Tesla has been making big moves on the energy storage market in Australia, but they are now all being dwarfed by this new project that will see them install solar arrays and Powerwalls on 50,000 homes to create the biggest virtual power plant in the world.

The company’s main project has been the 100MW/ 129MWh Powerpack project in South Australia, the largest in the world for now.

But now instead of being a large centralized battery system using Tesla’s Powerpacks, the new project announced today is using Tesla’s residential battery system, the Powerwall, to create decentralized energy storage, which basically results in creating a massive virtual power plant.

South Australia Premier Jay Weatherill announced the deal today – the biggest of its kind by far.

The 50,000 homes in the state will be fitted with 5 kW solar arrays and 13.5 kWh Tesla Powerwall 2 battery systems.

It will result in at least 650 MWh of energy storage capacity distributed in the state.

Tesla said in a statement:

“When the South Australian Government invited submissions for innovation in renewables and storage, Tesla’s proposal to create a virtual power plant with 250 megawatts of solar energy and 650 megawatt hours of battery storage was successful. A virtual power plant utilises Tesla Powerwall batteries to store energy collectively from thousands of homes with solar panels. At key moments, the virtual power plant could provide as much capacity as a large gas turbine or coal power plant.”

It will function much like Tesla’s giant Powerpack system, which charges when demand and electricity rates are low and discharges when demand and prices are high.

We reported last month the single battery system managed to make around $1 million in just a few days.

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Arizona’s utility regulator, Andy Tobin, proposed a new energy modernization plan which will update Arizona’s policies on clean energy, storage, biomass, efficiency, vehicles and more.

The sweeping plant, seems to be an intelligent look at the most modern techniques, combined with pragmatic decision-making – to clean a power grid.

Currently, Arizona has a 15% renewable energy mandate by 2025, a goal which has already been met. This new proposal will see that increase to 80% by 2050, “with the ultimate goal of being 100%.” Nuclear power is included in the clean energy target.

For energy storage, a new target of 3GW by 2030 will be set per the original reporting on the topic by Utility Dive. The proposal cites:

“Low priced, and sometimes free electricity, is being exported from surrounding states; at the same time, increasing peak demand in Arizona is causing new expensive investments for ratepayers.”

The smartest thing I’ve ever heard someone do is taking advantage of ‘free stuff.’ California has paid Arizona take electricity in the past.

This 3GW of storage target is the largest volume target so far, California is second at 2GW – however – California’s number is by 2020. If we compute the targets on a per capita basis – Arizona has 6.9 million people versus California’s 39.2 million – we’d have to see California reaching 17GW of energy storage by 2030.

Bloomberg suggests the USA will have about 75GW of energy storage by 2030 – California has a habit of leading the country, and I expect California to blow past 17GW by then – possibly being as much as (or far more depending on doubling pace) 37.5GW (50% of US total).

Technologies that qualify as energy storage include: electrochemical (batteries), mechanical (flywheels/compressed air), thermal (molten salt), and gravitational (pumped hydro).

The proposal sets a target of 90 MW of biomass generated from the ‘treatment’ of 50,000 forests by the end of 2021. Only “high-risk fuel,” sourced 80% from within Arizona, will qualify toward the 90 MW of required biomass energy production.

In another example of renewables coming for gas peaker plants – Arizona’s new proposal includes a new “Clean Peak Standard”, where utilities will be required to use renewable resources during peak hours – with the logic that it’ll drive energy storage construction.

These renewable fed energy storage plants, simply by existing on the network, will probably also offer ancillary services like the Australia 100MW/129MWh Tesla Battery, but it will also be requested to do something much bigger – eating the ‘duck curves’ that arise as a result of growing daytime solar power production.

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AES and Siemens are combining their efforts to launch new energy storage startup called Fluence Energy and compete with Tesla Energy in the fast-growing, new energy storage industry.

The new company is off to a strong start as the supplier of the soon-to-be new world’s largest lithium-ion battery-based storage project.

Today, the company announced that they received “all government approvals and authorizations and the launch of business operations on January 1, 2018.”

Stephen Coughlin, president and CEO of Fluence, commented on the launch:

“We continue to believe in and deliver on the promise of energy storage to reduce costs, improve power systems, and create a more sustainable future. However, we saw customers struggling to find a trusted technology partner with deep knowledge of the power sector and the ability to deliver an industrial grade solution they could count on to be there in the future. With a team drawn from both Siemens and AES, we are fluent in the power sector and bring the capabilities, global reach and experience to make sure our customers achieve the full value of storage.”

Fluence will become the supplier of AES’ Alamitos power center energy storage project in Long Beach, California serving Southern California Edison and the Western Los Angeles area.

The 100 MW/400 MWh is expected to become the biggest in the world – beating Tesla’s 100 MW/ 129 MWh project in South Australia in energy storage capacity and reaching parity with Tesla’s power capacity record.

