STORE OR SELL? THE EMISSIONS AND ECONOMIC EFFECTS OF TAKING
ROOFTOP SOLAR OFF-GRID
Eric Hittinger, Rochester Institute of Technology, 585-475-5312, eshgpt@rit.edu
Overview
Distributed, home-scale solar photovoltaic (PV) systems ("rooftop" solar) have become an increasingly
popular choice in the United States. The US Department of Energy estimates that approximately 500,000 homes
had rooftop solar systems in 2014 [1], and that this figure is expected to climb to several million by 2020 [2]. These
systems are being rapidly adopted because of beneficial state and federal subsidies, net metering policies, and costs
that are competitive with consumer retail rates, which are several times higher than wholesale electricity prices.
Consumers also have the additional option of "grid defection" - purchasing an energy storage system that enables
them to self-supply reliable power and disconnect from the local utility. Some recent studies, including one from
the Rocky Mountain Institute, have predicted that grid defection will become an increasingly popular option and
threaten traditional utility models in the coming decades [3]. Similar arguments have surrounded the media
discussion of the recently-announced Tesla lithium-ion battery home storage device [4]. However, other recent
work has shown that leaving the grid requires significant investment in extra solar PV and batteries that have a net
present cost far higher than the money saved from disconnection [5].
In this work, we use microgrid system modelling tools and marginal emissions estimates of grid operation
to estimate three important effects of grid defection: 1) the change in CO 2, NOx, and SO2 emissions from the grid, 2)
the change in total grid generation costs, and 3) the net cost or savings to the homeowner. For most locations in the
US, taking an existing solar PV system off-grid results in increased system emissions, increased system costs, and
significantly increased cost to the homeowner.
Methods
In this research effort, we assume that a rooftop solar system already exists and examine the costs and
effects of taking it off-grid, essentially comparing grid-tied to off-grid home-level systems. The private costs of grid
defection are calculated using time-series load and solar irradiance data and by comparing utility rate structures to
the costs of off-grid systems calculated with the Energy System Model software [6]. Three cases are examined: net
metering (where the utility accepts extra power at the retail rate), wholesale purchase (where the utility accepts
power at the wholesale rate), and no payment (where the utility accepts extra power but doesn't pay for it).
Extra solar energy put onto the grid is not wasted - rather, it displaces the costs and emissions of traditional
generators, and this benefit should also be investigated. Grid defection results in changes to electricity system costs
and emissions because of changes in net load: a grid-tied solar home will tend to produce extra power in mid-day
and consume power at night. The change in system generation costs are calculated by examining the net change in
load between the grid-tied and off-grid cases and calculating the net wholesale costs of that energy. CO2, NOx, and
SOx emissions resulting from the operation of the energy storage are calculated using the Marginal Emissions Factor
approach developed by Siler-Evans et al [7]. To understand the regional heterogeneity of the results, this analysis is
repeated at approximately 100 locations throughout the US.
Results
For most locations, grid defection results in increased private costs, increased system costs, and increased
emissions. Private costs are high because the homeowner must spends tens of thousands of dollars on storage and
extra solar PV to ensure reliable electricity. System generation costs also increase because a grid-tied system tends
to produce electricity when prices are higher (mid-day) and consume electricity when prices are lower (night).
Emissions effects vary by location, but emissions tend to be higher due to inefficiency of the battery system: the use
of storage means that more electricity is needed overall to account for battery losses.
Conclusions
For homes that produce enough energy for all of their needs, remaining grid-tied is the best option. The
grid can act as a free, infinitely-large battery for their extra electricity (under net metering) or an inexpensive source
of fill-in power (without net metering). Some homeowners may be willing to pay a high cost for storage in order to
achieve environmentally-friendly self-generation. However, this work also demonstrates that the system effects of
grid defection are undesirable as well: system costs and emissions generally increase, indicating that it would be
socially superior to put extra solar energy onto the grid, where it will displace traditional generation, rather than
store it inefficiently for later self-consumption.
References
[1] US Energy Information Administration, “Annual Energy Outlook 2014,” May 2014. [Online]. Available:
http://www.eia.gov/forecasts/aeo/. [Accessed September 2014].
[2] US Department of Energy, “SunShot Vision Study,” February 2012. [Online]. Available:
http://energy.gov/sites/prod/files/SunShot%20Vision%20Study.pdf.
[3] Rocky Mountain Institute, “The Economics of Grid Defection,” 2014. [Online]. Available:
http://www.rmi.org/PDF_economics_of_grid_defection_full_report.
[4] M. Barnard, “Here's Why Tesla's Battery Is A Big Deal,” May 2015. [Online]. Available:
http://www.forbes.com/sites/quora/2015/05/14/heres-why-teslas-battery-is-a-big-deal/.
[5] R. Khalilpour and A. Vassallo, “Leaving the grid: An ambition or a real choice?,” Energy Policy, no. 82, pp.
207-221, 2015.
[6] E. Hittinger, T. Wiley, J. Kluza and J. Whitacre, “Evaluating the value of batteries in microgrid electricity
systems using an improved Energy Systems Model,” Energy Conversion and Management, vol. 89, pp. 458-472,
2015.
[7] K. Siler-Evans, I. Azevedo and M. G. Morgan, "Marginal emissions factors for the US electricity system,"
Environmental science & technology, vol. 46, no. 9, pp. 4742-4748, 2012.