Guest essay by Eric Worrall
Elon Musk has announced the release of a new storage battery for home use. The new battery in principle dramatically reduces the cost of going “off grid” – powering your house entirely from solar or wind, and using the battery to provide backup power, to ensure continuous supply.
According to The Guardian;
The electric car company Tesla has announced its entry into the energy market, unveiling a suite of low-cost solar batteries for homes, businesses and utilities, “the missing piece”, it said, in the transition to a sustainable energy world.
The batteries, which will retail at $3,500 in the US, were launched on Thursday at a Tesla facility in California by the company’s ambitious founder, Elon Musk, who heralded the technology as “a fundamental transformation [in] how energy is delivered across the earth”.
Wall-mounted, with a sleek design, the lithium-ion batteries are designed to capture and store up to 10kWh of energy from wind or solar panel. The reserves can be drawn on when sunlight is low, during grid outages, or at peak demand times, when electricity costs are highest.
The smallest “Powerwall” is 1.3m by 68cm, small enough to be hung inside a garage on or an outside wall. Up to eight batteries can be “stacked” in a home, Musk said, to applause from investors and journalists at the much-anticipated event.
I’m excited by this announcement, not because I’m currently considering buying a Tesla battery, but because of the potential this announcement has, for exerting downward pressure on household electricity bills.
Assuming the battery has around 1000 charge / discharge cycles, paying $3500 every 3 years is approaching price parity with some of the more ridiculous electricity utility charges. When you factor in the satisfaction of tearing up your last electricity bill, there is a real chance a significant number of people will be tempted to make the leap.
How will utility companies respond? I suspect they will be forced to cap household bills, to put as much price distance as possible, between the Tesla option, and staying connected to their grid. It will no longer be possible to make electricity rates skyrocket, to treat household electricity consumers as an inelastic revenue source – because now householders have an alternative, to putting up with endless price rises.
The biggest losers from this potential game changer, in my opinion, might be large scale renewable energy providers. Since households now have an alternative to paying ever larger electricity bills, electricity utilities will be forced to keep costs down – they will no longer be able to ignore costs imposed by government mandated renewable schemes. Either the government will be forced to provide higher subsidies, or large scale renewable schemes will have to be scaled back, to keep grid electricity price competitive.
Aww but seriously, 16 GC-2s give me 840 Amp-Hrs @ur momisugly 24 volts. for 1200$. But it’s only money. Save the world!!!
As he is not selling toy cars, except in California, he is dumping batteries. To max his profits he had to buy millions but the stock is mounting up.
Tesla stock should become a great short at some point.
Now would be prudent. Even the people from the “land of fruit and nuts” must wake up sometime, but then again….
At 5+ days to cover, maybe he’s trying for a “short squeeze”.
So can most people afford to buy, or is it even practical, to have enough solar on your roof to run a washing machine, dryer, refrigerator, air conditioner and your daughters blow dryer?
I can see battery power for a few lights, a TV and computer for an evening.
Ted M says:
I’m open to any other “polite” and useful suggestions.
Get a gasoline powered generator. About $1 per 10 Watts is typical. A 4 kW generator for $400, etc.
Store a few 5-gal. gasoline containers with preservative. If you need power, that $400 generator will supply enough for your refrigerator, computer, and a few other appliances.
If you need more power, get a 7000 – 8000 Watt generator for ≈$700 – $800.
Tesla’s idea might be practical in another 10 years. But let the rich folks pay to bring the costs down. In the mean time, you can have backup power for about one-quarter of Tesla’s. And the technology is off the shelf and proven.
“Let the rich folks pay to bring the costs down?” Economy of mass production only works on the overhead component of item cost. Overhead costs for material-intensive items (like batteries) are minuscule. The commodity material cost of 1000 batteries is 1000 times as much as for one battery. The costs ain’t coming down.
Total power failures (right now) are rare events and of short duration. You might price inverters that will produce enough AC power from your car’s alternator to keep a computer running during a temporary outage. (Not a fridge, sorry.)
This is, at best, just a scheme to sell extra Tesla spare parts.
“You might price inverters that will produce enough AC power from your car’s alternator to keep a computer running during a temporary outage. ”
Consumption of a notebook computer can be brought down to about 50W, at least if you throttle the CPU via power management accordingly. A matching inverter to supply the notebook power supply is readily available for about 50 EUR /Dollars; plugs into the cigarette lighter. I have one in my car for eventual emergencies.
