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Musk says Tesla big battery now more than 80% complete

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Tesla founder and CEO Elon Musk says the so-called Tesla big battery in South Australia is more than 80 per cent complete, and is on track to be switched on in time for the December 1 deadline and the onset of the Australian summer.

“We have also installed more than 80 per cent of the Powerpacks for the South Australia project,” Musk said in a statement accompanying the company’s 3rd quarter results, which as Sophie Vorrath reports included a record loss and a further delay in deliveries of the delivery of the new Tesla 3 electric vehicle.

Customers for Tesla battery storage products are also experiencing delays – in some cases of up to six months according to installers – but that is because of the emphasis put on the South Australia battery project, and efforts to help out Puerto Rico after its ageing grid was destroyed by Hurricane Maria.

The 100MW/129 MWh battery storage project next to the Hornsdale wind farm near Jamestown will be the largest lithium ion battery storage installation in the world when complete, and part of a suite of measures taken to ensure that the lights stay on in South Australia in this and future summers.

“We are well on track to meet our 100-day deadline,” Musk says in the statement. The company won a connection agreement in October, which allowed it to unveil the first half of its installations the same day, and this week won its generating licence for the battery project from the Essential Services Commission.

Part of the capacity will be contracted to the South Australian government for grid security needs – fast response in case of a blackout – while the rest 30MW/90MWh will be deployed by Neoen as an arbitrage play on the wholesale electricity market. See this explainer.

Musk says that energy storage enables a more efficient, cost-effective and sustainable way to build and manage utility grid scale applications, and he expects even bigger installation in coming years.

“We expect this project to lay the groundwork for many similar projects, but at an even larger scale, in the years ahead,” he says .

Tesla has sent solar panels, Tesla Powerpacks and Powerwall energy systems to Puerto Rico in the aftermath of Hurricane Maria, including for this hospital, and is looking to provide  long-term distributed energy to the island.

We are also continuing to expand the presence of solar and storage product placement in our stores and service centers. As a result of these efforts, we are seeing a growing number of Tesla vehicle customers also purchasing our energy generation and storage systems, which validates our strategy to cross-sell these products.

Tesla says its installation of energy storage systems had more than doubled in the third quarter, compared to a year ago, and totalled 100MWh. Most of this was from Powerwall deliveries, and did not include the yet to be finished Tesla big battery.

The company also reported 109MW of solar installations in the quarter, which was lower than previous quarters but represented a higher ratio of direct sales rather than leases, while solar roof installations were expected to “rap slowly” in the current quarter as the production process moves to a new gigafactory in Buffalo.

“As we fine tune and standardize the production and installation process, we expect to ramp Solar Roof production considerably in 2018,” it said.

  

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  • Andy Saunders

    I would have thought a more dynamic allocation of both the energy and power capacity of the battery would be better economically (and for system stability)?

  • Brunel

    How many MWh did his cousin say was needed to prevent the blackout?

  • Phil

    Looking at live S.A power use right now it’s just over 1000 MW
    So this battery alone would be able to buffer 10% of the total demand

    And the comment by some was that this is NOT a battery project of much significance !
    I.E too small.

    From these “little” things massive things grow.

    • Nick Thiwerspoon

      Yep. Add in the 8 hours x 150 MW from the concentrated solar power plant at Port Augusta and the proposed salt-water pumped hydro at Cultana near Port Augusta and you have plenty of buffering in the system. An additional interconnector to Broken Hll would cost maybe $400 mill if the Broken Hill to Buronga line was doubled too. This would provide a direct connection to the NSW grid.

    • Mike Shackleton

      It’s not meant to be a heavy generation replacement. It’s only meant to provide stability to the grid (ie. keep everything in time) and provide power for a short period if a portion of supply drops out until a gas generator can come online.

      Those who complain that it can only supply 100MW would also complain that a screwdriver can’t hammer in nails.

      • Chris Fraser

        That would be agreed. The use of a battery for short term stability is an intended small objective … it keeps negators and coal-lovers smug in their belief that batteries only have a niche market and won’t displace gas turbines. The bigger, secret objective is that turbines will easily be replaced by batteries.

        • Mike Shackleton

          For sure, but when you start talking about high output, long duration power pumped hydro really comes into play.

      • Ryan smith

        Yes it can. use the handle! Wrenches make good hammers too. those government guys are fools comparing to the big banana!

  • johndm

    I believe the concept is that the battery will store excess renewable electricity when it is cheap. That will never be the case until such time the renewable capacity exceeds the total demand which will probably be never. In reality when the battery is called upon to deliver power into the grid, it will be when the renewables are not able to meet the demand or there is a problem delivering dispatchable power from the gas fired stations or the interstate grid connection. Once the battery has delivered power into the grid it has to be recharged. Either it will have to wait until the cheapest power is available, or be recharged asap using whatever power is available at the going rate.
    In effect the recharging will be putting additional demand onto the grid and the cost of the power will be that of the most expensive power being put into the grid at that time.

    • Mike Dill

      John, you are mostly correct, but missing a piece. Part of the capacity of the battery (30MW/90MWh) will be used as you state, buying low and selling high. The other part, managed for the SA government, will be used for emergencies and grid balancing.