The new startup listed some of its energy storage features in a press release:

• Bankable, proven and industrial-strength technology platforms optimized for different customer needs, including speed of response, long-term dependability and integration with other power resources;
• A comprehensive set of services and warranties covering the entire energy storage journey, from early-stage commercial analytics through the full operations and maintenance life-cycle of a project;
• The broadest set of energy storage grid applications including power generation, transmission and distribution alternatives, renewable energy integration, and commercial and industrial applications;
• Full turn-key installation and support services in more than 160 countries, tailored to meet specific needs and conditions; and
• A suite of financing packages through a new partnership with Siemens Financial Services, including leasing and project finance options.

AES and Siemens claim that the new startup instantly became the new world leader in energy storage with “nearly 500 MW deployed or awarded across 15 countries.”

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On January 3rd, New York governor Andrew Cuomo delivered a state energy storage target of 1500MW via the private market by 2025 and has put up $260 million in state money to help drive the investment.

In the annual “State of the State” address, varying proposals  – from combating MS-13, to cleaning up the Hudson River, to expanding clean energy jobs – were delivered to start the new year. The energy storage target delivered seems to be an extension or culmination of prior state legislation requiring targets be set.

The 20th proposal of New York’s State of the State address was specifically directed at “clean energy jobs and climate agenda.” Here are the key sub-components of the legislation:

• Expanding the Regional Greenhouse Gas Initiative (RGGI) and reducing emissions from the highest-polluting, high demand “Peaker” power plants
• Issuing solicitations in 2018 and 2019 to develop 800MW of offshore wind while developing the job ecosystem surrounding the industry
• A 1500MW energy storage target, a $200 million fund at the state Green Bank to help drive pricing down for energy storage through strategic deployment
• A “Zero Cost Solar for All” program for 10,000 Low-Income New Yorkers
• NYSERDA being directed to invest at least $60 million in storage pilots plus other activities that reduce barriers and costs when deploying energy storage – such as developing smarter permitting, customer acquisition, interconnection, and financing processes

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Solar power and energy storage (batteries) have fallen in price enough that they’re now competing with the cost of natural gas peaker plants in specific markets. New analysis is suggesting 10GW of natural gas peaker plants are at risk through 2027 in the USA specifically.

Other, more aggressive suggestions don’t see a place for gas peaker plants after 2020 in the USA. It seems the age of the renewable energy plus energy storage power plant is upon us.

Part of the use of Tesla’s 100MW/129MWh project is an example of this in the real world. So is the collection of projects in California that partially replaced the natural gas plant at Aliso Canyon (which Tesla also participated in). Elsewhere in California there are discussions to replace two additional peaker plants in the near future, and one large gas power plant, that regulators say are systemically important to the grid with batteries.

The two Tesla battery power plants – and peaker plants in general – are participating in an electricity market that pays for filling gaps with fast response time electricity during times when electricity demand changes (like in California as the sun goes down and everyone goes home).

A report in Minnesota suggested that right now, the net cost of a solar power plus storage power plant is cheaper than a natural gas peaker power plant – as seen in the right two columns in the graph below. In fact, energy storage alone – without the cheap electricity coming from a renewable plant – is almost the same cost as a peaker plant.

Major CEOs of power companies have also suggested, in a much more aggressive time frame, that peaker plants will go away entirely by 2020 in the USA.

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National Grid announced this week that its project for a 48 megawatt-hour battery energy storage system on the island of Nantucket has been greenlit and Tesla has been selected to provide the batteries.

Nantucket is a small island of about 10,000 permanent residents about 30 miles off the Massachusetts coast, but it’s also a very popular touristic location.

The island’s electricity is currently supplied via two submarine cables that connect to the mainland transmission system on Cape Cod.

It results in a critical failure point, but the island’s power is still secured with two six-megawatt diesel generators acting as backup power.

Now National Grid explains that those two generators are reaching the end of their useful life and need to be replaced.

The company is looking ahead and sees that the island’s electricity demand is increasing and they would likely need to add a third submarine cable within the next decade or so.

Therefore, they instead suggested the 6 MW/48 MWh battery energy storage system with only one new generator. This way, the battery system can act as backup for short interruptions in power and the generator can kick in to recharge the batteries if needed.

But maybe more importantly, the battery system will also serve to reduce peak demand from the island and stabilize the grid.

With this system, National Grid believes that they can delay adding a third submarine transmission line by at least another decade.

Rudy Wynter, president and COO of National Grid’s FERC-regulated Businesses, commented on the announcement yesterday:

“The BESS provides a very efficient and effective solution to two major energy challenges facing the island. Our customers, communities, and policymakers look to us to deliver innovative solutions like this to help advance our clean energy future.”

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Almost every automaker working on electric cars is also currently looking at ways to leverage their battery technology development into other products. It started with Tesla’s launch of ‘Tesla Energy’ in 2015 and now BMW, Renault, Nissan, and several others have also launched similar products or even new energy divisions.

Daimler has its ‘Mercedes-Benz Energy’ subsidiary and the company unveils today an impressive new project using its vehicle battery packs for stationary energy storage.

The German automaker is putting aside 3,000 battery modules from its production for the third-generation smart electric car toward a new energy storage facility managed by enercity, a German electric utility, in Herrenhausen.

They have already installed 1,800 battery modules out of the total 3,000 and they announced today that they brought the system online.