Good idea, Dirk!
I’ve run the numbers and the numbers don’t work. Even if the power to charge the Tesla battery were free, using a realistic service-life expectancy for the battery you’d wind paying more in capital cost per average useable kWh than the typical utility home rate of 12-cents. And that’s without taking the time-value of money into consideration. But then, of course, the power to charge that battery isn’t free and the presumption is that you’d replace purchased utility power for that purpose with power generated by solar cells or wind. Run those numbers on an unsubsidized basis along with the cost of the battery and the result is ludicrous!
If unsubsidized wind and solar economics don’t make sense with cheap fossil sources taking up the “reliability slack” (and which cost is not even counted in the typically promoted “green power equation”), how does anyone imagine batteries costing many times that of fossil sources of power (fuel costs included) can possibly make economic sense as the “slack taker”?
What about people who pay 40c?
I fail to see how the battery solves anything. It’s quite expensive and, as Willis noted, there are cheaper batteries already available. You need to purchase an inverter and it requires certified installation. Last I looked, too, average electrical consumption was around 18 kWh so you’d need two devices. Then, of course, there’s the solar arrays on the roof. They cost, what?, $30K to $40K. When you’re paying $.10 kWh from a utility, how does any of this make sense? The only way it does for the homeowner is if there are substantial government subsidies. those subsidies are being paid for by taxpayers and, in effect, you have a transfer of wealth from poor to rich. I know a lot of people see this battery as a wonderful technological advancement, but to be honest it really looks like a gimmicky toy for the rich and deluded — no different than the Tesla car.
It doesn’t solve anything. I suspect who advocate solar power using home systems are unable to do the math. Or they are simply solar groupies. Tesla products are toys for the upper class.
They don’t call them ‘tooling costs’ for nothing.
Some people have decades of experience living with off-grid lead-acid battery power. Industrial battery backup technology has been around a long time, eg Phone systems. Look at the projected life-cycle costs for the Li-Ion vs Lead-acid. I would not trust a Tesla battery with my life.
http://www.homepower.com/articles/solar-electricity/equipment-products/lithium-ion-batteries-grid-systems/page/0/2?v=print
Good point again. Li-ion is an expensive technology. Its good side is the small weight and size per kWs (the little brother of kWh) in cars and mobiles. Installed at home, the weight has little meaning, price/kWh * cycles is the thing.
Claude Harvey,
Correctomundo. Batteries aren’t cost effective.
Gasoline or other fossil fuels like propane and NatGas are the best. They provide lots of power, cheap.
Don’t believe me? Then put your car in neutral, turn off the engine, get out, and push it about twenty miles down the road. Then tell us what a gallon of gasoline (petrol) is worth.
Tesla’s batteries are good advertising. But they can’t compete on either price or peformance with a simple gasoline generator.
+10
Excellent comment.
how is this better than a bank of car batteries at a fraction of the cost?
You’re helping to cut down on sunspots.
The entire third world is trying to figure out how to get their populations onto the grid.
We’re being persuaded to get off the grid and triple our costs to do it.
There’s a reason why grifters don’t target the dirt poor. It doesn’t matter how stupid you are, if you are dirt poor, you have nothing to be conned out of.
how is this better than a bank of car batteries at a fraction of the cost?
It is better. For Tesla. Musk will have star struck politicians lining up to offer incentives and tax breaks to locate his high profile manufacturing plant in their state. If he plays it well, he might get the thing built for free.
back in the old days you could run a u- boat for 18-20 hrs on batteries , then one day somebody discovered they could use nuclear power.
As other posters note, more expensive that current solutions. I own an off-grid house in Arizona. I and my neighbors use golf-cart batteries. (Better than car batteries, designed for deep cycle.) The Tesla battery is about 4x as expensive per kWh. Not clear it will last any longer. Li is good for low-weight, but that it immaterial for a dwelling …
One advantage of the Tesla lithium batteries is efficiency. Those lead forklift batteries are only 60% efficient if you charge them fully (and if you don’t, the service life goes way down). 92% efficiency is quite impressive, the power saved adds up quickly.
If I were building an off-grid residence, I would seriously consider using these batteries. They would be in a separate ‘battery shack’, but that would be true for lead or NiCd as well. As far as an on-grid home, well… no thanks.
