Tesla Powerwall: Engineering Analysis

[rollingstein]

Just thought I'd post this on here to see what comments people have:

http://www.teslamotors.com/powerwall

Tesla has announced a Li-ion battery "Powerwall" priced at $3500 for 10 kWhr storage. What payback to people perceive? Gimmick, niche market or disruptive technology?

 

[russ_watters]

So, I'm not sure if you are aware of the purpose, but the idea is to store energy at night when it is plentiful and cheap and use it during the day when it scarce and expensive. The idea is already used on a utility scale to reduce the number of power plants needed and on a commercial scale to reduce costs (and to help the utilities).

The problem for now is that there is no residential market that I'm aware of for this concept. In order to make it useful, your electric rate would have to vary from day to night (as it already does commercially). So this is a product without a market (except for the secondary purpose of being a whole house backup).

 

[anorlunda]

It should be very welcome to people who really live off the grid. But that is probably not a large market.

 

[rollingstein]

So, I'm not sure if you are aware of the purpose, but the idea is to store energy at night when it is plentiful and cheap and use it during the day when it scarce and expensive.

I think I'm aware of the purpose just unsure evaluating the commercial payback.

It should be very welcome to people who really live off the grid. But that is probably not a large market.

The competition there should be from diesel / propane generators or conventional lead acid.

The problem for now is that there is no residential market that I'm aware of for this concept. In order to make it useful, your electric rate would have to vary from day to night (as it already does commercially).

http://www.pge.com/en/mybusiness/rates/tvp/toupricing.page?WT.mc_id=Vanity_tou

I think many areas already have time of use pricing for residential customers.

 

[MarkJW]

Not sure 7 kW is enough to run air conditioning and the rest of the house, and AC needs do not stop the moment the sun sets. Still an interesting offer.

 

[russ_watters]

http://www.pge.com/en/mybusiness/rates/tvp/toupricing.page?WT.mc_id=Vanity_tou

I think many areas already have time of use pricing for residential customers.

I won't rule it out because I don't know every electric company's rate structure, but that isn't an example: that's for commercial customers.

 

[russ_watters]

Not sure 7 kW is enough to run air conditioning and the rest of the house, and AC needs do not stop the moment the sun sets.

7 kWh: 2 kW. To be fully off-grid in a decent sized house with air conditioning and electric appliances, you'd need about 5 of them. If your cooking and hot water are natrual gas, you might get away with 3.

 

[Bandersnatch]

So, I'm not sure if you are aware of the purpose, but the idea is to store energy at night when it is plentiful and cheap and use it during the day when it scarce and expensive.

Can't it be used for the opposite? Store energy during the day from solar cells, and use it during the night? I thought that was the main selling point, but admittedly I'm not following it very closely.

 

[anorlunda]

7 kWh: 2 kW. To be fully off-grid in a decent sized house with air conditioning and electric appliances, you'd need about 5 of them. If your cooking and hot water are natrual gas, you might get away with 3.

The US Energy Information Administration says that the average US household consumption is 10.9 kWh/day.
If so, then 7 kWh for the hours when the solar panels are not producing seems about right.

I think the difference might be the definition of "decent sized house" which may vary an order of magnitude in many places. Also, climate makes a difference; many areas live with little or no air conditioning and those contribute to the national average.

I do think that the Musk's intention is that only one such battery bank would be needed for the household.

 

[rollingstein]

I won't rule it out because I don't know every electric company's rate structure, but that isn't an example: that's for commercial customers.

You are right. Wrong link. Here's another page on the PGE site:

http://www.pge.com/en/about/rates/rateinfo/rateoptions/index.page

"There are two basic rate options for single-family, separately meteredresidential customers. E-6 is an optional time-of-use rate schedule for individually metered customers who can minimize their loads during defined time periods."Also here are other utilities that seem to offer time of use plans:

SCE Introduces a New Residential Time-Of-Use Rate Plan

https://www.sce.com/wps/portal/home...t0mKkYfEEvibj1Q!/dl4/d5/L2dBISEvZ0FBIS9nQSEh/

http://www.srpnet.com/prices/home/tou.aspx#save (Looks like Residential Tarriff but not 100% sure)

https://www.portlandgeneral.com/residential/your_account/billing_payment/time_of_use/pricing.aspx

https://www.nvenergy.com/home/paymentbilling/timeofuse.cfm

 

[russ_watters]

Can't it be used for the opposite? Store energy during the day from solar cells, and use it during the night? I thought that was the main selling point, but admittedly I'm not following it very closely.

