Those without air conditioners have had thousands of dollars added to their electricity bill to pay for the network upgrades to cope with air conditioners, since much of the extra "poles and wires" are used only a few hours a year, when the weather is very hot or very cold.

Now, mass adoption of battery storage systems poses the same risk for those who don't install them. Their adoption will allow households to slash their use of the grid which will leave fewer users faced with higher bills to maintain the network.

Communities of battery users

But for German battery challenger Sonnen, batteries are only part of the energy equation. More fundamental is creating "communities" of connected battery users to create virtual power plants.

Or as Philipp Schroeder, managing director at Sonnen puts it "create a platform where private citizens can share electricity and basically build a utility without a power plant".

Sonnen is already well established in Europe and the US and now it is ramping up its presence in Australia, going head to head with Elon Musk's Tesla, where Schroeder was, until recently, a senior employee.

"We believe Australia will be one of the leading markets when it comes to this style of development, of decentralised peer-to-peer communities," Schroeder says. Its product is more expensive than Tesla's battery system, for example, but as Schroeder puts it the choice is chalk and cheese - would you buy the cheapest car, or focus more on fuel efficiency?

It is a choice the likes of General Electric has also made since, via its GE Ventures arm, it recently took a slice of equity in Sonnen, which is on the Massachusetts Institute of Technology list of 50 most innovative companies.

Establishing critical mass

In Australia, Sonnen is establishing the "critical mass" in terms of installed battery units so that from around mid-year it will launch what it dubs its "community model": an installed base of around 2000 batteries means it will then be able to offer broader services in both the wholesale electricity market and the so-called frequency regulation market.

"There is probably no better market environment than Australia," Schroeder said due to the potential quick payback for rooftop solar and battery storage systems.

With "the highest penetration of PV [systems] extraordinary sun-hours, huge understanding of solar, and the extremely high cost for energy", this all adds up to make the market highly attractive.

"And you also have a grid issue. We can solve the grid issue - stabilise the grid."

For Sonnen's Schroeder the challenge is to create the awareness that installing stand-alone battery storage is not good, because you create "islands", which places additional costs on the grid.

"Why? Because the individual consumer is using less electricity. It is not optimising the grid; it is not even helping to stabilise the grid - rather, it is destabilising the grid," he says.

"Our mission statement is 'clean and affordable energy' for all. It is not 'I am a rich dentist, I can afford power storage and I don't give a damn about anyone else'.

"There are two issues with renewables. One is there is no sustainable business model. It lives off feed in tariffs - subsidies. And no one is able to orchestrate the challenge of millions of decentralised assets which can only produce when there is wind or sun. But this is what we can do."

Taking advantage of renewables

Pressure is building for a business model to emerge to take advantage of the large installed base of renewables energy and, increasingly, battery storage. In Adelaide, AGL is planning to link existing rooftop solar systems into a "virtual power station", using a government subsidy.

But Sonnen is already advancing down this path, without subsidies, while effectively guaranteeing those with rooftop solar systems and its battery systems pay nothing for their electricity while also having the promise of generating some income from ancillary services it is able to provide to the network.

"There's lots of value in grid services," Sonnen's Schroeder argues. "You don't have to take care of it; you just have to become part of a community of people who unite to replace utilities.

"You never have to pay for electricity again," is the seductive sell.

Its networks not only take advantage of using rooftop solar systems to sell power into the grid when wholesale prices are high but it also opens the door to take advantage of those times when renewables such as wind generate power at times when there is negligible demand, such as at night.

In the world of renewable energy it is not uncommon for power prices to be negative, with wind farms producing large volumes of electricity during the night or the weekend when demand is low or non-existent. Battery systems are able to access this output and sell it at times when prices are high.

Then there is so-called "frequency regulation", with the need to supply ready volumes of electricity to the grid to make up for shortfalls from renewable energy to keep the grid-powered lights on.

Last week, the Australian Energy Markets Commission threw its weight behind changing the so-called 30-minute rule which had effectively blocked batteries from competing in this market, leaving it to the big power companies.

Sonnen's sell

"In the first phase, we sell the hardware, enabling the customer to save 70-80 per cent of their electricity bill. This enables them to amortise their investment within as short as five years, or even seven years, depending on where you live," Schroeder says.

"And then we give you the option to allow us to utilise that capacity to provide additional services."

Sonnen batteries are able to cycle - charge and discharge its batteries - three times a day, which is better performance than rival batteries offered by Tesla or LG, it argues. This extra cycling gives the company the ability to then participate in wholesale markets.

"The [potential] customer looks at a Sonnen battery and sees a Powerwall," Schroder says. Buy the cheapest car or the price per kilometre? "On this basis, we are not even one third the cost of a Tesla battery," Sonnen claims.

"Let's not build [battery storage] islands for rich dentists who can afford it, let's have a responsible platform that enables clean and affordable energy for everyone. Government cannot and will not tolerate 'islands for dentists'."