Tesla Wins Energy Storage Contract In Australia – 129 MWh / 100 MW


JUL 7 2017 BY MARK KANE 50

Tesla won the world’s largest energy storage order in Australia so the 100 MW-scale, 100 days challenge in now underway.

The California company will deliver 100 MW/129 MWh system by December 2017 in South Australia. The system will be combined with Neoen’s Hornsdale Wind Farm near Jamestown.

Well, it’s a lot of batteries – like the equivalent of 1,300 Model S (or more).

The Tesla ESS will help to produce more energy from renewables as well as will help solve power shortages, reduce intermittencies, and manage summertime peak load to improve the reliability of South Australia’s electrical infrastructure.

Elon Musk stated that the Australian project will have three times the output of the next biggest battery installation in the world.

If Tesla fails to deliver within 100 days, the system will be free for Australian utility, as per Musk’s own earlier Twitter brag and reconfirmed this week – see video below (Musk stated the deadline begins once the grid interconnection agreement has been signed)

“Last September, a 50-year storm damaged critical infrastructure in the state of South Australia, causing a state-wide blackout and leaving 1.7 million residents without electricity. Further blackouts occurred in the heat of the Australian summer in early 2017. In response, the South Australian Government as a leader in renewable energy, looked for a sustainable solution to ensure energy security for all residents, now and into the future, calling for expressions of interest to deploy grid-scale energy storage options with at least 100 megawatts (MW) of capacity.

This week, through a competitive bidding process, Tesla was selected to provide a 100 MW/129 MWh Powerpack system to be paired with global renewable energy provider Neoen’s Hornsdale Wind Farm near Jamestown, South Australia. Tesla was awarded the entire energy storage system component of the project.

Tesla Powerpack will charge using renewable energy from the Hornsdale Wind Farm and then deliver electricity during peak hours to help maintain the reliable operation of South Australia’s electrical infrastructure. The Tesla Powerpack system will further transform the state’s movement towards renewable energy and see an advancement of a resilient and modern grid.

Upon completion by December 2017, this system will be the largest lithium-ion battery storage project in the world and will provide enough power for more than 30,000 homes, approximately equal to the amount of homes that lost power during the blackout period.

Working in close collaboration with the South Australian Government and Neoen, this grid scale energy storage project is not only sustainable, but will help solve power shortages, reduce intermittencies, and manage summertime peak load to improve the reliability of South Australia’s electrical infrastructure. In addition, Tesla’s Powerwall is now being installed for residential customers across Australia and ramping up quickly. The same technology that can help stabilize the South Australian grid can also be used by homeowners to collect energy during the day so it is stored and made available day and night, providing uninterrupted power even if the grid goes down.

Tesla is proud to be part of South Australia’s renewable energy future, and we expect this project will provide a model for future deployments around the world that will help significantly accelerate the adoption of sustainable energy.”

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50 Comments on "Tesla Wins Energy Storage Contract In Australia – 129 MWh / 100 MW"

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Can you explain this line:
“The Tesla ESS will help to produce more energy from renewables”

Since batteries have round-trip losses, it takes more renewable energy into batteries than you get out. If the renewables are producing at say 100MWh per day, you will store that much and take out less than 90MWh per day. Batteries as a buffer are a net energy consumer and do not “help to produce more energy”.

So, let’s try to understand that battery buffers are useful for grid stabilization, holding excess energy for a later time and other tactics. Batteries do not produce energy. They are a net energy consumer. 11% or more. Early powerpacks were worse than 89% round trip efficient. Hopefully it keeps getting better as internal resistance of batteries reduces.

Batteries help enable a greater portion of the energy mix to be obtained from intermittent renewables. I agree it was poorly worded as the batteries themselves are net energy consumers (as you point out).

I really just want it presented truthfully. More and more now, you hear of people saying “these batteries will power something….” Well, no they will dispatch stored power but they must get that power from something.

Effectively, these are like both spinning reserve power and hydro. They are at the ready for instant response. They have capacity to get through short-term peak demand or a grid base load plant shutdown cut-over. They can help stabilize voltage and frequency like a peaker plant. But they are not “new magic” but rather are a new lower-cost solution that grid operators were looking to get into once Li-Ion came down in price. 10 years ago, the cost of Li-Ion freq. response systems were $2000/kWh.

The problem with renewables is – the price came down just enough to cause more installations of renewables which now leads to a more unstable grid – which leads to a need to spend again and buy batteries to smooth things out again. So, renewables just got more costly.

