Dive Brief:

• Battery costs may continue to drop but fears of a mass exodus away from power utilities are still unfounded, according to new research by Moody's Investors Service.
• Moody's believes most customers will be unwilling to make the changes to their power consumption habits which are necessary to leave the utility grid completely.
• The financial services company predicts the capital cost of batteries will need to approach $10 to $30/KWh before the systems can truly substitute for grid power.

Dive Insight:

Battery prices are dropping but are still too expensive for most consumers to really leave behind their traditional grid connection. According to Moody's, the capital cost of batteries today is around $500 to $600 per KWh — "still an order of magnitude too expensive to substitute for grid power," said Moody's senior analyst and vice president Toby Shea.

Analyzing consumption data, Moody's found the size of battery necessary to leave the grid is much larger than commonly believed, and said most other studies on battery size "do not adequately consider the extremely volatile nature of electrical usage."

"Moreover, the lifestyle adjustments required will be unacceptable to most people," the firm said in a statement. "Moody's believes that most people are too accustomed to the convenience and reliability of grid-supplied electricity and will not accept the constant need to be mindful of the battery charge levels, and then to conserve electricity as necessary."

The debate will continue, however, especially as battery prices are expected to continue their slide. Forbes points out that it was just last year when Barclays took the opposite view and argued solar plus storage systems were poised to set off a wave of customers abandoning the grid.