Tesla and its implications: it’s a wild time

If you read our piece Tuesday on Tesla’s new PowerWall battery storage announcement, but spent the past three days thinking about whether you wanted to get one for your own home, well, you waited too long.

According to several reports, Tesla has sold 38,000 PowerWalls since its announcement a week ago, and is now sold out through mid-2016. Not terribly surprising since its Nevada Gigafactory to manufacture batteries for both its cars and electricity storage use won’t even be completed until then.

Perhaps more significantly for the future of clean energy, Tesla also has sold 2,500 of its larger PowerPacks. Those are the systems designed for commercial, industrial and utility purposes. And those 2,500 batteries will surely store a lot more power and enable a lot more renewable energy deployment than will the larger number of home systems.

That’s especially true since, as several media outlets reported (perhaps a little too gleefully),  the home systems aren’t–yet–particularly useful for going off the grid or even enabling rooftop solar owners to store their own power generated during the day and use it at night.

SolarCity, the rooftop solar company of which Tesla’s Elon Musk is chairman, isn’t even marketing the smaller (7 kw) battery that would serve that purpose. Again, not yet.

All batteries are designed for specific purposes. In this case, the 10 kw PowerWall is intended only to handle the occasional power outage experienced by the grid and thus enable consumers to have some (although a quite small) amount of backup power to keep some essential systems running. It is designed to cycle only about 50 times/year.

The smaller 7 kw battery is designed to cycle much more frequently–a few hundred times per year–making it suitable for rooftop solar owners to store their electricity and use it on a daily basis. But SolarCity won’t market it right now because current net metering policies (in which rooftop solar owners sell excess power back to utilities) established in most states make more economic sense for homeowners than saving their power and using it later.

Some other companies, and there are a growing number planning to sell the PowerWall,  may market it for the purpose of homeowner energy independence, but for the most part, that’s still a few years into the future.

So does all this mean that Tesla, and electricity storage generally, is not the fundamental game-changer, the new paradigm, that we and many others described it as just a few days ago?

Not at all. As we wrote Tuesday, “What Tesla is doing–and we’re just at the very beginning of this transformation–is changing the entire nature of electricity generation and distribution.” Let’s emphasize “the very beginning of this transformation.”

The significance of Elon Musk’s Tesla battery-powered announcement is two-fold: first, Tesla has dramatically lowered the cost of electricity storage, and has done so even before its Gigafactory is in operation. Mass production will lead to both lower prices and greater capacity. Tesla competitors will also have to up their game and develop lower-cost batteries. Second, Tesla is doing this with the precise intent of entirely transforming the nature of electricity generation and distribution, and of moving the entire world–as quickly as possible–to a clean energy future.

Indeed, Musk already is saying that Tesla’s energy storage business could become larger than its automobile business  –and Musk isn’t shy about his intent to make his car business compete with the General Motors, Toyotas and Hondas of the world.

As nuclear engineer Arnie Gundersen has famously pointed out, “The nuclear industry would have you believe that humankind is smart enough to develop techniques to store nuclear waste for a quarter of a million years, but at the same time humankind is so dumb we can’t figure out a way to store solar electricity overnight.”

We have now figured it out. And we’ve figured it out in a way that is beginning to make economic sense. This is following the solar trendline itself: first, the technology was developed and matured; then the cost became accessible; and finally, where we are now: the cost has dropped to the point where it is not only competitive, it is increasingly the lowest-cost option and will be so nearly everywhere before the end of this decade.

But it’s not only Tesla; they have competitors both in the battery storage arena and other storage technologies. For larger, utility-scale uses, for example, compressed air storage was figured out by the ancient Greeks; now it’s becoming a viable technology and competitor to Tesla’s PowerPack.

As EarthTrack’s Doug Koplow pointed out yesterday, the economics and trends are clear: storage beats nuclear power.

It’s not going to be instantaneous. The change will be nearly invisible for a while. We’re in the very beginning. But the energy transformation is happening–right before our eyes. Don’t close them too long, or it may even pass you by. It’s a fascinating, hopeful, wild time. The clean energy future and accompanying end of nuclear power and fossil fuels are nearly in sight, and will become so blatantly obvious even Exelon will be able to see it. In fact, Exelon and its ilk already do. That’s why they’re thrashing about greedily trying to get as much as possible in their waning days before their obsolete technologies and utility structures all come crashing down around them.

For those of you interested in the more practical side of the issue; this article compares the costs of Tesla’s PowerWall with other currently available residential storage systems.  This post from Australia’s ReNewEconomy features a downloadable app that will help you determine what level of solar and storage will be appropriate for where you live while a post from Rocky Mountain Institute discusses how much battery storage your rooftop solar system may need.

Michael Mariotte

May 8, 2015

Permalink: https://safeenergy.org/2015/05/08/tesla-and-its-implications-its-a-wild-time/

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