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Tesla South Australia

Tesla Battery in South Australia completed.

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Elon Musk’s 100MW Tesla Battery in South Australia has been completed – well ahead of its December 1 operation deadline. The array of Tesla Powerpack batteries will be tested over the coming days and we can expect the system to be fully live by next Friday.

Tesla Battery in South Australia 

Tesla Battery in South Australia
Tesla Battery in South Australia (source: Tesla)

The Tesla South Australia battery partnership was first inked back in July when Musk partnered with Neoen and signed an agreement with the South Australian government to create the world’s largest lithium-ion battery. The battery farm is powered by Neoen’s 315MW Hornsdale wind farm and is located adjacent to it in Jamestown, about 200 kilometres north of Adelaide. 

The $50 million system is capable of outputting 129MWh and can be used as baseline power during summer peak loading periods, where it can provide enough energy to power 30,000 homes for eight hours, or 60,000 for four. While this might not seem like a lot and one wonders if another company could have done it for cheaper (91 groups bid for the project), it’s definitely been a great way to raise awareness of energy storage in Australia and its rapidly rising uptake (and rapidly decreasing cost). 

It’s important to note that the Tesla battery is far from a panacea for South Australia’s energy woes – as Tony Wood, the energy program director at the Grattan Institute, told the Sydney Morning Herald:

“Over time, storage can help put downward pressure on prices because it can flatten out peak demand,” Wood said.

“It’s a very useful step in the right direction … but it doesn’t solve South Australia’s problem, even at that scale.”

In the meantime, Tesla continues to burn through cash at the rate of $8,000 USD / minute as they struggle to get on top of the Model 3 rollout. What does this mean for the Powerwall 3? The next 12 months will be extremely interesting for Elon Musk and his ‘blue sky’ investors – we hope they’re able to get all their ducks in a row and Musk can start making Tesla more cashflow positive. 

In the meantime, let’s see how Tesla’s battery works over summer for South Australia! 

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Renewable energy in South Australia

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Industry analysts have advised that renewable energy in South Australia will replace gas as SA’s primary source of electricity within eight years. A report by Wood Mackenzie says that by 2025 battery storage will be cheaper than OCGT (open-cycle gas turbine) plants.

The future of renewable energy in South Australia

Renewable energy has been a huge topic of conversation in South Australia lately, especially after the Tesla South Australia battery partnership was announced earlier this month. Despite having a torrid time of it last year with widespread blackouts, premier Jay Weatherill has been forging ahead with his vision of a state primarily powered by renewables, and has been doing a great job. The Lyon Group recently announced a $1 billion battery and solar farm for SA and there are myriad others on the books.

Renewable Energy in South Australia Jay Weatherill
Jay Weatherill – championing renewable energy in South Australia (source: AFR.com)

The report, created by Wood Mackenzie and Greentech Media Research, forecast that battery costs will decrease by 50% by 2025. Bikal Pokharel, an analyst for Wood Mackenzie, noted that SA’s peak loads are currently managed by the OCGT plants, but this will change in the future. By 2025, Pokarel says, “battery storage would be cheaper than OCGTs in managing peak loads … OCGTs would then be relegated as emergency back-ups.”

“If current cost trends continue, 2025 could very well see renewables and batteries overtake rival generating alternatives in dominating South Australia’s power system, and the region could become a leading case study on managing a power system in transition for other mature markets to follow,” Pokharel said.

If the renewables projects currently on the books proceed, by 2025 a whopping 67% of South Australia’s energy requirements will be met by renewables. Since solar and wind power isn’t as reliable as traditional methods, ‘dispatchable power’ will be required to cover base loads – and according to Pokharel, “Current gas supply and transportation terms cannot meet this type of demand profile”.

Funnily enough, expensive diesel generators may become a viable option since they (and their fuel) are simple to store and can be set up quickly. In order to use gas as dispatchable power, changes must be made to the operation of the market – involving offering subsidies for “must-run” gas units or standing capacity.

It’s great to see South Australia leading the way with their charge towards a renewable heavy energy economy and we’re excited to see where this leads in the future.

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