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Inmany countries, the integrationof growing shares of residential solar photovoltaics is beginning to challenge existing electricity systems. First, residential solar photovoltaics aggravates sharp system-wide load changes and, in turn, increases theneed for fast-ramping generation capacity. Second, it reduces the demand for electricity provision fromthe grid, causing an increase in electricity prices as grid costs are recoveredover smaller volumes of electricity. Battery storage (BS)mitigates thefirst integration challenge byflattening the system-wide load, but elevates the secondby increasing self-consumption behind-themeter. In face of this dilemma, the integrationof high shares of residential solar photovoltaics requires policymakers to re-designpublic support policies. In this article, wedevelop an agent-basedmodel to simulateCalifornia’s residential ‘solar-plus-storage’market between 2005 and2030 in four different policy scenarios. By applying amulti-technology,multi-policy approach,wequantify the complex interplay between thediffusion of individual technologies, several interactingpolicies and systemic challenges.Our results show thatCalifornia’s policy status quo initiated aBSuptake and, in turn, a flatteningof the system, but, in the long run,will increase the electricity prices. To avoid this,we outline a policy reorientation—including a gradual phase-out of the prevailing feed-in remuneration andan introductionoffixed charges for owners of solar photovoltaic systems.Our results imply that the policy debate should be re-focused away froma single-technology single-policy perspective towards a system integrationperspective.Neglecting this couldnot only jeopardize the affordability of electricity and climate changemitigationplans, but also put at risk the reliability of the electricity supply system.With investment costs of renewables expected to continue to decrease, this further implies that even countries without public support for renewables are likely to face challenges associatedwith their integration.

Addressing integration challenges of high shares of residential solar photovoltaics with battery storage and smart policy designs