Musk says storage orders surge on success of Tesla big battery

In what has been a “phenomenal” year for Tesla – think Model 3 production hell, the Tesla Semi, a Roadster in space – one of the company’s biggest victories has come from a rather unexpected source: the 100MW/129MWh Big Battery system it installed next to the Hornsdale wind farm near Jamestown in South Australia.

That’s partly because Tesla managed to deliver – within 100 days – the largest grid-connected lithium-ion battery system in the world. But it’s mostly because, so far, the Tesla big battery has been a runaway success in its new role in the National Electricity Market as the Hornsdale Power Reserve.

And that’s not just because we say so (although, we do). According to Tesla founder and CEO Elon Musk, the SA big battery has been “exceeding its performance targets significantly,” since its installation.

And that success has lit a small fire under sales of the company’s commercial-scale battery packs.

“Due to the success of this project, we’re seeing an increase in demand for Powerpack, our commercial energy storage product,” Musk said in the company’s quarterly results letter on Tuesday.

“With more electric utilities and governments around the world recognising the reliability, environmental, and economic benefits of this product, it’s clear that there is a huge opportunity for us in large scale energy storage,” Musk said.

As we have reported on RenewEconomy, the Tesla big battery has been having a big impact since it was officially switched on in December – an impact that has extended far beyond the SA grid where it was expected to time shift a small amount of wind energy and provide network services and emergency back-up.

On December 19, for example, when one of Australia’s biggest coal units, Loy Yang A 3, tripped without warning taking out 560MW and causing a slump in frequency on the network, the big battery responded, injecting 7.3MW into the network to help arrest the slump .

Since then it has also been actively bidding in the wholesale electricity market, helping to cap market prices, and helping to bring Australia’s gas cartel to heel.

Tesla has since won a contract for the 20MW/34MWh battery that will be linked to the 196MW Bulgana wind farm and will provide a new greenhouse – Australia’s biggest – with 100 per cent renewable energy.

Tesla has also bid for the new big battery to be installed in northern Territory – to help the local utility to stop wasting money having gas turbines spinning in reserve in case one of them trips off – and is believed to be bidding for other projects in Victoria.

The Tesla big battery will also soon be joined by other projects such as Wattle Point, Lincoln Gap, and the newly announced solar plus battery storage project to be installed next to the Snowtown wind farm.

But it’s not just the Tesla 100kWh Powerpack battery storage module that is capturing interest.

Musk says demand for the 13.5kWh Powerwall 2 for home energy storage remains “exceptionally high”, with orders “consistently above production levels.”

Indeed, Australian installers and consumers experienced major delays as the production focus was switched to the Tesla big battery and to emergency projects in Puerto Rico, where the entire grid was knocked out by a hurricane.

Musk acknowledged those production difficulties:

“Solar deployments were affected by the short supply of Powerwalls for customers who wanted solar plus Powerwall in their house,” he said in a statement.

“While volumes may continue to be impacted by these factors over the near-term, we expect growth to resume later this year.”

Sales of Powerwalls should also be boosted by the deal – again with South Australia – to build the world’s biggest “virtual power plant” and install battery storage systems in 50,000 homes, along with 5kW of rooftop solar.

Musk said the company deployed 143MWh of energy storage products in the December quarter, not including the 100MW/129MWh Tesla big battery, which will be recognised in the March quarter.

“The production ramp of our storage products is just as steep as with Model 3,” Musk said.  “This year, we aim to deploy at least three times the storage capacity we deployed in 2017.”