Hmm...the website lists both uses together, and now that I google, a lot of articles focus on combining it with a solar installation. But as it happened, this is the article I first saw, which emphasizes the time-of-use pricing:

Kimbal Musk, a Tesla (TSLA) board member, said the new battery would slash consumers' electric bills by 25% just by being smarter about energy use.

"It's quite a profound thing," Kimbal Musk told CNNMoney's Cristina Alesci on the sidelines of the Milken Global Conference in Los Angeles.

Instead of paying premium rates for electricity at 3 p.m., the battery will charge itself at 3 a.m., he said. That's a big deal because peak rates in the afternoon in California are around 35 cents a kilowatt hour, compared with just 8 cents in the hours before dawn.

"So you'll be paying one-quarter of the price for electricity," Kimbal Musk said.

http://money.cnn.com/2015/04/29/investing/tesla-musk-battery/?iid=EL

Bad math aside (does it save 25% or 75%?), it glosses over the availability issue for time of use rates.

 

[russ_watters]

You are right. Wrong link. Here's another page on the PGE site:

http://www.pge.com/en/about/rates/rateinfo/rateoptions/index.page

"There are two basic rate options for single-family, separately meteredresidential customers. E-6 is an optional time-of-use rate schedule for individually metered customers who can minimize their loads during defined time periods."

I stand corrected -- I hadn't heard of it being offered residentially before.

 

[rollingstein]

Can't it be used for the opposite? Store energy during the day from solar cells, and use it during the night? I thought that was the main selling point, but admittedly I'm not following it very closely

That's what I had thought too.

If this is a cost effective plan to store utility generated power why isn't the utility itself doing it in a scalable manner & earning economies of scale? I thought that other than pumped storage none of the other storage techs were cost effective yet.

If it ain't cost effective at scale how is it turning out to be cost effective at consumer level to store grid power?

I do think that the Musk's intention is that only one such battery bank would be needed for the household.

Right. I think the design allows eight to ten units to be chained together & to work as a monolithic electrical unit.

My concern though, whether buying a single unit or ten, is what sort of customer this is going to pay off for. Note that neither solar panel nor inverter nor installation is included in the $3500

 

[russ_watters]

If this is a cost effective plan to store utility generated power why isn't the utility itself doing it in a scalable manner & earning economies of scale?

Because for the most part, the utilities are selling energy, not buying it. Applying this idea at the utility wouldn't change anything for the utility because for the most part the electricity made at night costs the same amount to make but just isn't worth as much to the consumer. The primary benefit of something like this for utilities is saving in the capital cost of building new power plants that just run 100 hours a year (a few hours a day in the middle of summer) or if they have a high nuclear fraction and have trouble throttling at night. But barring that, the energy cost savings all goes to the consumer.

I thought that other than pumped storage none of the other storage techs were cost effective yet.

For customers, what makes storage cost effective is a wide variation in rates between day and night. That hasn't been common until recently. There are other energy storage technologies, such as ice and cold water storage, that are starting to make a comeback now that there are more such rates. It also used to be that you could get a special electric heating rate that was very cheap, because again most heating happens at night when the electricity is plentiful and the utilities have to dump it (occasionally, the spot rate will go negative: the utility will pay you to take the electricity).

 

[rollingstein]

. Applying this idea at the utility wouldn't change anything for the utility because for the most part the electricity made at night costs the same amount to make but just isn't worth as much to the consumer.

Hmm...Not sure that I understand. e.g. Say you are an utility then during the daytime peak you are bringing on load several peaking power plants. Their cost of production is much higher than base load generation. Plus the Capex & maintenance needed for peaking power plants. Isn't that the fundamental reason for the variation between day / night rates?

This is the niche that pumped storage satisfies for the utilities I thought.

If indeed battery storage were cost effective, why might I not, as a utility, invest in massive battery storage farms & thus use my cheaper cost of generation base load plants?

My point is, if the cost of batteries does not make sense yet on scale why is it making sense in retail?

