This is the first article of a two-part series that goes over going off-grid with solar from a financial standpoint. Stay tuned for Part 2 and subscribe to our newsletter to be the first to know!
In many countries, including Indonesia, the idea of going off-grid with solar and being energy-independent is becoming more and more popular. After all, what’s not to love?
You get to reduce your carbon footprint and no longer depend on non-renewable energy sources. It also looks super easy. You just need to install some solar panels, and voila, you’re off-the-grid, right?
Well, hold that thought! Using an off-grid solar system is a little more complex than that.
How solar panels work
Remember, solar panels need direct sunlight to produce energy!
In Bali, Lombok, and many parts of Indonesia, this translates to an average of 4.2 kWh (kilowatt-hour) per kW of solar installed.
When there is cloud cover or rain, your power output will drop. At night, it won’t produce any energy at all.
This chart shows how PV system output goes up and down throughout the day.
With a grid-tied or on-grid solar system, this is not an issue as your system will automatically draw electricity from the grid, whenever needed.
With that being said, when you are off-the-grid, you no longer have the grid as a backup for your power needs when the solar panels do not produce energy. This is why backup energy storage, i.e. solar batteries, are essential in an off-grid solar system.
Solar panels do not store energy and without batteries, you won’t be able to get a constant energy supply to power your building or equipment.
How much does it cost to go off-grid with solar and batteries in Indonesia?
Now, on to the most frequently asked questions when it comes to going off-grid. “How much does it cost?” and “Is it worth it?”
To answer these questions we must go through the following steps:
1) Define your daily energy requirement
This can be done in several ways:
List down your appliances, power requirement or wattage of each appliance, and how many hours you use them every day
Use a metering device
If you are connected to the grid, use your average monthly electric bill and divide it by the current tariff/kWh (kilowatt-hour)
For example:
Monthly power bill (PLN): IDR 2 million per month.
Tariff per kWh in 2021: IDR 1.589,17/kWh (with tax)
Energy requirement: Approx. 1,258.5 kWh per month or 42 kWh per day
2) Calculate the size of your battery system
After figuring out your daily energy requirement, you can size your battery accordingly. Taking the previous example with 42 kWh of daily energy requirement, your battery system needs to be at least this size to cover a full day’s usage.
However, in tropical countries such as Indonesia, you must take into account that there will be some days when you get little to no output due to heavy rain or cloud cover.
To compensate for this, you can either:
Size your battery system approximately 100% more than your daily requirement. With a 42 kWh daily energy requirement, this brings your battery size to 84 kWh.
Pair your off-grid solar system with a generator as an additional power supply during a heavy rain day. With this approach, you can go stick with 42 kWh and purchase a generator
Adjust your electricity usage during a rainy day. This might not be feasible if you run a business, but if it’s for private use only it is something you can consider.
Based on that, you have two options:
Battery system for 1 full sunny day: 42 kWh + generator for a rainy day if needed
Battery system for 1 full sunny day + 1 rainy day: 42 kWh x 2 = 84 kWh
It is also likely that you will encounter several days with little to no sunshine per year, in which case you will have to size the battery system even bigger or add a small generator to prepare for the worst-case scenario.
In any case, don’t worry, we can help make your system size more cost-efficient.
Contact us for a FREE consultation by email at info@smartenergy.tech or WhatsApp at +62-812-3742-6724.
3) Calculate the size of your solar system
For an off-grid solar system, the capacity of your solar array must be able to offset your electricity consumption during the day and charge your batteries simultaneously.
As previously mentioned, in Indonesia you get an average of 4.2 kWh per kW of solar installed.
With that in mind, you would want to be able to charge your batteries in 3 hours (or even faster in cloudier areas) so that you can still have some surplus for day use on sunny days, and can charge the batteries fast enough during cloudier days.
For example:
Battery size: 42 kWh
Hours to charge: 3 hours
Solar to charge batteries: 14 kWp
4) Calculate the final system cost:
The average pricing of a solar system in Indonesia is IDR 15 - 21 million per kWp installed and even less if for larger installations.
For the batteries, you can expect to pay an additional IDR 10 - 12 million per kWh for LifePO4 lithium batteries, which give you the biggest bang for your buck.
Keep in mind that while there are cheaper battery types, such as lead-acid batteries, our lithium batteries come with a much superior lifetime and performance. In our case, our smart battery system offers 6,000 discharge cycles (around 16-year lifespan if discharged every day) and a depth of discharge of 90% as opposed to life acid which usually offers no more than 50%.
If you compare them apple-to-apple you’ll find our lithium batteries at the same price per kWh, if not cheaper.
With that being said, going back to our example:
Battery system size: 42 kWh
Solar to charge batteries: 14 kWp
System cost: Approx. IDR 600 million
All that for a household with an IDR 2 million power bill, which can easily get away with a 7-10 kW grid-tied system - which costs approx. IDR 130-170 million - to heavily reduce its power bill per month.
Is it worth it to go off-grid?
Unless you are unable to connect to the PLN grid investing in an off-grid solar system doesn't make financial sense.
Generators are a hassle to maintain and can be expensive to fuel, especially in remote areas. You can expect to pay around IDR 4.000 - 10.000, depending on where you are located, to fuel a conventional generator.
If you were indeed planning to use a generator, then investing in an off-grid solar system with lithium batteries instead makes a lot of sense as it will provide a very attractive return on investment (ROI).
Is there any way to make off-grid solar more affordable?
Thankfully, there is!
The answer is also quite simple: energy efficiency.
Energy efficiency is a very important aspect of modern life that is often overlooked.
In the second part of this series (which is to be released soon!), we will go through two real-life examples of how we make going off-grid more affordable for two of our clients.
Be sure to subscribe to our newsletter to receive an update on the second part of this series and let us know if you have any questions by email at info@smartenergy.tech or by WhatsApp at +62-812-3742-6724. We hope to hear from you soon!
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