      The battery is connected to the Hornsdale wind farm. If the wind is blowing, and the Hornsdale wind farm is generating, the cost of wholesale electricity from the wind farm will be very low. if the sun is shining, the cost of wholesale electricity will be low. Charging at those times will cost very little.

      Right now, for about an hour or two in the summer evenings once the sun is setting, the cost of electricity goes to a very high level. Selling the electricity then will make the battery profitable, and actually lower the price as the total supply is increased.

      The battery can then wait for the wind to start blowing or for the morning to recharge again when the sun rises and the price goes down again.

      • johndm

        Mike, it was the economics of the buy low and sell high I was looking at.
        Irrespective of the wholesale price of the electricity from the windfarm, whilst the electricity to recharge the battery is being diverted from going into the grid, then effectively it’s real cost is that of the highest priced electricity being fed into the grid at the time.
        The same will apply if the windfarm is offline for any length of time and the battery having provided buffering and needs to be recharged in order to be ready to again provide buffering.

        • Mike Dill

          John, I seem to be missing a piece here. I do agree that there will be times that the battery will be nearly empty and nearly useless to the grid. filling the battery when the wind is not blowing and the price is high makes little sense.
          Do you agree that the battery should charge when the price is low?
          Do you agree that selling that electricity at a higher price might make the whole thing profitable?

        • Stephen Thomas

          The cost of energy coming out of a battery is whatever was paid to put it in, divided by the battery’s round-trip efficiency (about 80% for a well managed lithium setup), plus a bit of project cost amortization.

          The difference between maximum and minimum spot prices in any state-scale energy market due to demand variation is always going to be *so* much more than the 20% lost from round-tripping through a battery as to make the battery more than profitable.

          Batteries are already very close to profitable even at residential scale, where the ratio of maximum to minimum energy unit price is far lower than it is for the grid as a whole.

    • Mike Shackleton

      John, SA is already experiencing days when the spot price of electricity dips below $0 during periods of high wind and solar output. There are many more projects coming on stream.

      In reality it will rarely fully recharge and discharge. If the spot price leaps up, it will send power into the grid as long as is required to bring it back down again (10 -20 minutes). Often the high spot prices are due to shortages of 1MW of generation – manufactured shortage if you will.

      It also is there to give gas plants a chance to fire up if a big chunk of generation drops off the grid. This saves gas plants sitting there idly burning gas.

      • Jacob

        Neoen can also buy with its share when the price dips and sell during the peak – a private player making money off the arbitrage but delivering a public service by reducing price volatility.

    • Chris Fraser

      Are you sure that you are not judging the renewable capacity (intended to do the recharge work) just on what is constructed right now ? We should be mindful of the crashing price of solar, the enormous and rising price of fossil generators, and a price on emissions yet to come. Those should weigh upon you as significant factors.

    • Stephen Thomas

      > until such time the renewable capacity exceeds the total demand
      > which will probably be never

      If renewable capacity will *never* exceed total demand, then civilization is boned. We can’t rely on non-renewable resources forever – that’s what “non-renewable” *means*.

      So we need to be working to *make* renewable capacity exceed total demand, which necessarily involves adjusting grid dispatch, demand management and decentralized matching of energy generation to end use as necessary in order to keep the overall supply and consumption system functioning as more and more non-renewable plant reaches end of life.

      The only genuine policy question is whether it makes more sense to do that now or later.

      The biggest downside to doing it now would appear to be the opportunity cost inherent in failing to take advantage of the equivalent value of energy generation already embedded in fossil fuels and uranium. We don’t have to pay to generate that energy because Nature has already stuffed it into the fuels for us; all we pay is the cost of extracting it.

      But given that new renewables-based infrastructure has already been cheaper to deploy per generated megawatt hour over project design life than coal or nuclear plant for quite some while now, and given the rate at which the price of renewables continues to decline, that opportunity cost is simply not worth avoiding any more – *especially* when other factors, like greenhouse gas emission and nuclear weapons proliferation risk, are taken into account.

      The Stone Age didn’t end for running out of stones. Technological improvements did it in, just as they’re currently seeing off the coal fired dinosaurs and their insanely overcomplicated nuclear cousins.

  • Malcolm M

    Modelling for the 3 generator rule in South Australia needs to be redone for the big battery. AEMO’s most recent publication about it notes that this is a deficiency in the analysis. With 100 MW of instant response ready to take over in case any single unit trips, the SA grid should be able to operate with no gas generation if there is sufficient renewable generation. The other constraint to be revisited as part of the modelling is the 500 MW export limit to Victoria via Heywood, when the transmission line and transformers are designed for 1150 MW. These rules have led to a lot of gas being burnt for system stability while wind was curtailed, when a more economically efficient solution was to use batteries for the stability component.

  • Ben Davies

    Here’s what could be a stupid question but could the Tesla battery (or indeed any battery when others get on board) pay a negative price for charging (i.e. be paid to charge) when network capacity is in excess. Or is this negative price just the price at a transmission node?

  • Robert Hargraves

    What actually is the battery cost, reportedly $500US per kWh installed? How many charge/discharge cycles?