 

[anorlunda]

Right. I think the design allows eight to ten units to be chained together & to work as a monolithic electrical unit.

My concern though, whether buying a single unit or ten, is what sort of customer this is going to pay off for. Note that neither solar panel nor inverter nor installation is included in the $3500

It appeals to customers who already spend $25,000 or more (pre-subsidy) for solar panel/inverter installations. When you are investing in such an installation, the incremental cost to add capacity beyond your daytime demand is small. In some places (not all) you can use net metering to sell energy back to the utility, but those net metering deals are full of problems, and are probably not sustainable. It can be more appealing to increase investment 20% for batteries, and to store excess energy during the day for you to consume later. For those dreaming of going entirely off grid, it makes it one step easier to have a battery option

.

My point is, if the cost of batteries does not make sense yet on scale why is it making sense in retail?

rollingstein is correct regarding this conversation.

I have no idea how the idea of utility customers shifting load time-of-day got into this discussion. There are simpler, nearly free, easier ways to do that. Setting your dishwasher and laundry to run at night on timers, and to program your climate controls to do more off-peak. Since very few consumers do even that, it is silly to imagine them investing thousands of dollars as their first step in off-peak shifting. To show the whole world that you are "green" hanging your laundry on a clothesline is much more visible than a battery in a closet.

Bur rollingstein missed this: General Electric, has a big factory since 2012 to make batteries for utility and industrial applications. They don't mess around with consumer markets. But there are hundreds of reasons why utilities and industries may want such batteries, time-of-day shifting is only one of them. I think one of their larger customers have been wind farms in western states, where the wind blows mostly at night. In the eastern parts of USA, wind tends to blow more in the daytime.

I also want to point out that in many parts of the country, ownership of electric generating plants has been divorced from utilities that sell power retail to consumers. I used to work at one of the ISOs that operate the grid and the energy markets. Generators sell their power to the ISO, and utilities buy their power from the ISO, on a minute-by-minute open auction system. The wolesale price of electricty thus varies minute-by-minute and by location on the grid. Retail customers do not participate in the volatile wholesale market, they get fixed rates set by the state public service commissions. Wholesale powerplant owners (renewable or other) no longer have a stake in the economics of the utility, each of them has to eke out its own profit or die.

In addition to raw energy, the ISO buys capacity to do regulation of frequency and voltage, to provide standby reserve power capacity, and even to provide capacity to black-start in case of a blackout. During extreme peak times, the ISO even buys voluntary curtailment of load demand as an alternative to increasing generation. All of these secondary markets have value, in aggregate several billion dollars worth per year nationwide. Battery technology can be profitable in various secondary niches.

I do not believe that the 7 kWh Musk battery is targeted to play any role in these wholesale electric markets or to compete with GE's utility/industrial batteries. Please let's not muddle this conversation by mixing utility/industrial/residental things that operate mostly independent of each other. The 7 kWh Musk battery is targeted at residences.

 

[rollingstein]

Bur rollingstein missed this: General Electric, has a big factory since 2012 to make batteries for utility and industrial applications. They don't mess around with consumer markets. But there are hundreds of reasons why utilities and industries may want such batteries, time-of-day shifting is only one of them.

@anorlunda

I totally agree that batteries have hugely useful industrial functions. They are ubiquitous. This big GE battery factory is no surprise. What would surprise me though is if a large fraction of that factory's production went to utility peak shaving applications. Does it?

What I wasn't aware of were any non-test-of-concept, large scale deployments of batteries as a utility peaking device. Based on what you wrote, wind farms are already doing that? If so, that's very interesting. I'll read up more on that. Do you know if the wind farms are using Lithium or Lead Acid?

 

[anorlunda]

@anorlundaWhat I wasn't aware of were any non-test-of-concept, large scale deployments of batteries as a utility peaking device. Based on what you wrote, wind farms are already doing that? If so, that's very interesting. I'll read up more on that. Do you know if the wind farms are using Lithium or Lead Acid?

the side

The technology keeps shifting. GE started with lithium, then went to sodium, now they're talking about fuel cells. The point is that these devices are the size of a small RV, cost up to millions of dollars, and are not relevant to the Musk battery discusssion.

