(Repeats with no changes)
* Mediterranean Nice hosts large grid power storage trial
* Batteries store midday solar power, release in evening
* Battery storage still too expensive in most of Europe
* Demand response increases or delays power consumption
By Geert De Clercq
NICE, France, July 5 (Reuters) - A major pilot project by Europe's largest power network operator to integrate power from rooftop solar panels into the grid has shown that battery storage of renewable energy is not yet economically viable in Europe.
The conclusion is a sobering one for proponents of sun and wind energy because as more of it comes on tap, better storage will be needed to keep the power produced when it is sunny and windy so it can be used at other times.
The 30 million euro "Nice Grid" pilot is one of the biggest in a European Union-backed "Grid4EU" scheme in which France's EDF, Italy's Enel, Spain's Iberdrola Czech Republic's CEZ, Sweden's Vattenfall and Germany's RWE are testing the power grids of tomorrow.
In the Mediterranean village of Carros on the outskirts of Nice, EDF's power grid unit ERDF has connected compact batteries to solar panels on rooftops and utility-size batteries to its local power distribution network.
The technology works perfectly but the pilot has shown it is still too expensive for wider rollout.
"The economic model of the batteries is not mature yet," Philippe Monloubou, chief executive of French grid operator ERDF utility told Reuters.
A quarter of Europe's power already comes from renewables. This may rise to 50 percent by 2030. But the intermittent nature of solar and wind power requires flexible grids, the ability to respond to the ups and downs of demand and, crucially, cheaper power storage.
French company Saft, which sold the batteries for the Nice pilot, has already installed 80 MW of battery storage around the world, mainly in remote areas in Canada, South America and Africa, or on islands where they compete with expensive diesel generators as a back-up source of power.
But in Europe, they come up against cheaper back-up power from gas-fired power plants and large, efficient grids.
In Carros, which has total solar capacity of 2.5 megawatt/hour, ERDF has connected 20 lithium-ion batteries to rooftop solar panels. Residents themselves have no control over the 4 KWh batteries - which are similar to Tesla's 7 KWh Powerwall batteries - which are run by ERDF.
ERDF has also hooked up two 100 KWh batteries to soak up solar power of several dozen residences, two 600 KWh batteries linked to the low-voltage grid and one linked to the high-voltage grid, for a total cost of under 2 million euros.
Software developed by France's Alstom regulates the flow of power on the Carros network, and is already widely used in other cities and countries.
But the cost of batteries is the project's Achilles Heel.
From the Nice pilot, ERDF has learned that battery storage in Europe costs 500 to 1,000 euros per kilowatt/hour (KWh), with an extra 30 percent for installation and the inverters that turn direct current solar power into the alternate current used on the grid, an ERDF official said.
At that level, battery storage would already be economically viable in certain parts of Germany and Denmark, where renewable energy use is most advanced and where retail power rates, at around 30 eurocents per kilowatt/hour (KWh), are among the highest in Europe, according to Eurostat data.
But that is not the case for France, where residential power rates are around 17 cents per KWh, and most of Europe, where power averages about 21 cents.
"Economical feasibility is usually not a given in most of mainland Europe's grids," acknowledged Michael Lippert, head of Saft's new energy storage unit.
Some analysts expect the tipping point for batteries in Europe could come around 2020. The ERDF official said it is hard to forecast by how much more the cost of batteries would have to fall to become viable for grid storage. "That is one thing we will have to evaluate at the end of the Nice pilot," he said.
Compared to the cost of solar panels, the cost of batteries has been slow to fall, but as renewables become a greater part of Europe's energy mix, the need for technologies to overcome the intermittency problem will also increase, which is why Saft has set up a division for utility-scale power storage.
The Nice Grid pilot has also experimented with "demand response" systems to use discounted tariffs to encourage citizens to use more electricity when sunshine is abundant and less during winter evening demand peaks.
Some 200 households signed up to let ERDF temporarily switch off their heaters or hot water boilers during winter evening peak consumption using the new "Linky" smart meters which France plans to roll out nationwide in coming years.
Another 70 customers signed up to receive an SMS warning the day before an expected sunny day so that they can benefit from midday power prices that are 33 percent lower.
"I switch on my washing machine when the sun shines," Carros resident Lara Muzzarelli told reporters in her red-stone villa.
Around Europe, distribution system operators are running several pilots as part of the Grid4EU scheme, including Czech Republic's CEZ Distribuce, which tests Combined Heat and Power (CHP) generation and Spain's Iberdrola which is testing the integration of electric vehicles into the grid.
ERDF has several pilots in France, testing the integration of different kinds of renewable energy in rural and urban areas and with different storage technologies. The French government will decide in the coming year on a wider roll-out of some of these technologies in larger cities. (Editing by Mark John and Anna Willard)