Tesla Powerwall: Cost, benefits, and how to install the EV maker’s home battery

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If you're a solar homeowner or are worried about rising energy costs, a battery storage system like the Tesla Powerwall might be the best investment you ever make. The Tesla Powerwall minimizes the electricity your home needs to draw from the grid, making your home more self-sufficient.

But they come with quite a hefty price tag, so is the investment worth it? Let's take a look.

The PowerWall is a rechargeable home battery system that maximizes your home's "energy independence." The system is designed to store electricity for backup power, time-of-use load balancing, and self-consumption of solar energy.

That means backup power, a smaller home carbon footprint, and potential savings on your electricity bill. Powerwall is also, according to Tesla, an intelligent system that can be customized to your energy needs, with the ability to charge from solar or the grid, so energy is always available on demand.

Additionally, Tesla Energy provides larger battery energy storage systems, including the Megapack for use with the electrical grid and the Powerpack for enterprises.

The system offers customers the following benefits:

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The Powerwall was officially unveiled in 2015 with limited production. Mass production started in early 2017 at Tesla's Gigafactory in Nevada, USA.

As of May 2021, Tesla has reportedly installed 200,000 Powerwalls.

Powerwall works with or without solar and allows you to store energy for later use. Each Powerwall system consists of at least one Powerwall and a Backup Gateway, which manages the system's energy usage and does energy monitoring.

Like the rest of Tesla's products, the Backup Gateway gets over-the-air updates and can control up to ten Powerwalls. It also learns from and adjusts to your energy usage over time.

When combined with a solar photovoltaic system, solar energy starts to power the house when the Sun rises. The house can tap into the energy grid when more power is needed.

During the day, solar panels often produce more electricity than the house uses, and this excess energy is then used to charge the Powerwall's batteries. Once solar energy is no longer being produced at night, or if the utility grid is down due to a power outage, Powerwall then releases energy back into your home on demand.

When the Sun rises again the next day, the cycle starts again.

When not combined with solar panels, the Powerwall can provide the user with battery backup.

Powerwall will also charge when electricity costs are low and discharge when electricity costs are high, resulting in automatic savings if your electricity rates fluctuate throughout the day. Powerwall will also act as a backup power source by immediately taking over as the home's primary power source when it detects grid interruptions.

Pretty neat.

We've given a rough overview of the system above, but if you want some more meaty details, here is more in-depth system analysis.

Direct current (DC) power is generated by solar panels and stored by all the Tesla Powerwall batteries. However, AC (alternating current) power is used by domestic appliances. Inverters and rectifiers are used to convert the DC to AC.

When solar panels generate DC power, it passes through an inverter to be converted to AC before being distributed throughout your home. If your home has a backup power system, the extra energy not being used will continue to flow, charging your battery. To be stored in the battery, it must be routed via a rectifier and converted back to DC power.

An internal inverter and rectifier are shared by the Powerwall 2 and Powerwall+ to convert electricity from AC to DC. Solar panels need an external inverter; the Powerwall 2's inverter is exclusively for the battery. The Powerwall+, on the other side, comes with a solar inverter. Both types can also be charged via the grid when solar panels do not provide electricity.

The energy stored in the system can be used at any time.

However, there are other times of the day when the electricity that has been stored is more beneficial. For instance, many electricity companies impose high peak charges after sundown, when residences consume more electricity.

You can maximize your electricity savings by using your Powerwall at this time of day rather than the grid.

The quantity of sunlight you receive will determine how many solar panels are required to charge a Tesla Powerwall completely. Given that the Powerwall claims to have a 90 percent round-trip efficiency when charging and discharging, you need about 15 kWh of generated electricity from your solar panels to achieve a 13.5 kWh usable capacity.

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The breakdown of that a typical solar panel system is as follows:

Remember that while the Powerwall is charging during the day, some of your home's electricity will be "draining" some of the solar energy. You must have enough solar panels to charge the batteries and your daily needs.

All of this should be factored in when designing the system (either by getting Tesla or another solar installer to do all the hard work).

A Powerwall installation consists of electrical gear according to the location and local electrical code, at least one Powerwall, and one Backup Gateway.

