SolarCity Introduces Energy Storage With Tesla Battery Technology (w/video)

DEC 10 2013 BY MARK KANE 15

SolarCity storage systems will initially be available in few states

SolarCity storage systems will initially be available in few states

Recently, SolarCity announced the launch of DemandLogic energy storage units with Tesla battery technology for new solar power business customers.

Initially, the offer is available in areas of California serviced by Pacific Gas & Electric and Southern California Edison, areas of Massachusetts serviced by NSTAR, and areas of Connecticut served by Connecticut Light & Power.

The aim is to reduce businesses’ peak demand and provide backup power during outages with the potential of saving thousands on energy costs.

How? SolarCity will add DemandLogic energy storage to solar installations.  SolarCity will come up with optimum customized battery pack sizes and instead of upfront costs, SolarCity will charge payments, which should be lower than a businesses’ costs without the energy storage system.

Our performance promise

DemandLogic is backed by a 10-year guarantee that promises that you’ll get the demand reduction that we predict each month or we’ll pay you the difference. The system also carries a full warranty. We cover all repairs and insurance.”

The whole system is smart, which mean that a controller is learning and automates the discharge of stored energy to optimize utility charge savings for customers.

Peter Rive, SolarCity’s chief technology officer and chief operations officer said:

“Utilities have altered their rate structures such that demand charges are rising faster than overall energy rates, and businesses are bearing the bulk of those increases. Time is money, but so are control and predictability. Our storage systems can give businesses the tools to address all three—delivering immediate savings, protection against escalating demand charges and optional, grid-independent backup power in case of outages.”

The important thing is that the SolarCity concept requires no change in operations for the business and is fully automated. According to SolarCity:

“…DemandLogic can also power IT functions, security systems, cash registers and other critical business systems during power outages. SolarCity analyzes each organization’s energy usage to design a storage system that can offset peak load and support high priority backup functions.”

Tesla CTO and co-founder JB Straubel commented:

“We are thrilled to leverage Tesla’s technology leadership in energy storage systems, charging and power electronics to enable this exciting SolarCity launch. The economics and scale that Tesla has achieved in the automotive market now make stationary energy storage more cost effective and reliable than it has ever been in the past. We expect this market to grow very rapidly now that we have crossed this economic threshold.”

SolarCity argues that the utility grid is aging and outages are increasing with 679 major weather-related power outages between 2003 – 2012 in the U.S., including 7 of the 10 costliest storms in American history.

The second argument is that since 2001, electricity usage in the U.S. increased by about 10%, but utility revenues have increased more than 50 percent – in part due to introducing new “demand charges” for businesses.

Anyways, this seems interesting for both SolarCity and Tesla Motors and we look forward to seeing how it develops.

Categories: Battery Tech, Tesla

Tags: ,

Leave a Reply

15 Comments on "SolarCity Introduces Energy Storage With Tesla Battery Technology (w/video)"

newest oldest most voted
David Murray

I guess this will help drive demand for more batteries, which should help economies of scale and lower the price for everyone. Maybe Tesla can eventually open that “gigafactory” we keep hearing about and sell batteries to solarcity.

io

Hmm, yes, but batteries for automotive applications have quite different requirements than for stationary use. For the first, weight and safety are key, whereas cost is probably what dominates the second — hence the popularity of lead-acid for such installations so far.

Now if the idea is to start creating a market for faded EV cells… that could make sense.

Elon Musk stated on twitter that the cells for Solar City aren’t the same ones in the Tesla cars. They’re lower Wh/kg, so there aren’t any contention issues between SC and Tesla for cells.

I don’t think they’d end up using cells from the gigafactory for SC (presumably they’ll all be needed for EVs) but perhaps the capacity Panasonic, LG, Samsung and others are ramping now at 200-250Wh/kg would be used for SC (otherwise, Panasonic is just ramping capacity for the next 3 years and then will find itself high and dry).

pjwood

“Demand Charges” -there’s that term again. I didn’t know they were going up in relation to rates. That will hasten the demise of the existing utility model.

Tesla probably plans to pass along lower wh/kg car batteries, perhaps on top of more cost effective SLA installs. PG&E and SCE (the big Cal Utils) have been pretty vocal about prohibiting battery back-up. It’s one thing to avoid demand charges, and another to arbitrage TOU rates.

Some years from now, we’ll all look back and remember what a sweet deal charging at night was.

