Frequently asked questions about the Battery Storage Incentive
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Battery storage basics
A battery storage system integrates into a home's electrical system and allows for the storage and use of electrical energy, measured in kilowatt hours (kWh). Battery systems differ in how they can be used:
- Some battery systems can be configured to enable them to be discharged at certain times of the day when energy costs more. With the right application, batteries can help smooth demand spikes, reduce the burden on the grid and lower a customer's demand costs.
- Some battery systems can be configured to provide backup power during an outage. For example, to supply a separate electrical panel that only serves important devices such as air conditioning units, refrigerators or medical equipment.
Not all battery products can perform both functions. Residential battery storage systems are an emerging technology and different vendors offer a variety of options. SRP recommends that customers consult with their installer and/or battery manufacturer to discuss product capabilities and options.
Battery systems allow customers to store energy from Distributed Energy Resources (DER) such as solar panels, or energy from the grid, for use later.
Battery capabilities vary by manufacturer and model. If you are planning to configure your battery storage system to augment usage during particular times or otherwise offset your power use or household demand, review your options carefully to ensure the system you plan to purchase is capable of accomplishing your goals. SRP recommends that customers consult with their installer and/or battery manufacturer to make sure the product being selected can perform the functions they desire.
Electrical storage capacity, measured in kWh, varies by manufacturer and product. Systems recently installed in SRP's service territory have commonly been capable of storing in the range of 10 to 14 kWh. For example, a typical 10 kWh battery could power a 3-ton (4 kW) air conditioning unit for about two hours on a continuous basis. Consult your contractor for details on options and product capabilities.
Battery storage system longevity depends on many factors: how often the system is used, the state of charge, temperatures (both internal and external) and how fast electricity is used over a specific period of time. We encourage you to discuss this topic with your supplier.
Costs and incentives
SRP offers up to $3,600 ($300 per kWh-DC) for residential customers who purchase and install qualifying battery storage systems and agree to participate in SRP's battery research study. The incentive will be offered beginning May 1, 2018, for up to 36 months or until the 4,500 limit is reached. The incentive is limited to one per residence.
Prices vary depending on manufacturer, size, configuration and contractor. According to recent SRP customer data, an average-sized residential battery storage system costs roughly $8,000 to $14,000. Under this program, a 10 kWh battery would qualify for a $3,000 incentive. A 12 kWh or larger system would qualify for the maximum $3,600 incentive.
At this time, only lithium-ion battery storage systems that have been certified to UL 1973 or UL 9540 qualify for the incentive. SRP may consider other commercially available technologies in the future.
After commissioning, when new meters are installed and the battery system is operational, an incentive check will be processed and mailed to the customer or their designee. Allow up to six weeks for processing.
Program eligibility and price plans
This incentive is available on a first-come, first-served basis for up to 4,500 SRP customers. There are three steps to this process:
- Complete a reservation application form to reserve your spot or call the Connected Home Team in customer service at (602) 236-4448.
- Within 90 days, secure a licensed contractor and submit your full Distributed Energy Resource (DER) application and installation details.
- Once the DER application is approved, you have six months to complete the installation and have it certified by SRP.
If SRP does not receive the DER application by the 90-day deadline the reservation code will expire, but customers can reapply if the program is still available. This approach is designed to give customers the convenience to reserve an incentive while exploring eligibility and technology options before securing a contractor.
You will have six months from the date your distributed energy resource (DER) application is approved by SRP to complete installation and receive all the required approvals from your city/town or county, and SRP. If your installation takes longer than six months, due to reasonably documented delays in the procurement of battery equipment, SRP may extend the six month deadline, at its discretion.
At this time the program is only available to residential SRP power customers.
Only applications received on or after May 1, 2018 are eligible for the incentive.
Both customers with and without solar systems are eligible for the program. The battery system must be installed at a residential property that is served by SRP electric service to qualify for the incentive.
Yes. Solar customers on grandfathered price plans can participate and keep their existing price plan for the length of their grandfathering period.
Due to current meter technology associated with M-Power, SRP's prepay program, a customer who wants to install battery storage must switch to any other SRP price plan. If adding a solar system at the same time, they must switch to one of SRP's solar price plan options. M-Power customers that switch to any other price plan are subject to SRP's standard residential deposit requirements. See our residential credit policy for more details.
You can install a battery system and stay on your existing price plan (except M-Power). However, only customers on an SRP solar price plan or a grandfathered solar price plan will be able to receive bill credit if their battery system sends excess energy generated and stored back to the grid.
