Tesla’s electricity storage plan for Australia – just the start of international developments
Tesla’s $169 Million Battery Play Is Just the Beginning An audacious deal hatched on Twitter may start a new wave of electricity storage for cities, regions, and nations.Bloomberg by Tom Randall March 18, 2017, Tesla is ready to power some grids. And not just in California or Australia.
Last week, Elon Musk wagered he could address South Australia’s energy crisis with 100 megawatts (MW) of batteries installed in 100 days or less—“or it’s free.” The exchange blew up on Twitter and led to phone callsbetween Musk and leading Australian politicians, including Prime Minister Malcolm Turnbull. (Ukraine Prime Minister Volodymyr Hroisman later chimed in that he’s interested, too.)
An analysis by Bloomberg New Energy Finance finds that such a deal wouldn’t only alleviate South Australia’s blackouts, but would also be profitable—at an anticipated cost of roughly $169 million (A$220 million). Battery prices are tumbling fast—by almost half since 2014—and such mega projects are increasingly popping up around the world. …….
The battery storage industry—a key part of the master plan if wind and solar power are ever to dominate the grid—is becoming increasingly important in such places as South Australia. The region gets 41 percent of its electricity from renewable energy, one of the highest penetrations of wind and solar in the world. In 2016 and early 2017, Australia has already announced 220 MW of storage deals, led by Zen Energy in South Australia.
Until recently, batteries were many times more expensive than natural gas “peaker” plants that fire up when supply falls (as when the wind dies down). The South Australia government’s current plan is to address its energy shortfall largely through the construction of a state-owned 250MW gas plant, along with A$75 million in grants and A$75 million in loans to help fund energy storage.
A 400 MWh Tesla project with a price tag of $169 million should be very profitable for South Australia, achieving an internal rate of return of between 18 percent and 29 percent, according to BNEF calculations. That’s based on wholesale energy sales and revenue from additional high-value grid services that batteries are especially well suited to provide…….https://www.bloomberg.com/news/articles/2017-03-17/tesla-s-169-million-battery-play-is-just-the-beginning
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