Bonaire – I find it ironic that you want information presented truthfully then immediately make an untrue statement like “installations of renewables which now leads to a more unstable grid.” There are plenty of studies to the contrary that show more distributed production, like is the case with consumer- and utility-scale renewable power plants, the latter of which are nearly all in the 10’s or 100’s of MW or less, leads to better grid stability. On top of that, any newer plant is required to meet much higher standards for capacitance, frequency response and ride-through, which helps prevent trips and blackouts versus an older fossil plant that lack the ability to deal with instability and thus just trip offline leading to regional blackouts.

Sure there are future projections of needing additional work to balance production and consumption, but stating that grid stability is harmed is just an outright lie.

It’s not an outright lie. Those studies show that small additions can help the grid. What we’ve seen in Hawaii and California (among other places) show that high levels of intermittent power do destabilize the grid. Hawaii had to stop rooftop solar rollouts while they rebuilt their grid to be more robust. And California pays intermittent producers not to produce and because they cant control the smaller producers ends up selling power (at negative rates) out of state to keep the grid from becoming unstable when renewable production is very high. And selling your power out of state is a clever fix but it’s not one that EVERYONE can use. If every state had the same surplus then no one could use that solution. The solution itself isn’t scalable to higher intermittent production levels. I don’t really get your point about newer plants being designed not to trip out. How is that some kind of proof that renewables don’t lead to grid instability. That’s more an indication that the grid itself is being redesigned to deal with the issues renewables produce. We’re going to need storage to make the grid more consistent when the power sources are inconsistent. This will… Read more »
My point is that confusing stability with supply is at least as bad as an offense to “accurate reporting” as saying that batteries “help produce energy.” If the former is “untruthful” by the poster’s standards, then the poster’s statement is “an outright lie.” That was my point. If you want to get on your high horse about being super accurate with terminology, turning around and saying that renewables reduce grid stability is just ridiculous. Sure, there are correlations with both, I’m not arguing that. Just don’t be a hypocrite. The equivalent is if the article had said having more gasoline tanker trucks help increase supply of gasoline. OK, I agree that’s not totally accurate (having more oil wells and refinery capacity does), but it depends on how you read it. It’s not that much of a leap to say that if you can’t get the supply to the gas station, then it doesn’t matter how much refining capacity you have, you need more tanker trucks (i.e. batteries) to increase supply to consumers. Screaming that the it’s false news that gasoline tanker trucks don’t produce gasoline is fine, as long as you’re consistent – but it’s semantics. So then in the… Read more »

It has actually happened, as I pointed out above. So I don’t really get your idea that we won’t know if it’ll happen because it hasn’t happened yet.

California has this problem already at current levels of small renewables and they’ve only been able to fix it by making it someone else’s problem. Once everyone has this problem that fix won’t be viable. We have to plan ahead so we don’t end up in the mess that would cause.

Limiting renewables until enough storage (or similar through smart grid efforts) can be brought on line may be part of this. And since I don’t want to limit renewables I suggest we push forward on storage rapidly.

But if that can’t be done we may have to limit renewables while we catch up.

Come on, man….relax. The problem you talk about mainly happens in the spring days in Cali when we use less AC. In days like today we don’t have enough solar and wind to flatten the curve during the day so put some context into what you say.

I agree with you about the terminology being confusing. But it’s not un-truthful. The industry speaks of battery storage as “generation”. They even speak of contracts for companies to reduce their demand during high loads as “generation” because both have the same effect of making more power available as generation has.

So I can see being frustrated. And I can see venting that. But in the end you’re going to have to accept this instead of trying to tell everyone else they have to accept your terminology.

So what happens to the renewable energy that gets produced but doesn’t get used ?

Like many residential homes where they produce 2-4 times as much energy during the day (particularly in summer months) than gets used.

It gets wasted is what, therefore, having battery storage helps eradicate that wastage, end result, net energy increased.

It all depends on your point of view

That happened in germany a lot. Wind power can be shut down (changing angle of rotor) if the grid can not take it. Wie Gould habe produced 5-10% more last year if some kind of battery would habe been available. Sure of the 10% more stored you need to reduce the 10% by battery efficiency. So only 9.5% more could have been stored.

It’s not entirely wrong to say batteries hell to produce Mord reneeable energy.

The variability of renewable electricity adds to two fundamental cost issues on the grid.
– Matching production with demand
– Transmission cost.

Those two issues, particularly taken together can lead to curtailment of the renewable generation.

Storage helps with both cases:
– By helping to maintain a steady supply of electricity, it reduces the need for fossil-fuel peaker plants to provide balance
– By having the ability to buffer power, transmission capacity can be built for more typical output instead of extreme peaks. (There is a more general use case for storage on the grid to allow local transmission capacity upgrades to be deferred.)

If all renewables do is reduce need for peaker plants, it has failed miserably to meet the hype of running large populations of energy demand on renewables only.

