Tesla on brink of big battery news, as US energy market gets progressive

The lithium-ion battery industry is on tenterhooks ahead of Tesla Motors’ big announcement on April 30 on energy storage. According to an email sent to investors and analysts, the company will announce a home battery and a “very large” utility-scale battery this Thursday at its California design studio.

The electric car manufacturer’s shares rose the most in almost six months after analysts highlighted the growth opportunity of these energy storage products, which are aimed at providing an alternative to the traditional electric grid.

However, Bloomberg New Energy Finance remains “unconvinced of the near-term economics of residential power storage coupled with solar” – explored in detail in the Research Note Tesla’s ‘home battery’: ripples not waves.  

Last week’s Sparklines piece looks back at how the world’s largest energy economy has progressed over the past few years, declaring: “US energy policymaking has moved from conservative and supply obsessed, to progressive and technologically enabled”.

This observation supports Tesla’s foray into energy storage, and SolarCity’s recent announcement to expand operations into commercial rooftops. The latter company, the biggest US solar power supplier to homes, plans to use $1 billion from a funding package led by Credit Suisse Group to support the installation of 300MW of rooftop solar power for businesses, government agencies and schools.

Across the Atlantic, Germany has been trialling a new way to lower the cost of solar installations by auctioning off subsidies for large-scale PV plants. These first auctions were a success – oversubscribed with 170 bids for a total of 150MW on offer – effectively shrinking the cost of producing solar energy in the country to about a third of the price households currently pay for power .

Germany aims to more than triple the share of its power consumption from renewables by 2050, and was the second most active acquirer of wind power in Western Europe after the UK in 2014 – the former installed 916MW and the latter 1GW.

Our annual Portfolio Hunters report on European wind, published last week, notes: “The shifting focus from Southern and Eastern Europe that started in 2012 continued in 2014, with over 80% of transactions taking place in Western Europe and Scandinavia.”

However this week’s Research Note on the UK Election 2015 suggests that UK onshore wind could lose out to rooftop PV and subsidised offshore wind by 2020 – a likely outcome if the Conservative party gains a majority in the upcoming election. The party promises to end subsidies for onshore wind and allow local people to have the final say on wind farm applications.

Another of our Research Notes on wind from the past week focuses on the Scandinavian market. It remarks that, to date, “Sweden has dominated onshore wind installations in the Nordics”, with current capacity boasting 4.4GW in comparison to Norway and Finland’s 0.5GW each.

Differing tax regimes in Sweden and Norway have been largely to blame for the disparity. However, the analysis states: “Alignment of Norway’s tax depreciation law for wind turbines with Sweden’s, along with plans to scrap Sweden’s tax exemption for non-commercial wind power producers, should lead to a more balanced split of installations across both countries in the future”.

Government policy is also behind the renewed push for wind energy development in India of late – the country’s Ministry of New and Renewable Energy is seeking to create a more conducive investment environment for the renewable energy source, in order to move towards the government’s ambitious target of 60GW wind power by 2022. A Bloomberg New Energy Finance Research Note investigates the initial public offering by Indian turbine manufacturer Inox Wind – a result of this more favourable outlook on wind power in the world’s second most populous country.

Looking east, the sun is still shining on solar energy in the Chinese market, as SunPower agreed to build two solar farms, of 20MW capacity each, in China’s Sichuan Province in partnership with Apple, in the fourth quarter of this year.

Elsewhere in China’s solar market, shares in Hanergy Thin Film Power Group jumped 14 per cent last Thursday alone, swelling its market value to HKD 328.4bn ($42.4bn) – higher than that of Sony. Hanergy’s chairman Li Hejun confirmed his faith in the market as he boosted his stake in the company to 38.1m shares.

BNEF forecasts India missing its target of 60GW of wind installs by 2022

This excerpt from BNEF’s weekly Clean Energy & Carbon Brief was originally published by Bloomberg New Energy Finance. Reproduced here with permission