By the way, I read somewhere that 10,000 - 20,000 households in Japan are already using fuel cells. For some reason, they are not marketed in America. But be it solar, or batteries, or fuel cells, the future sounds exciting.

 

[rollingstein]

The point is that these devices are the size of a small RV, cost up to millions of dollars, and are not relevant to the Musk battery discusssion.

I think they are relevant in this sense: If at least on scale a particular "device" or technology makes economic sense then I'm willing to consider that it might also perhaps make sense in small scale. But if the technology won't be cost effective at scale then it is hard to think why it can be specifically effective at household level.

So although the devices are far different one sort of sets one extreme of viable operation for the other.

 

[cpscdave]

I'm interested to see how the energy utilities are going to react to this.
Assuming a wide scale adoption of the batteries, it would help the utilities by smoothing out the power demand over a 24hour period. Which will them to rely on their more efficient, cleaner and cheaper plants. I could also see not having to scale up and scale down generation as much will help reduce wear on their equipment.

On the other hand a half decent solar panel & this would drastically reduce the consumers reliance on the grid.

 

[rollingstein]

On the other hand a half decent solar panel & this would drastically reduce the consumers reliance on the grid.

Is reducing reliance on the grid axiomatically good? Most grid connected consumers in the US enjoy amazingly high uptime.

I'm pretty sure you'd have to spend a lot more to get that sort of reliability when you go off grid.

 

[insightful]

Regarding payback, if the 7kWh unit costs $5000 installed and saves 7kWh/day peak-cost power, for a 10 year payback you'd need a differential of 5000/7/365/10 = $0.20/kWh. This is just to break even (no savings). Color me unimpressed.

 

[rollingstein]

Regarding payback, if the 7kWh unit costs $5000 installed and saves 7kWh/day peak-cost power, for a 10 year payback you'd need a differential of 5000/7/365/10 = $0.20/kWh. This is just to break even (no savings). Color me unimpressed.

Besides, doesn't that assume approx. 3500 charge / discharge cycles. Are these batteries capable of that life?

 

[insightful]

Tesla warrants them for 10 years.

 

[russ_watters]

Hmm...Not sure that I understand. e.g. Say you are an utility then during the daytime peak you are bringing on load several peaking power plants. Their cost of production is much higher than base load generation.

1. The cost to produce a kWh will be the average over the entire set of operating power plants. So a coal plant operating 100% all the time uses the same amount of coal and cost the same amount to make a kWh regardless of time of day.
2. I don't think peaking power is much more expensive than from other sources, but obviously it will depend on the particular sources: it certainly isn't four times more expensive (after averaging it in with baseload) per Tesla's number. And as I said before, the price of electricity at night sometimes actually goes negative!

Plus the Capex & maintenance needed for peaking power plants.

Right: building and maintenance is the big cost for peaking plants. Not energy production.

Isn't that the fundamental reason for the variation between day / night rates?

The price of any product is driven by a balance between supply and demand. Energy supply availability is fixed (not counting solar), meaning you can run a peaking plant at the same cost any time of day. Demand is what varies and forces shutting off power plants or dumping electricity at night or turning-on a peaking plant during the day. So you are charged during the day for the existence of the peaking plant and energy is dumped onto the market at night because base load plants don't throttle well.

If indeed battery storage were cost effective, why might I not, as a utility, invest in massive battery storage farms & thus use my cheaper cost of generation base load plants?

Because the difference in the value of the energy to the consumer is greater than the difference in cost for the utility to produce it.

 

[russ_watters]

I have no idea how the idea of utility customers shifting load time-of-day got into this discussion.

Elon Musk brought it up.

There are simpler, nearly free, easier ways to do that. Setting your dishwasher and laundry to run at night on timers...

These are very small fractions of your overall energy use, so it doesn't come close to solving the problem.

...and to program your climate controls to do more off-peak.

You can't. The sun shines during the day and therefore it is hot during the day. The only way to shift air conditioning from daytime to night time is to make the the "cold" at night and store it for when you need it during the day. This is done commercially with ice storage, but as far as I know does not exist residentially:
http://en.wikipedia.org/wiki/Ice_storage_air_conditioning

Since very few consumers do even that, it is silly to imagine them investing thousands of dollars as their first step in off-peak shifting. To show the whole world that you are "green" hanging your laundry on a clothesline is much more visible than a battery in a closet.