My alma mater has installed a 2 MW solar array. It will produce to to 3% or their electricity needs. And their heating is done by natural gas. I say “massive scale is still needed” and massive scale of renewbles requires massive scale of smoothing batteries. Effectively, the uphill battle os huge if not adding in large scale conservation efforts and cutting demand sharply. I guess we move more and more industry to China to do that? So far, it has helped lower the USA’s energy demand a few percent.

And there is news that a forthcoming 1600 coal burning plants will be constructed world wide in the next decade or so.

What they mean is that the wind turbine park next door does not need to curtail energy on moments that there is more solar or wind but less consumption.

Your energy observation is correct, and about 90 percent is the maximum. So they are not lying perse, they can prevent otherwise curtailment

How will this impact model 3 production?
Tesla Powerpacks use the same form factor battery as model 3 so…

.. the size is same – 2070, but chemistry is different ..

Tesla produces different cells for powerpacks and for automotive ..

2170 (21mmx700mm)

NCA for cars
NMC for powerPacks

Unless. They determine that NCA is ok for powerpacks when used only for peak load response at perhaps 50-100 cycles per year. Then you can get 1500 cycles in a 15-20+ year period. And as cell prices drop, replacement cells in 15 years may be “even cheaper than today”.

Someone should check to see if a second chemistry is being used for certain powerpack systems which are not cycled daily but used only for peak load balance.


Pretty sure they use the same line though. In the past comments were made that they had started production on the batteries but it was for powerpacks and then more recently began production for the M3 batteries. The implication seemed to be that the two competed for time on the line to some extent

Correct my point exactly, production is done on the same line same factory, Giga.
If production is shifted from model 3 cells, ramp-up will be in jeopardy.

Are you sure cell production is the bottleneck in the production of the cars? Cell production seems very easy and fast to me compared to the assembly of the complete car. Panasonic has years of manufacturing experience in cellproduction.

So I think cell production can easily fullfil both demands.

Stationary storage and cars have different properties so they should have different chemistries.

Cars have limited space for batteries so it is important that the energy density is high. On the other hand, cars usually aren’t driven constantly so the number of recharge cycles is less important.

With stationary storage on the other hand physical size isn’t an issue. However in order to minimize the cost per kWh stored you want a lot of recharge cycles. You probably want to cycle the battery at least once a day for 10 or more years.

Physical size is _less_ of an issue, but it’s still an issue.
You need land for the batteries.
You have to ship the batteries.
You have to install the batteries.
Smaller makes all of those easier.

NCA is cheaper and possibly more prolifit right now given the car sales rate. If there is excess batteries, you might consider using them now and then replace them in years when chemistries mature further with cost of scale decrease in price.

The system would have to dump at 1/2 C or slower (even though rated at nearly 1C for the headlines). It could have a peak draw of 1C for a few minutes then slow down as needed.

I have to wonder if this system will be outside or under a building canopy to keep the sun off the system in Australia which is known for hotter summer days.

Assuming the Model 3 has a 60kWh battery pack, 100MWh is equivalent to the batteries in 1667 cars. If the battery pack is larger, it is a smaller number of cars. Reports say they are already making M3 batteries and they intend to make 1000 cars/week by the end of the year. It is probably less than a one week delay if they have to take all 100MWh out of the M3 battery production – if the reduced car production is spread out over 6 months, they only have to drop production by 60 cars/week. Given the production ramp-up plans, nobody would even notice them dropping 60 cars a week. Of course, this assumes that they can stockpile a large number of M3 battery packs so that they don’t have to halt car production while they make other batteries.

Units. 100MW / 129 MWh

This news makes my heart happy =)

Good news. “100 MW/129 MWh” isn’t typical. Though these systems are spec’d on instantaneous power, duration is what effectively sets the battery order. Here, Musk meets the spec so long as Australia understands the obvious. 100MW will be available for less than 1.29 hours.

I found this in an IHS slide deck, yesterday: “The capacity is not there. Nobody has the capacity”, Thomas Sedran, VW’s head of group strategy. Apparently, IHS is on board with using such info to foster the image regulations can’t be met. Sing chorus, sing.

A good analyst knows Musk will get better margin from the “VW’s” of the world, than the “Australia’s”. Just have to pick up the phone.

Full disclosure: I got back into TSLA, yesterday.

Notice the high power nature. Made me state above that “maybe” it could be higher-power NCA cells versus NMC. Maybe they have built-up some powerpacks with NCA using the “shortage of cells” that ocurred in Q2 with the 100kWh packs given the news cycle this project could lead to.

NCA cycles should be at least 1000 cycles, you’d hope, so you can even have a blended system of some NMC and some NCA and blend power and longevity (some powerpacks made with NCA, some powerpacks made with NMC).

