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Tesla in talks with Australian utilities to fix country’s power problems by deploying large-scale energy storage

At the launch of the Tesla Powerwall 2 in Australia yesterday, Lyndon Rive, SolarCity’s former CEO who is now Tesla’s Vice President of Energy products since the acquisition, said that the company is in talks with local utilities to quickly deploy large-scale energy storage.

Prime Minister Malcolm Turnbull recently declared a national energy emergency as parts of the country were under prolonged power outages due to its unstable grid.

We reported last year on a South Australia’s state-wide blackout, which ended up boosting Tesla Powerwall demand by ’30 times’.

The Australia government, which has been known for encouraging fossil fuels, currently counts on peaker plants and “clean coal” to fix the issue, Rive claimed that Tesla could do it better and faster.

He referenced the 80MWh Powerpack station with Southern California Edison in Los Angeles, which they built and brought online in just 90 days.

South Australia would need more than a 80MWh project to stabilize its grid, but Rive seemed confident that Tesla could make it happen. He said (via AFR):

“We don’t have 300 MWh sitting there ready to go but I’ll make sure there are, […] We could install everything and get it up and running within 100 days,”

Tesla would need to dedicate some of the Gigafactory’s capacity on the project, but it’s not impossible.

Rive doesn’t see how new peaker plants and more transmission lines would be a better alternative (via Reneweconomy):

“It makes no sense to duplicate infrastructure. By the time it gets up and running, the technology will be obsolete. It’s going to take years. […] And it still doesn’t address the problem. It’s a bandaid. We don’t need to build more transmission lines. …The only reason we’re building more transmission lines is to address congestion that may happen a few times a year. Storage can fill that gap. Use the existing infrastructure (and add battery storage) and it solves the problem. It really does. And it’s more cost effective. Why go the other path?”

He also made a rare reference to the price of those large Powerpack projects. He said the price varies from $400 to 600 US per kWh depending on the configuration, or about $50 million per 100 MWh project.

The Tesla executive confirmed that they were already in talks with local utilities to make those projects happen and it seems to be getting traction. Atlassian co-founder Mike Cannon-Brookes even offered to help raise the money and help with the local politics in order to get the project going:

Of course, that’s for the Tesla Powerpack 2 and Rive was actually in Australia to launch the Powerwall 2 – Tesla’s residential battery pack.

Australia is a top priority market for Tesla with the Powerwall since it’s a product most popular with homeowners who have a solar array and in Australia, that’s 1.6 million homes. Rive expects that all those homes will add a battery pack within the next decade and they want the Powerwall to be a big part of that.

Here he talks to ABC Australia for the launch:

On a large-scale, the Powerwall could ultimately also help stabilize the grid, but utility-scale Powerpack stations is a better short-term solution.

“With large centralised storage at sub-stations, and solar and storage (in homes and businesses) it will be near to impossible to take down the grid,” he said.

As we reported last month, Tesla just started production of the Powerwall 2 at the Gigafactory in Nevada. The home battery pack is starting to slowly make its way in the US market before going to Australia.

Pre-orders are reportedly high for the product in Australia since the Powerwall 2 can pay for itself in just 6 years under some conditions.

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