What makes you think that people even do the investment calculations when making such decision? I would love to poll hybrid car owners on this. When did Elon leave Google? How seriously did he consider the economics of his Bloom Boxes when he bought them? (assuming he was still there - I think he was) [/cynic]

 

[rollingstein]

Assuming a wide scale adoption of the batteries, it would help the utilities by smoothing out the power demand over a 24hour period. Which will them to rely on their more efficient, cleaner and cheaper plants

Efficient / cheap versus "clean" don't seem necessarily correlated. e.g. If power peaks disappeared overnight then utilities will probably use their coal fired base load plants.

Those are both cheap & efficient but are not perceived as "clean" by the public.

2. I don't think peaking power is much more expensive than from other sources, but obviously it will depend on the particular sources: it certainly isn't four times more expensive (after averaging it in with baseload) per Tesla's number. And as I said before, the price of electricity at night sometimes actually goes negative!

I found some old US-EIA numbers for Total Operating Expenses circa. 2008 that I had collected for some back of the envelope calculations:

Base Load Hydro = 9 mills / kWhr
Base Load Nuclear = 20 mills / kWhr
Peaking Gas Turbine = 70 mills / kWhr

(1 mill = 0.001 $)

So it's not unheard of for a peaking plant to be 4x expensive as baseload to operate.

I assume Gas is much cheaper at present but its questionable whether the low prices will sustain in the long run.

 

[russ_watters]

I found some old US-EIA numbers for Total Operating Expenses circa. 2008 that I had collected for some back of the envelope calculations:

Base Load Hydro = 9 mills / kWhr
Base Load Nuclear = 20 mills / kWhr
Peaking Gas Turbine = 70 mills / kWhr

(1 mill = 0.001 $)

So it's not unheard of for a peaking plant to be 4x expensive as baseload to operate.

I assume Gas is much cheaper at present but its questionable whether the low prices will sustain in the long run.

Could you post a source please. In particular, I'd like to know:
1. What fraction of the power is "peaking power"? For example, if your base load is nuclear and your peaking plants have equal capacity, then the weighted average cost of power sold at peak times is only 45 mils: a factor of 2.3:1, not 4:1.

2. Does that include the cost of the plant? I expect it does. If that's the case, then all of the potential savings comes from not building/maintaining the plant, not from shifting the time of production. Or from the other angle: if you use a peaking plant for base load, the cost of the energy goes down.

Now, that last one implies a case that might favor your argument: let's say the utility is considering installing a new peaking plant that runs at .25 kW for 4 hours, 100 days a year. Or they can buy a 1 kWh battery from Tesla and use their already existing peaking plants to charge it at night. The fuel cost is identical in either case, so the only real question is whether a 1 kWh battery is cheaper or more expensive to buy than a .25 kW plant.

 

[rollingstein]

Could you post a source please. In particular, I'd like to know:

My notes say the source is US-EIA. But I don't have an online link. I'll look it up. It might have been a printed EIA report. 2008 was back in the dark ages after all. :)

What fraction of the power is "peaking power"?

In 2014 70% of US electricity generation was Coal + Nuclear + Hydro + Renewables.

So my guess is that 30% of generation is via peaking power plants. Mostly natural gas turbines.

Does that include the cost of the plant? I expect it does.

No I don't think my US-EIA data has cost of plant. Those figures are purely Opex. Operations + Fuel + Maintainance

Now, that last one implies a case that might favor your argument: let's say the utility is considering installing a new peaking plant that runs at .25 kW for 4 hours, 100 days a year. Or they can buy a 1 kWh battery from Tesla and use their already existing peaking plants to charge it at night. The fuel cost is identical in either case, so the only real question is whether a 1 kWh battery is cheaper or more expensive to buy than a .25 kW plant.

Yes. That is precisely my point. If Lithium batteries were indeed cost effective as load levelers (i.e. peak shaving) the first place I'd expect to see 'em was as alternatives to new peaking power plants. Or to mothball some peaking capacity. A la pumped storage.

Are there any?