GeorgeS

pj,
Just got a note from APS in AZ. relative to TOU rates. They are now forcing all new solar users on a TOU plan. They are doing this because they need more revenue from solar users.

Interesting that SCE doesn’t want people to have battery backup. They must be worried about losing revenue.

io

SCE is a “decoupled” utility. Like all IOUs in California, its revenue doesn’t depend on how much electricity it sells.
http://www.aceee.org/sector/state-policy/california#Alternative%20Business%20Models

I couldn’t find where it supposedly “prohibits battery backup”. Source please?
I wouldn’t be surprised if SCE had strict requirements regarding feeding stored power back into its grid, effectively making small-scale projects financially uninteresting though.

Spec9

Right now, it is to the advantage of Solar PV people to be on TOU rates since the solar PV time is peak rates and night-time is off-peak rates. But as the amount of solar increases, day-time may no longer be peak rates. The evening will be the peak-rate time since there is a lot of demand around 5 to 9 pm when people get home and solar has largely stopped producing.

Dave R

Exactly. But with just a small amount of storage, one should be able to largely negate the majority of that evening peak.

If you want to see what this evening peak looks like today, have a look at the CAISO “Today’s Outlook” page (they also have historical data under the “Renewables Watch” logo:

http://www.caiso.com/Pages/TodaysOutlook.aspx

You can see that right now in the winter there’s actually two peaks – at 8am and 7pm.

Solar is peaking at 12pm (wow, nearly 3 GW today!), but it doesn’t start producing until the sun gets up around 7am and by 5pm it’s done – just before the evening peak starts ramping up.

Now this is winter demand – in the summer the demand chart looks completely different with a big peak around 3-5 pm and a small bump around 8-9pm. In the summer solar is just starting to taper off around 4pm so it’s still good for most of the peak thanks to the tracking that gets installed on most larger solar installs.

Spec9

IMHO, batteries for PV systems are only for distant off-grid homes, doomsday preppers, and very rich people who are willing to pay many additional thousands of dollars to not lose power on that once or twice a year time you have a power outage.

They are generally not worth it for most grid-tied PV systems. Just additional cost and maintenance for almost no benefit.

Mark H

That is mostly true for today, but could change based on utility company mandates. I am in favor of net metering. If the utility companies choose to only pay wholesale for my electricity then I will start the research for a battery back-up. I do not have a problem if the utility company makes money off of me during peak hours, but I have a big problem if they try to gouge me otherwise. There can always be a model for net metering. Anything else will be up for grabs as the technology changes.

io
Net metering is great, but only scales so much. It can only be offered as is by utilities as long as there is no cost impact on regular (non-generating) customers. I’ve not paid a cent for electricity since I got solar. I’m using the grid as a big battery, for free. For now, it’s not a bad deal for my utility, since I’m producing power locally, during the day and more in summer, where and when it’s most valuable, and consuming mostly the same amount at night and in winter, when it’s cheaper, yet I get no compensation for the price difference (I’m totally cool with that, btw). Now if solar becomes so popular almost every house has it, peak rates will shift maybe to winter evenings, so expect to see at the very least TOU made mandatory for net metering customers. Also, the grid has to be maintained and ready to power customers loads like if solar wasn’t there (I don’t have a contract with my utility saying I need to keep producing, or warn them of downtime — I can decide to turn my system off at any time), so I’d expect to see some minimum “grid connection… Read more »
Bonaire

The $15K units hold about 10 kWh of standby power. If they keep the energy storage SOC in a use-range of 10% to 90% for longevitity, then that is 8kWh of drainable energy storage. They say it should be used to “save a business money”. How many $15K units should be deployed to help someone save money? And how much money? It only seems to be applicable to California installs under rate plans which impose a peak-demand penalty fee.

SCE prohibiting battery backup? They’re kind of a rotten utility company to begin with but this takes the cake. AS if forcing smart meters on customers isn’t bad enough (PG&E).

The whole purpose behind demand charges is to encourage less peaky demands. How are you supposed to do this without batteries? Hypocrites!

If they are worried about not having adequate supply once the batteries go dead, there is such a thing as “90% of the peak yearly demand”, and also “Demand Contracted For”, which is usually used for larger commercial and small industrial customers, and is a variation of the “contracts” typical in Europe and Asia. This assures the utility is adequately compensated.

ModernMarvelFan

That is unnecessary and very expensive…

mmf, what is unnecessary?