System design and installation
- Contractor selection: As with any home improvement project, its ultimate success depends on choosing the right contractor. Get advice to help you make an educated choice.
- System type: There are different types of systems and costs can vary widely. You should research the system types available to select the best type to meet your goals.
- Battery purpose: Not all battery systems provide the same functionality. Consider the options regarding battery chemistry, configuration and functionality in making your selection.
- Temperature: Temperatures in the Valley can easily reach 120 degrees. Make sure the battery system you choose is designed for the environment in which it will be installed. Review applicable warranties as they sometimes include temperature among conditions.
- City rules: City codes may affect battery system selection and may determine where a battery can be installed at your home. Consult your contractor and relevant municipal codes and regulations.
Within SRP's service territory, we commonly see residential applications installed inside a garage. Check your local codes.
Contractors with a valid Arizona license are allowed to install qualifying battery systems. Dealers must have one of the following license types: B-, KB-1, KB-2, R-11 or CR-11. Installers must have one of the following license types: R-11 or CR-11. The Arizona Registrar of Contractors website, www.azroc.gov, lists all licensed contractors in the state. This site also shows whether the contractor has any open complaints against them.
Because of safety concerns, only systems installed by licensed contractors can be certified by SRP and qualify for the rebate.
Some battery systems have the ability to provide backup power during a power outage. Ask your contractor if the battery system you are considering has a transfer switch and backup load panel.
Currently, only battery systems that are charged by an on-site renewable energy source, such as solar panels, are eligible for the 30% federal tax credit. The State of Arizona also has tax credits for equipment used with renewable energy. Batteries charged with electricity from the grid are not eligible for tax credits. Consult a tax professional to determine your eligibility for any or all of these tax credits.
In the tax year that you purchase and install your battery storage system, SRP will be required to send you an IRS 1099 form if the value of your incentive exceeds $600. To support the 1099 process SRP will need a W-9 form from you.
Not at this time. Battery systems are still new technology. Part of SRP's research goals will be to monitor select systems to learn how battery systems operate when integrated into the traditional electric grid. This data will be used to help improve future customer experiences and accelerate the adoption of new technologies.
It is unclear at this time if SRP customers can save money using batteries. We're providing incentives for batteries so we can research to what extent residential distributed batteries reduce SRP's costs and how we can pass any realized savings along to battery customers.
Battery capabilities vary by manufacturer and model. If you are planning to augment power from the grid during particular times of the day or otherwise offset your power use or household demand, review your options carefully to ensure the battery system you are considering has the capabilities you desire. Discuss your battery storage goals with your contractor.
Customers on a solar price plan or solar grandfathered price plans can sell power stored in their battery systems back to SRP. SRP price plans are structured to ensure that any power received from or returned to the grid is appropriately priced and credited based on the given price plan.
Yes. A demand management system typically monitors only the 'grid supplied' energy demand for your home and not energy provided by a battery or solar system. Since a battery system that is capable of providing power throughout the day can help power your home, you effectively need less power from the grid. Your demand management system will run independently of what the battery is doing, but if the battery is providing energy, your demand management system may not need to control an appliance as often.
If your battery system is configured only for energy backup in case of a power outage then it would have no effect on your demand management system since the system only operates when supplied by grid power.
For specific advice, please contact your demand management system provider.
While not all incentive recipients will be selected to participate in the study, they must agree to potentially participate to be eligible to receive the incentive. Selection into the research study may come at any time during the three-year period between May 1, 2018 and April 30, 2021, depending on the type of research being conducted. If you do not want to participate in SRP's research study and do not wish to receive the incentive you may select the 'opt-out' box at the bottom of Page 6 on the Distributed Energy Resource Application.
Among other potential areas, SRP intends to study how customers use battery systems, how these systems perform in our desert environment, and how residential battery systems affect the operation of the grid. The research study may last up to two years to enable the research to continue over multiple seasonal weather cycles.
SRP and its technical business partners associated with the research program.
If you are selected to participate in the study, SRP and/or its designated contractors will need access to your battery system and other related areas such as your meter, electrical service panel or solar system if applicable. The primary purpose will be to install and monitor test equipment required for the research study. SRP may need to access or modify the research equipment from time to time but will provide customers with advance notice when access to these areas is needed.
SRP and/or its designated contractor will need to install certain test equipment to conduct the research. While the specific equipment may vary depending on the scope of the research, devices like sensors and communication equipment may be installed and need to be modified from time to time. At the end of the study, the test equipment will be removed and all affected areas of your home will be returned to their condition prior to the study.
Yes. You need to notify SRP of any change in ownership of the home by email or telephone within 30 days of such change.