I just did a search to confirm those efficiency figures and have only so far found this:
“Typical efficiency in a lead-acid battery is 85-95%, in alkaline and NiCad battery it is about 65%. True deep cycle AGM’s (such as Concorde) can approach 98% under optimum conditions, but those conditions are seldom found so you should figure as a general rule about a 10% to 20% total power loss when sizing batteries and battery banks.”
From here: http://www.solar-electric.com/deep-cycle-battery-faq.html
So, who is right and who is wrong?
Efficiency of the cycle may be very important for grid storage, but is less important for today’s off-grid rural dwelling. Why? Because solar cells are so cheap these days. A “standard” off-grid installation wants about four days worth of storage. Today, those batteries cost more than the solar cells do. So if I can halve the cost of my batteries by cutting the efficiency 25%, that is a win: I add 25% more PV cells and I’m $ ahead.
Musk is a master at building businesses around government subsidies, as opposed to making side money from them. This one may work as well.
http://www.greentechmedia.com/articles/read/how-teslas-energy-storage-play-could-take-flight-or-founder
There’s a guaranteed market for the successful player(s).
That’s one expensive battery!
I don’t quite get it. I can do 30kw/hrs with a lead acid marine battery for the same price, that will last 5 hears and several thousand cycles.
“… I can do 30kw/hrs with a lead acid marine battery for the same price”
Musk knows that, but PbA isn’t new and cool.
Or shiny!
But before you buy (expecting that it will lower your electricity bill) you should read this:
http://www.forbes.com/sites/christopherhelman/2015/05/01/why-teslas-powerwall-is-just-another-toy-for-rich-green-people/
“If something sounds too good to be true, it probably isn’t.”
To go totally off grid from a fully on-grid position by choice requires a huge investment, 6 to 8 of these batteries, 8KW solar PV array. Do they come with an inverter man enough to cope, unlikely so one of those as well, Without any taxpayer input who can afford that kind of investment other than Elon Musk, Al Gore and others making a mint from renewables.
How long are people in the “third world” going to be happy with a communal TV and a few LED lights. Once they start wanting their own TV, more and brighter lights a fridge of their own an oven than will work in the evening one battery each will be required. Again that is a lot of expense for a community currently on a subsistence model.
I have a friend who will spend 4€ driving many more miles than to the nearest petrol (gas) station to save 3c a litre, as his fuel tank when dry holds 55 litres so I tell him it isn’t saving any money and he then looks at me as if I’m slightly deranged. He’ll be an ideal customer.
When I did my research back in 2000-ish, the most efficient system was to match your generating system with your appliances. So a 6, 12 or 24 V/DC generating system would need to be matched with 6, 12 or 24 V/DC appliances. No inverter. Inverters are better these days, but still can cause issues with some appliances. It proved to be way too expensive to build a properly sorted off-grid system.
Where most people live, we already have an efficient electricity generating and distribution system.
“When I did my research back in 2000-ish, the most efficient system was to match your generating system with your appliances.”
That’s sadly complete nonsense peddled by people who want to sell an off-grid customers a whole range of quirky low voltage dc equipment.
220Vac is more efficient than 12Vdc for a very simple reason. For any specific power rating, the 12Vdc must supply 18x the current since P=I*V. Losses are a factor of current. To calculate the loss in an section of resistive material you just need P = I^2 / R. So the losses are proportional to the square of the current!! Where P(power) I(current) R(resistance) V(voltage).
So the power losses are vastly increased (per watt of usable power) at low voltage.
Add to that concern the increased fire risk from the burden on cabling and connectors.
This is the reason why power is transmitted on the grid at a minimum of 11,000V.
Because, higher voltage is more efficient.
I run all the normal appliances in a household directly off of a sine wave UPS/inverter. Every kind of tool and household appliance.
It’s a simple system – once your inverter is set up, you just buy regular electrical goods and plug them in. (And my inverter cost me only $1.50 – see above!!).
Correction – where I wrote P =1^2 /R – I meant, of course, P = I^2 *R
Silly me!!!
Nope. I was not being sold a thing. I agree, inverters are much better these days, but still have issues. I would still go with a system that did not need inverters.
I have no idea where you live, but where I am from the UK national grid transmits at between 130 – 200kv/ac. And the efficieny comes from three phase transmision. But you’re talking here a national transmission grid, NOT off-grid, local generation and consumption. You don’t need high AC voltages for that.
