How lithium batteries can help advance a solar-powered world

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The off-grid solar industry has been transforming lives across the world. In just under a decade the sector has provided 245 million people with access to affordable, clean electricity. According to GOGLA’s Global Off-Grid Solar Market Report GOGLA members and IFC Lighting Global affiliates have sold 42 million products since 2010. And with 840 million people still living without access to electricity, the market for off-grid solar products is expected to continue growing in the years to come.

Off-grid solar products consist of a photovoltaic (PV) module, which generates energy, and a battery to store this energy and provide useful on-demand power for the user. Batteries therefore form a very important component of the off-grid solar industry. Over the years, technological progress has contributed to advances in battery technology and reduced costs, which have supported the evolution of off-grid solar products. Entry-level solar lanterns have evolved to include mobile phone chargers, while multi-light systems are now widely available, along with plug-and-play solar home system kits that run appliances such as TVs and fans.

Figure 1: Example of a plug-and-play solar home system kit offered by off-grid solar company, M-KOPA

How energy storage and other innovations have contributed to the growth of off-grid solar

Continual innovation lies at the core of the off-grid solar industry. Growth within the industry has been driven by innovations in mobile money and pay-as-you-go (PAYGo) technology and business models, together with a confluence of global technology trends in PV modules, LEDs and batteries.

Supported by advanced battery technology, PAYGo has emerged as a solution to address the initial financial barrier that many off-grid households face in accessing solar products. PAYGo allows solar product providers to offer accessible and flexible payment plans to pay for energy ‘as you go’, for customers who typically do not have credit histories or bank accounts. This is made possible in many PAYGo models by ‘mobile money.’ Mobile money has grown rapidly in Sub-Saharan Africa since 2006, reaching 277 million registered mobile money accounts in 2016, and surpassing the number of traditional bank accounts in the region.

Figure 2: Graph showing ‘Yearly Comparison: Global Cash and PAYGo Market Value’ as reported in the Global Off-Grid Solar Market Report, July – December, 2018

The growing importance of lithium batteries within the off-grid solar sector

The off-grid solar industry is dominated by two different battery technologies. Lithium-based batteries are commonly used for smaller products, which have contributed to a larger part of the industry in terms of sales volume. Bigger products like solar home systems have historically been powered by lead-acid batteries, but this is quickly changing.

Since 2010, lithium-ion battery pack prices have fallen by 85%, driven by the considerable growth of the electric vehicle industry and investments made by manufacturers like Tesla and others – as evidenced in Figure 3 below. Concurrently, solar PV module prices have fallen by around 80% since 2009 and the prices for LED bulbs have fallen by about one fifth from 2011.

Figure 3: Graph showing the falling prices of lithium-ion battery packs

Although the average price of lithium-ion battery packs was $176/kWh in 2018, off-grid solar product manufacturers do not have the scale and purchase volumes to access this price level, and are in most cases purchasing battery packs from ‘Tier 3’ battery suppliers for around $250/kWh or more. Lithium-ion battery prices falling to this level though, accelerated the shift away from formerly dominant battery types used in off-grid solar products. The development of super-efficient lighting and appliances has also allowed PV modules and batteries to shrink – in size and cost – whilst providing the same levels of energy service to customers.

The other significant reasons for lithium-ion becoming more ubiquitous in off-grid solar products are their substantial advantages in durability, cycle life, deep discharge capability, and efficiency in comparison to lead-acid and nickel-metal hydride batteries. Ultimately, batteries lie at the core of off-grid solar products and have a huge impact on user satisfaction. With many off-grid solar products being employed in remote areas, with limited access to technicians and replacement components, a more durable battery with a higher cycle life makes a significant difference to the user experience. This shift away from traditional battery technologies – like lead-acid and nickel-metal hydride batteries – in recent years can be clearly seen in Figure 4.

Figure 4: Graph showing types of batteries used in pico-solar products tested by the World Bank Group’s Lighting Global Quality Assurance programme

How battery innovations are driving the future of off-grid solar

While the future of the off-grid solar industry is intertwined with that of the battery industry and the developments that come out of it, the off-grid solar industry is also driving innovation in the way that it uses batteries. Many companies are beginning to make use of smart, remote monitoring systems and Internet of Things technology to monitor their customers’ battery usage and battery performance. This data enables companies to improve battery management, product life, safety and user experience, as well as providing data to feed back into the product design process. For example, battery monitoring can identify if a PV module needs cleaning and send an automated message to advise the owner. Likewise, it can predict when a battery needs replacement and inform the company’s spare parts inventory. At the fleet level, data analytics is helping companies to optimise component and system design.

The use of more reliable, lower cost batteries is enabling the development of super-efficient appliances by companies that are designed for use in off-grid contexts. These appliances include super-efficient radios, fans, TVs, and refrigerators, as well appliances specifically in demand in rural areas of developing countries, such as solar water pumps, electric cooking devices, shavers, and irons.

An advanced understanding in the battery space is also enabling companies to bring affordable, high-quality solar solutions to off-grid customers, while delivering better customer experience. As Harini Hewa Dewage, Battery Technology Researcher at M-KOPA states, “M-KOPA’s business model is based upon a long-term relationship with its customers, and the battery lies at the heart of this proposition. Therefore, sourcing and managing batteries in the field is crucial in order to deliver high quality affordable energy and better customer experience.”

As the off-grid solar industry grows and an increasing number of products reach end of life, it is paramount that systems are in place for the safe and responsible disposal of batteries. Many companies have operations in place for take-back, collection and recycling, though challenges exist with limited recycling partners and an uncertain policy landscape. Collaboration with larger industries that produce a higher proportion of waste and the public sector will be necessary to achieve a cost-effective waste management ecosystem.


This article was originally published in The EES International Magazine. You can access it here. 

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