14(4), pages 1-26, February.
    10. Rossi, Joni & Srivastava, Ankur & Hoang, Tran The & Tran, Quoc Tuan & Warneryd, Martin, 2022. "Pathways for the development of future intelligent distribution grids," Energy Policy, Elsevier, vol. 169(C).
    11. Hendam, Mohamed & Schittekatte, Tim & Abdel-Rahman, Mohamed & Kamh, Mohamed Zakaria, 2022. "Rethinking electricity rate design: Fostering the energy transition in North Africa," Energy Policy, Elsevier, vol. 169(C).
    12. Gorman, Will & Jarvis, Stephen & Callaway, Duncan, 2020. "Should I Stay Or Should I Go? The importance of electricity rate design for household defection from the power grid," Applied Energy, Elsevier, vol. 262(C).
    13. Schittekatte, Tim & Momber, Ilan & Meeus, Leonardo, 2018. "Future-proof tariff design: Recovering sunk grid costs in a world where consumers are pushing back," Energy Economics, Elsevier, vol. 70(C), pages 484-498.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pérez-Alonso, J. & Pérez-García, M. & Pasamontes-Romera, M. & Callejón-Ferre, A.J., 2012. "Performance analysis and neural modelling of a greenhouse integrated photovoltaic system," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(7), pages 4675-4685.
    2. Orioli, Aldo & Di Gangi, Alessandra, 2013. "Effects of the Italian financial crisis on the photovoltaic dissemination in a southern city," Energy, Elsevier, vol. 62(C), pages 173-184.
    3. Orioli, Aldo & Di Gangi, Alessandra, 2015. "The recent change in the Italian policies for photovoltaics: Effects on the payback period and levelized cost of electricity of grid-connected photovoltaic systems installed in urban contexts," Energy, Elsevier, vol. 93(P2), pages 1989-2005.
    4. Cellura, M. & Di Gangi, A. & Longo, S. & Orioli, A., 2012. "Photovoltaic electricity scenario analysis in urban contests: An Italian case study," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(4), pages 2041-2052.
    5. Peprah, Forson & Gyamfi, Samuel & Effah-Donyina, Eric & Amo-Boateng, Mark, 2023. "The pathway for electricity prosumption in Ghana," Energy Policy, Elsevier, vol. 177(C).
    6. Orioli, Aldo & Di Gangi, Alessandra, 2014. "Review of the energy and economic parameters involved in the effectiveness of grid-connected PV systems installed in multi-storey buildings," Applied Energy, Elsevier, vol. 113(C), pages 955-969.
    7. Yu-Ling Hsiao, Cody & Ai, Dan & Wei, Xinyang & Sheng, Ni, 2021. "The contagious effect of China’s energy policy on stock markets: The case of the solar photovoltaic industry," Renewable Energy, Elsevier, vol. 164(C), pages 74-86.
    8. Aldo Orioli & Vincenzo Franzitta & Alessandra Di Gangi & Ferdinando Foresta, 2016. "The Recent Change in the Italian Policies for Photovoltaics: Effects on the Energy Demand Coverage of Grid-Connected PV Systems Installed in Urban Contexts," Energies, MDPI, vol. 9(11), pages 1-31, November.
    9. Orioli, Aldo & Di Gangi, Alessandra, 2017. "Six-years-long effects of the Italian policies for photovoltaics on the pay-back period of grid-connected PV systems installed in urban contexts," Energy, Elsevier, vol. 122(C), pages 458-470.
    10. Jan K. Kazak & Joanna A. Kamińska & Rafał Madej & Marta Bochenkiewicz, 2020. "Where Renewable Energy Sources Funds are Invested? Spatial Analysis of Energy Production Potential and Public Support," Energies, MDPI, vol. 13(21), pages 1-26, October.
    11. Dusonchet, L. & Telaretti, E., 2015. "Comparative economic analysis of support policies for solar PV in the most representative EU countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 42(C), pages 986-998.
    12. Rawat, Rahul & Kaushik, S.C. & Lamba, Ravita, 2016. "A review on modeling, design methodology and size optimization of photovoltaic based water pumping, standalone and grid connected system," Renewable and Sustainable Energy Reviews, Elsevier, vol. 57(C), pages 1506-1519.
    13. Antonelli, Marco & Desideri, Umberto, 2014. "The doping effect of Italian feed-in tariffs on the PV market," Energy Policy, Elsevier, vol. 67(C), pages 583-594.
    14. Jordehi, A. Rezaee, 2016. "Parameter estimation of solar photovoltaic (PV) cells: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 61(C), pages 354-371.
    15. Belqasem Aljafari & Siva Rama Krishna Madeti & Priya Ranjan Satpathy & Sudhakar Babu Thanikanti & Bamidele Victor Ayodele, 2022. "Automatic Monitoring System for Online Module-Level Fault Detection in Grid-Tied Photovoltaic Plants," Energies, MDPI, vol. 15(20), pages 1-28, October.
    16. Marcin Bukowski & Janusz Majewski & Agnieszka Sobolewska, 2020. "Macroeconomic Electric Energy Production Efficiency of Photovoltaic Panels in Single-Family Homes in Poland," Energies, MDPI, vol. 14(1), pages 1-21, December.
    17. Jan Prusa & Andrea Klimesova & Karel Janda, 2013. "Consumer Loss in Czech Photovoltaic Power Plants," CAMA Working Papers 2013-50, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    18. Sarasa-Maestro, Carlos J. & Dufo-López, Rodolfo & Bernal-Agustín, José L., 2013. "Photovoltaic remuneration policies in the European Union," Energy Policy, Elsevier, vol. 55(C), pages 317-328.
    19. Telaretti, E. & Dusonchet, L., 2017. "Stationary battery technologies in the U.S.: Development Trends and prospects," Renewable and Sustainable Energy Reviews, Elsevier, vol. 75(C), pages 380-392.
    20. Kristoffer Palage & Robert Lundmark & Patrik Söderholm, 2019. "The innovation effects of renewable energy policies and their interaction: the case of solar photovoltaics," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 21(2), pages 217-254, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:juipol:v:45:y:2017:i:c:p:27-35. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.sciencedirect.com/journal/utilities-policy .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.