My green friends are all celebrating about this one. It’s the end of nuclear power! Finally we can store renewable energy! Etc. etc…
I don’t live in a sunny country. We got 5 hours of sunshine in December and January altogether last winter. Yeah, that’s a total of 5 hours in 2 months, not daily! Even though we have constant daylight during the summer, I don’t really get the point of everyone having their own solar array and their own personal storage system. That’s because I prefer to look at the grid as one big solution:
Before the renewables, the grid was simple. We use electricity and the power companies produce it according to the needs. There only needs to be enough of producers to make sure that the lights are on when it’s -30C. This all is a challenge but professionals are really good at running the show.
Then came the wind mills. They mess up the production of energy as wind has the RIGHT to sell every single MWh they produce but not the RESPONSIBILITY to produce energy when it’s needed. They are like spoiled rich kids: Demanding a work and huge salary but coming and going as they please. All the other producers makes sure that the lights are on and they are paid less for their important work.
Then came the household solar messing up the demand. The power producers get paid less as people produce their own electricity but still they need to make sure there’s enough for the rainy day and the night.
Then came the brilliant idea that everyone should be entitled to sell their own electricity to the grid. Suddenly everything is not so simple any more. Now the grid can’t even plan any more. They need to balance a system where people are not only using electricity at random but also producing it at random.
So what we’ve got is a great mess: Those who cause trouble to the grid and make it more expensive for everyone are being paid huge subsidies. They cause horrible problems to reliable energy producers and to the grid. As a result we’ll eventually get to the point where we simply won’t have the capacity needed for the rainy day/week. Or if we do, even that will get horribly expensive and require subsidies.
So we’ll have huge subsidies, expensive electricity, complex grid and that’s going to be called progress.
+3
Couldn’t have said it better +10
+1
(frugal always)
Very well stated. I writing up a report on this [and] I will be [plagiarizing] you [a] bit if you do not mind.
Sorry for the typos, phones keyboard and text a bit small for me. No edit, to bad
Sure, feel free to copy.
“My green friends are all celebrating about this one.”
The self-flattering bien-pensant crowd will ensure this will be “successful” through the powers of marketing, PR and free media promotion (and of course, taxpayer subsidies) without a single mention of any downsides. Sort of like most other green-led campaigns.
I don’t see the point. The whole reason for installing solar panels is to extract subsidies from the government (well, from your neighbor via the government).
Well, the whole point of Tesla’s announcement is to get people to push their representatives to enact subsidies for Tesla’s batteries.
Simples, you package the battery as part of the “renewable installation” and collect a larger subsidy.
What about battery degradation? For every charge/dicharge cycle, the battery loses capacity. For a Panasonic NCR18650A, rated at 2.9Ah when new, this goes down to2.1 Ah after 500 cycles. This is 27% capacity loss, and on a daily basis, 0.05% per day of use. Assuming that most of the cost of the system are the batteries, this boils down to a loss of value of the system of 810$. This should at least be compensated for by savings in th value of the electric energy stored during this period. Do the math.
Yes, correct. Li-ion normally are only good for 500 full charge/discharge cycles.
One important question: according to a professor electro-mechanics here on the news, the Tesla pack is batteries only, without the necessary DC-AC converter. If you like to have a nice sine wave at high power, you can double the price…
Seems to me more hype than solution…
I think a diesel generator is cheaper especially if you use the waste heat for water heating
I thought this was going to be a major step forwards in electricity storage when I saw the pre-release hype, so I was quite interested to see the announcement. However, when I got the bottom and saw 10kWh , I thought I’d misread it. My eye’s were tired, I’d lost a zero or two ??
The energy density is surely better than lead-acid but this seems like a small step forwards rather than a major innovation.
A cheaper alternative is used lead acid cells from forklifts. They are not ideal technically but are usually taken out of service when the can’t deliver the peak power needed to lift a heavy load. For moderate continuous power required for an inverter, they have many years of service left.
you can pick them up for scrap metal costs, and when you are done, you can still sell them as scrap and recover the cost.
Obviously you need to choose cells in a serviceable condition, some may really be beyond use.
I have a mate who runs a forklift business and he’s happy for me to take them away if I give him the scrap value. Saves him the trouble.
In Denmark (and I kid you not) the government will tax the saving you make by not buying electricity from the grid (The logic – a saving is the same as an earning – which is taxable)
I thought the USA was bad….
That’s just nuts. I wish you WERE kidding.