Critics Weigh In: Tesla’s Australian ESS Apparently More Costly Than Diesel Generators
After the wave of enthusiasm on the news of latest, and world largest energy storage system (100 MW/129 MWh), to be delivered by Tesla in Australia, some criticism has appeared.
Apparently, new technology costs more than old tech at the start…go figure.
According to a Bloomberg article, the Tesla batteries will be over 60% more expensive than conventional generators.
Wood Mackenzie analyst Saul Kavonic said:
“Given current costs “the reality is South Australians are paying a big price to stabilise their energy supply, after a rapid build-up in solar and wind power generation,””
Federal Resources Minister Josh Frydenberg said in an interview with Sky News said:
“Tesla’s battery plan “is a lot of sizzle for very little sausage. Let’s focus not necessarily on celebrity. Let’s focus on what is needed to stabilize South Australia’s system which unfortunately today has not had a very good record.””
More generators still need to be installed to compensate for shortfall of the battery storage system, as the capacity of the Tesla system (as large as it is, at 100 MW) is still insufficient to cover all the projected demand needs. In 2018 a 200 MW diesel generator will be added, then eventually a 250 MW gas generator.
“The consultancy estimates the fixed cost of batteries in 2017 at $81 a megawatt-hour compared with fixed costs of $9 a megawatt-hour for an open cycle gas plant. The charging cost for batteries is estimated at $57 a megawatt-hour compared with the cheapest gas seen at about $59 a megawatt-hour. By 2025 gas could be more expensive than batteries given the rising cost of the fuel.”