Powerwall, as with all similar backup systems, can be used to back up all of your appliances (whole home backup) or critical loads depending on your electrical configuration (partial home backup). Powerwall offers a continuous 5 kilowatts of power, often enough to power an entire house during a grid outage.

You can choose which loads, such as lights and outlets, are essential with partial home backup. If a three-phase electrical system powers your house, the appliances you choose to run on a single phase will be supported by Powerwall.

However, Tesla advises avoiding running all appliances simultaneously during a grid outage is always better. If the total power consumption of your appliances surpasses 5 kilowatts, your Powerwall system will shut off.

While one Powerwall can power a typical home, having additional Powerwall systems will let you power more loads and keep your house running for more extended outages because of the extra power output and capacity. Powerwall systems can be stacked front-to-back on the floor or installed side-by-side on a wall or floor.

Each Powerwall needs enough space on the sides for electrical connections and enough ventilation when put side by side.

The Powerwalls are floor-mounted, secured to an adjacent wall, and then linked with specific hardware when stacked back-to-back in groups of no more than three Powerwalls.

Regarding specifications, the Tesla Powerwall features some of the best on the market. The Powerwall is among the best products for storage capacity and power output, but many energy storage devices have good performance.

This is partially due to the batteries' usage of NMC, short for lithium nickel manganese cobalt oxide, chemistry. Thanks to this technology, the Powerwall packs some of the best power and storage capacity of any battery on the market.

Tesla

Here is a list of the main Tesla Powerwall specifications for its latest models:

Tesla's Powerwall+ can produce more energy in full sunlight if it is linked to solar panels or solar-roof shingles. Due to the addition of a solar inverter, the Powerwall+ is both bigger and heavier than the regular model:

The Powerwall+'s solar inverter includes four Maximum Power Point Tracker (MPPT) circuits with a 97.5 percent efficiency. To maximize power production, you can group solar panels with up to four different orientations and connect each group to a distinct MPPT circuit.

Tesla

The Tesla Powerwall is more expensive than competing battery systems, but you also receive more power and storage for your money.

A typical single Powerwall installation will currently cost around $10,500, while ordering two will come in at a slight discount for two at about $17,000 ($8,500 each), depending on the number of units. You can obtain them directly from Tesla, but you can also get them via nearby solar installers and authorized third-party suppliers.

If you live in the United States, the 26% Federal Solar Tax Credit (ITC), which applies to Powerwalls as well as other battery systems, effectively lowers the cost of a single unit to around $7,770 (down from around $10,500). To be eligible, you must, however, fulfill a few conditions:

Depending on where you live, your state government or utility provider may offer additional solar tax exemptions or other financial advantages before installing a Tesla Powerwall or other renewable energy system. So, ensure you thoroughly research nearby incentives and the criteria for participation.

However, there are a few other considerations to bear in mind if you're considering purchasing a Powerwall:

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Depending on where you live or if your local authority is incentivizing installing air conditioning to condition your home, you might wonder if Tesla's Powerwall can handle the energy demands of these systems.

As it turns out, according to HVAC experts, a single older unit probably doesn't pack enough punch, but two, or even three, is a viable strategy. More modern units, like the Powerwall+ or Powerwall 2 should also be able to handle a single air conditioning unit too.

You can supply your home's essential demands with just one Powerwall. For example, lights, electrical outlets, and small appliances up to 120V are included in this capacity. The Powerwall's output capacity, which restricts the total power it can deliver at once, must be considered.

A single Powerwall can produce about 5 kWh of power at any time. According to this output, the Powerwall won't be able to handle too many appliances operating at once if they consume more than this amount of energy.

For reference, typical domestic-scale air conditioning units, like single-split, or multi-split systems, tend to range between about 1kW and 3kW per hour.

The restricted output of the Powerwall's design makes a long battery life possible since Tesla promises that this product will function for ten years. However, you will require more Powerwall units if you require a higher production output.

One can see from the technical details offered by Tesla here that they do say a single 5kW+ Powerwall should be enough for most smaller air conditioning units. Larger ones, however, will likely need at least two.

You can power many of your larger household appliances concurrently if you install two Powerwalls, a popular option for many homeowners. With the additional functions of running a central air conditioning unit or heat pump, an electric oven or stove, a good pump, and a Tesla Electric Vehicle charger, you will still have all the functionality of the single Powerwall.