 

[anorlunda]

Could you post a source please. In particular, I'd like to know:
1. What fraction of the power is "peaking power"? For example, if your base load is nuclear and your peaking plants have equal capacity, then the weighted average cost of power sold at peak times is only 45 mils: a factor of 2.3:1, not 4:1.

2. Does that include the cost of the plant? I expect it does. If that's the case, then all of the potential savings comes from not building/maintaining the plant, not from shifting the time of production. Or from the other angle: if you use a peaking plant for base load, the cost of the energy goes down.

Now, that last one implies a case that might favor your argument: let's say the utility is considering installing a new peaking plant that runs at .25 kW for 4 hours, 100 days a year. Or they can buy a 1 kWh battery from Tesla and use their already existing peaking plants to charge it at night. The fuel cost is identical in either case, so the only real question is whether a 1 kWh battery is cheaper or more expensive to buy than a .25 kW plant.

I'm sorry russ_watters, your logic is a bit out of date (see post #19). That's not the way the economics work.

Electric energy is traded on an auction system that matches buyers and sellers. Each auction sets a "market clearing price" that all sellers and buyers can agree on. (Like the stock market where IBM stock clearing price for today might be $100, and all buyers and sellers at market trade at that price, regardless of what it cost to buy the IBM shares in the past.) So, when energy supplies are tight, the more expensive producers are called to produce and the entire market pays the more expensive price. Yes, even the low cost power plants are paid the market clearing price.

Even a 1 MW expensive diesel generator can on rare occasions set the price for a 30,000 MW region for a few minutes. That is why the grid operators are willing to pay up to 10x market price to buy voluntary load curtailment rather than start expensive generators. In New York, one investor even tried it using a flywheel as a battery. It failed in the energy markets, but it did find a niche selling secondary services. Only pumped storage hydro has been proven economically viable to store electric energy on a bulk power scale.

I have seen the actual wholesale price vary from -$150/MWh to +$1000/MWh. There are many factors other than fuel price that influence the bid/ask prices. In most states, utiliities are forbidden to start rolling blackouts just because the price is too high. They are required to pay whatever it takes to buy all the energy needed to satisfy the demand, not matter what the price.

Sellers on these markets, just set the price at which they are willing to sell. They don't separate out their capital versus operating costs.

But returning to the Musk issue. use of batteries to buy cheap and sell high on time-of-day wholesale energy price swings is very very far from economic viability. Musk must have had his used-car-salesman hat on if he mentioned that in public.

By the way, the world's biggest utility battery installation is in Fairbanks Alaska. But its purpose had nothing to do with energy prices. Fairbanks is pretty isolated in Alaska. There is only one main power transmission line for the city. The battery was installed to allow the utility up to 20 minutes to do maintenance on the line without blacking out the city. As I said in post #19, there are hundreds of reasons (other than energy price) why batteries can be attractive to utilities.

 

[russ_watters]

Anorlunda, we are talking about two different things. Yes, I agree that the price to sell the power at generally has to be above the highest price to generate the power (unless there is an unfixable surplus) and that changes throughout the day. But the price to generate the power does not change throughout the day and that's what I was asking about above. The shortage during the peak increases the profits for all plants because the average selling price goes way up (4x per Tesla) while the price to make it doesn't go up as much. The price to make it is what I'm trying to determine.

I haven't gone through the whole analysis though, so I don't know the actual economic case: that's why I'm asking for clarification of the input data.

 

[anorlunda]

Now, that last one implies a case that might favor your argument: let's say the utility is considering installing a new peaking plant that runs at .25 kW for 4 hours, 100 days a year. Or they can buy a 1 kWh battery from Tesla and use their already existing peaking plants to charge it at night.

You're still working under the assumption that it is the utility that owns the generation facilities. In many parts of the country, that is no longer true. Each generating facility is a business unto itself. The econmic decision is whether to invest at all, or invest in asset A, or asset B. If your business strategy is to buy energy when it is cheap, and sell it when it is expensive, you must deal with the fact that you can sell power to the grid at wholesale prices, (say $0.03 kWh) but unless you are a public utility, you must buy it at retail prices (say $.15 kWh). The net metering rules that allow solar panel owners to sell back at retail, don't apply to batteries.