You wouldn’t dump at 100MW rate. More likely, response in-need. “We need 15MW due to a shortage, bring up the batteries.” or “powerplant nearby failed, we need 30 minutes of 100MW now until we spin up all the standby peakers”.

Having 1.29 hours of standby power doesn’t “Fix the Australian power grid”.

I agree. It doesn’t fix a grid problem measured in hours long black-outs, no matter the chemistry we’re talking about. I think your point, like the 2003 northeast blackouts, is well taken. Intermediating during peaks can stop what otherwise would require hours-long repairs.

Longer cycle life was fundamental to how I understand heavier stationary lead-acid got passed over for more expensive lithium. If within the lithium chemistries (which I’m no expert in), they can still find even greater life, than the economies are perhaps better for the long-dated assets utility owners manage. Car buyers don’t take present-value from a battery’s 7th, 8th, 9th… year.

It does fix the grid… it provides a lack of incentives for generation sources to shut down in the hopes of driving up prices, as the battery can be used instead. And it provides time for those generation sources to come online. The problem with their black out wasn’t that they didn’t have the generation capacity, but that they were incentivized to not come online and it took them too long to actually come online later. Installing dispatchable power at the utility side instead of the generation side gives some leverage back to the utility and helps make the generation side behave.

Another move in the right direction.

1.7 million residents….30,000 homes? 56+ residents per home? Do Aussies get that cozy?

One project at a time.

Looking at just the California utility ‘duck curve’ it would appear that just California needs well north of 10 GW and 40 GWH of storage to shave a modest amount of peak off that curve. Imagine how much that becomes if calculated worldwide and with 10 times the solar as current.

The (what?) 6th largest economy in the world barrels through almost 200..trillion..watt-hours per year. That’s plaid, making easier to understand why the state storage nut goes past 1GW.

Nevada’s AB206, which did not pass, would have made 10%, of a 40% RPS, batteries. I don’t know how the text was written, but that could have been a long-dated target for 4TWh/year. 4TWh/365= 11GWh.

There’s so much autocorrect in your comment it is hard to understand but yearly power consumption has nearly nothing to do with my comment. Batteries for peak shaving have to do with the daily peak which right now lasts 3 to 4 hours and is about 10GW–ish for just one major utility. The entire point of the previous California install for Tesla is to absorb some of the excess solar power in mid day to charge the batteries then discharge them at the peak in the evening. Hence a daily power requirement number and not whatever you were typing.

100 days from now is October 15’th, not December…

The 100 day deadline begins once the grid interconnection agreement has been signed.

So in essence, this story is “well timed” due to the recent stock price drop…

While I have no doubt that some news/developments are managed in their timing, I doubt this is one of them…the stock was at ~360+ (~$25 off the high) just last week. It was a pretty quick pullback after the Sunday night Model 3 disclosures/analyst ratings updates.

It’s doubtful they had this project completed in their back pocket, and all the Australian governmental/utility types in a holding pattern, just waiting in the wings to release in case the stock took a dive.

Now if it was a random speculative update on the Model Y…then I think you might have something.

I see, thanks for clarifying. So the contract is not signed yet, this is just an announcement.

As we understand it…it is a done deal. However, with this sort of high level utility/government in play and making a guarantee, you want to make sure you have all your legal and regulatory rights in place.

So if there is a “miss” it is on you, and not some bureaucratic red tape, legal, or planning issue that impedes your progress.

Especially if you have to provide it for free if you miss 😀

Is this what it will take for Tesla to actually meet one of their commitments on time??? We shall see!

It’s an interesting hook to get the big contract for sure, but probably not something that should be repeated too often…cause hey, stuff happens.

California can used about 20 of those 100MW installation to help smooth out the grid a little bit combined with some more wind power.

Great initiative from SA government and Premier Jay Wetherill. I really hope this works out well as SA has had alot of power issues of late.

This is enough for a small town. A drop in the bucket, but a promising start. The future is cheap grid solar. Batteries will never be cheap enough for long term storage, of course, but fortunately other technologies are available.

Solar and batteries lose power capacity every year through degradation. Batteries cycled once a day for 10 years may be as low as 60 % of their original capacity if not made with NMC or Lifepo4 chemistries. in 30 years, solar can be 80% or less output. Any power plant or storage needs expensive maintenance. There is no magic here. Maybe like printer companies, they intend to make money on the periodic battery set replacements that are needed, not the initial sale? Governments may not look at the lifetime costs, only the value of tweets and pressers?

If you actually click on the Bloomberg article you’ll see the consultant company who made these claims, Wood Mackenzie Ltd…Google “Wood Mackenzie” and the top result is:

“Wood Mackenzie: Oil, Gas, Metals & Coal | Data, Analysis”…