It is being used to balance out the important amount of solar and wind energy on the German grid:

“In the event of increasing fluctuations in electricity feed-in from renewable energies such as wind and solar energy, such storage units help to ensure optimum balancing of the grid frequency, which must be constantly stabilised. With their storage capacity, they balance the energy fluctuations with virtually no losses – a task which is currently predominantly performed by fast-rotating turbines, rotating masses in large power stations. Around half of the planned system strands is already coupled with the network with an output of 5 MW.”

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Reality is, that most people who want solar power on their home actually want energy storage as well. We want energy storage because if the grid goes down, we want our house to run smoothly – day or not, sunny or cloudy. Additionally, many of us hold onto the dream of disconnecting from The Man.

At SolarPower International 2017 it was clear that the solar+energy storage hardware market – SolarEdge, Sonnen, BYD, Kehua, Outback, Hauwei, Schneider and others – are almost ready (or in terms of Sonnen/SolarEdge/Schneider – ready today) to serve the home energy demands of the broader population.

First, a small bit of education. The large majority of solar power installations installed today need special wiring/extra hardware in order to keep pumping electricity into the house when the grid goes down – this is due to ‘anti-islanding‘ laws. It’s probable that your solar system will also shut down when the grid goes down. This will change.

Outback and Schneider are the old-time players in the off-grid solar market that I’m most familiar with. The Outback FlexPower is a respected package of hardware (first image on the left below). Personally, my favorite installation was of a Schneider system I developed for a close friend at their off-grid cabin in the western hills of the Rocky Mountains (four images to the right below – including their pool). These systems offer all of the wonders of modern life – including the aforementioned pool.

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Good news for Canadian electric car drivers or soon-to-be electric car drivers. A new network of DC fast-charging stations has been announced to cover the Trans-Canada Highway in a currently underserved region between Ontario and Manitoba.

Interestingly, the stations will be equipped with energy storage systems in order to make sure it can deliver fast-charging even where there are grid limitations.

Jim Carr, Canada’s Minister of Natural Resources, commented on the announcement:

“Canada recognizes the key role electric vehicles will play in reducing emissions from the transportation sector. With more electric vehicles becoming available, we want to make them an easy choice for Canadians. This strategic investment brings us closer to having a national coast-to-coast network of electric vehicle charging stations while growing our economy and creating good jobs for Canada’s middle-class.”

The project, which is expected to cost CAD $17.3 million (USD $13.6 million) and is partially funded by Natural Resources Canada (NRCan), is a partnership between 3 energy storage companies: eCAMION, based in Toronto, Dallas-based Leclanché North America, part of Switzerland’s Leclanché SA and SGEM based in Geneva.

They describe the stations:

“At the core of each station will be FAST Charge’s state-of-the-art, energy storage system featuring advanced lithium-ion batteries with scalable capacity that will draw and store energy from the grid for use by charging units whenever required. Each station will have three charging units to allow three vehicles to be charged simultaneously.”

Unfortunately, they didn’t confirm the charge rate beyond confirming that it will be DC fast-charging – though they did say that it will support “level 3 or beyond”, whatever that means…

They plan to start manufacturing the systems during the first quarter of 2018 and start installing them as they are produced. They want the entire network to be online by the first quarter of 2019.

It should cover “a total distance of approximately 3,000 kilometers or 1,860 miles with the stations spaced approximately 100 kilometers (62 miles) apart.”

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In order to support its growth, the company is expanding in the country with new Supercharger stations and new stores.

The automaker announced yesterday that it opened three new stores and completed the expansion of Asia’s largest Supercharger station over the last week alone.

They wrote in a press release (translated from Chinese):

“In the fourth year since our introduction in China, Tesla continues to strengthen its commitment to investing and expanding the service network and facilities in order to allow more Chinese customers to join us and to experience intelligent, convenient and environmentally friendly pure electric mobility.”

One of the new stores they opened last week is located at the ‘Galaxy COCO Park’ in Shezhen:

It’s the fourth store in the Shezhen region. They are also adding 3 more Supercharger stations around the city.

A few days later, Tesla opened a store in Chengdu – the second store in the region:

Along with Shezhen and Chengdu, Tesla also opened a store in Shanghai’s Taikoo Hui district last week.

The new location is Tesla’s sixth in the city, which is the automaker’s biggest market in east China.

Finally, Tesla is also continuing its Supercharger expansion in the country.

Last month, the automaker announced a greater than anticipated expansion of its fast-charging network, which especially involves installing more charging stalls per station.

Tesla’s Supercharger stations had an average of 6 stalls per station and the biggest ones had between 8 and 12 stalls. A few had up to 20 stations, but now Tesla is planning stations with dozens of Superchargers – even some with between 50 and 100 stalls.

In China, they have 530 Superchargers at 110 different stations. Last week, Tesla expanded the Supercharger located in Beijing Huamao Center to 20 stalls – making it the largest in Asia.

It looks like China remains an important market for Tesla in the short-term, especially since the recent success that they have been having the country. In the long-term, it will likely involve local production, which has been rumored for years, and the introduction of the Model 3.

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