This report builds off the Solar Futures Study by exploring how its results and findings could be impacted by the growing industry trend of hybrid systems comprising PV-and-battery (PVB) technologies. At the end of 2020, there were 73 PVB projects in operation on the U.S. bulk power system, comprising more than 1 gigawatt (GW) of PV capacity. An additional 830 PVB projects—comprising 150 GW of PV generation capacity—have been proposed in U.S. interconnection queues to come online by the end of 2026 (Bolinger et al. 2021). To evaluate the impacts of PVB hybrids on the outcomes and findings of the Solar Futures Study, we employ the same ReEDS model and Reference and Decarb scenario definitions,2 but we perform two versions of each scenario: one in which PV and battery technologies must be deployed separately (“No Hybrids”), and one in which the model has the option of deploying them together as PVB hybrids (“With Hybrids”). The With Hybrids versions of each scenario include two exogenously defined PVB hybrid configurations, which involve a shared bidirectional inverter3 and PV and battery sizing that correspond to the greatest PVB hybrid deployment under the Solar Futures Study scenarios explored. The first exogenously defined PVB hybrid configuration involves sizing that is comparable to standalone PV systems, and the second involves a more forward-looking configuration with a significantly oversized PV array and a larger coupled battery. Through comparison of the No Hybrids and With Hybrids versions of each scenario, we isolate the potential impacts of hybridization on total PV deployment, PV’s share of total generation, the role of battery storage, transmission expansion, and bulk power system costs. In addition, we separately explore the impacts of the emissions reduction requirement (“Decarb-ModCost”) and aggressive cost-reduction trajectories (“LowCost”) to understand potential interactions between the evaluated policy and cost drivers. Note that this scenario analysis was performed prior to the Inflation Reduction Act (U.S. Congress 2022) being signed into law in August 2022, which introduced an investment tax credit for standalone storage technologies, among other provisions. For the model formulation presented in this report, representing the Inflation Reduction Act provisions could reduce the competitiveness of PVB hybrid technologies, since standalone storage systems would receive similar federal tax credit incentives.