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Therefore, for it to be supported, the central air conditioning unit must be compatible with it. The amount of Powerwalls you need to run will depend on the compressor it employs.

You can determine if you can operate your unit with two Powerwalls using the LRA information, commonly referred to as the Locked Rotor Amp rating. This unit will work if the LRA number is blank or marked Non-Applicable.

Two Powerwalls can also support this unit type if the LRA number is less than or equal to the RLA number (Running Load Amps). This figure is significant because it indicates how much energy is required to turn on the air conditioner. Usually, starting the appliance uses more energy than maintaining it does. The Powerwall must therefore be able to supply this initial energy requirement.

In some situations, running a few particular central air conditioning units will call for at least three Powerwalls. You will want three Powerwalls if your air conditioner has a Scroll Compressor with an LRA of more than 140. There will only be a need for two of these sorts of compressors with an LRA under 140.

Paying attention to the LRA on this design type if you use a reciprocating compressor is especially important. Two Powerwalls should function well if the number is under 55. There would be a need for three Powerwalls if the LRA is 56 to 83. To support this powerful central air conditioner, you will need 4 Powerwalls if the number is between 84 and 111.

We hope you've better understood Tesla's groundbreaking Powerwall technology. But, you might be wondering, are they worth the initial investment?

There are plenty of reviews on sites like YouTube, but the actual reasons you would want to install one depend on how you use energy at home. However, with energy costs set to skyrocket over the next few years, any strategies you can employ to reduce your energy demand from the grid will pay you dividends in the long run.

However, here are some of the main reasons you might at least want to consider getting your hands a one or a couple.

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Powerwall lets you store some excess solar energy when combined with solar panels. You'll use less grid power and get more from your solar energy.

Since the lack of adequate storage solutions for renewable systems like solar panels is one of their significant criticisms (and for good reason), the Powerwall is an excellent way to further justify investing in renewable solutions for your home.

For this reason alone, if you have solar panels, getting a Powerwall is a no-brainer (if you can afford it).

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Another significant benefit of Tesla's Powerwall is that installing it could let you become grid-independent.

This means lower electricity costs but can also increase energy security and reliability.

Becoming grid-independent can also potentially boost your house value. It's excellent to generate and store your energy.

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Tesla's Powerwall comes with an extended warranty of a decade. These warranties are for homeowners and Tesla-approved installers.

This makes your investment in Powerwall more secure and makes Tesla's product worthwhile. Many reasons make extended warranties great, but one of the most important is that they can offer a risk-free investment to customers.

These warranties also indicate Tesla's confidence in its products' durability.

For reference, here are the current Powerwall warranties;

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Tesla's Powerwall is also an excellent investment because it has backup power. This makes them invaluable for power outages in rural or urban locations or areas with variable and unpredictable power supplies.

You can keep your food cold and the TV on in a blackout. You can even share your self-generated power with your neighbors.

By leaving the grid and becoming independent, you'll be covered in a blackout or other disaster. This is one of the main reasons that existing customers have already invested in this technology.

A Tesla Powerwall is a long-term investment, like solar panels. Waiting for battery prices to drop may be costlier than buying one.

This is because having a battery saves more money than waiting for a price drop. However, you start making a profit after paying off the initial investment.

Your ROI is boosted even more if you take advantage of any incentives that may be available to you in your area.

VPP stands for Virtual Power Plants, which are considered the future of energy. VPPs are a network of decentralized, medium-scale power-generating units and flexible power consumers and storage systems.

They provide homeowners, the government, and the environment with several benefits.

The idea of them is gaining in popularity, and they could provide affordable energy year-round with no price hikes. Tesla's Powerwall can let you join a VPP and decrease energy expenditures.

And that is your lot for today.

Tesla's Powerwall has been making significant waves in the domestic energy market for several years, which is unlikely to change soon. While the installation cost is significant, it is essential to note that they could yield considerable savings in your energy costs, especially over the coming years.

Investing in a Powerwall or two is an excellent idea when combined with solar power or other forms of renewable technology. If, of course, you can afford to. For those with smaller budgets, as the production scales, you might want to keep an eye on the prices as they become more affordable.

Who knows, a healthy secondhand market may even open up very soon.