Anorlunda, we are talking about two different things. Yes, I agree that the price to sell the power at generally has to be above the highest price to generate the power (unless there is an unfixable surplus) and that changes throughout the day. But the price to generate the power does not change throughout the day and that's what I was asking about above. The shortage during the peak increases the profits for all plants because the average selling price goes way up (4x per Tesla) while the price to make it doesn't go up as much. The price to make it is what I'm trying to determine.

If your only asset is a battery bank, then your cost is the capital cost divided by expected lifetime, add to that the fixed cost of meeting the grid's interconnection requirements to sell wholesale (for example, a transformer to boost the voltage to 115 KV, plus the costs for computers and interfaces to allow your batteries to be controlled by the grid operator, plus the engineering studies required to certify your design as safe and reliable), your variable costs are the cost to purchase the energy to charge the battery. How that energy was generated is irrelevant to you, only the price matters. As I said above, you'll have to pay retail price to buy that energy.

Even if you own another asset, such as a wind farm, your cost to charge your batteries is the "opportunity cost" lost by not selling the energy to the grid. Let's say you own a wind farm that can generate for zero incremental cost. It can charge your batteries, or it could sell the energy to the grid at night for $10/MWh. The "cost" to charge your battery is then $10/MWh, not zero. Or maybe you own a peaking gas turbine, that generates incrementally at $40/MWh. It would be foolish to run that at night for $40 when you could buy the energy from the grid for $10. So no matter what you own or don't own, your costs to charge the battery will be the grid's marginal price at that time of day.

I understand the logic you're trying to apply Russ. I'm trying to tell you that you have an unrealisticly overly simplified view of how it really works. The coplexities completely overwhelm the simple logic.

 

[anorlunda]

Or maybe you own a peaking gas turbine, that generates incrementally at $40/MWh. It would be foolish to run that at night for $40 when you could buy the energy from the grid for $10.

Whoops, I misspoke there. The complexities overwhelm me too at times. In the secenario above, you would be forced to buy retail at $150 rather than wholesale at $10.

 

[rollingstein]

@anorlunda Is it really true that there are today parts of Southern California where the retail day versus night price differs by 20 to 25 cents? I remember reading that somewhere.

If they really have such a large differential then battery options start making sense I guess for such niche markets. Though I'm not sure if Li makes sense or just lead acid.

I just find it mind boggling why such a large peak-non-peak differential can persist. At those margins won't more peaking stations make sense?

The battery was installed to allow the utility up to 20 minutes to do maintenance on the line without blacking out the city.

Intuitively I'm surprised that a battery was cheaper for this large application instead of a diesel / gas generator.

You're still working under the assumption that it is the utility that owns the generation facilities.

I was reading up on PG&E and it seems like in addition to electric distribution they also own several nuclear, coal & hydroelectric generation plants.

So can their distribution business not use the generation business' power directly? Must the PG&E Generation sell to the grid & the PG&E distribution buy from the grid?

How do things work when a utility also owns its own generation capacity?

 

[anorlunda]

How do things work when a utility also owns its own generation capacity?

My first hand knowledge is from New York State. There, the utilities are forbidden to own generation. In California, the rules of CALISO apply. I can't speak to that.

Remember also that the electrons flow though every possible path in the entire interconnected grid, which is owned by many parties. CA belongs to the interconnection that goes all the way to Colorado. You can't use that grid without following the rules of the grid operator, even if you own the source, the destination, and the most direct path between them. That's logical because what you do affects everyone.

But in New York, there was a case where power plants draw from the grid about 1% of the power they inject to operate their "house power". I.e. internal pumps, AC and lights (and let's inject charge their batteries) When the plant is shut down, it still draws house power from the grid. The ruling was that they had to buy that "house" power from the grid at retail prices. The "net metering" rules in CA that allow homeowners to buy and sell back at the same price don't apply except for homeowner solar/wind.

 

[dschlink]

Russ - my cabin is on time-of-use payment with PGE; this is particularly valuable for me as it has a heatpump and in the winter when I'm not there, I have the thermostat programmed to raise the temperature at night when I'm paying about 1/3 of the regular rate.

I could see charging the battery at night and using it to reduce daytime costs; but for power backup, I'd need 4KW or two units.

 

[nitsuj]

The problem for now is that there is no residential market that I'm aware of for this concept. In order to make it useful, your electric rate would have to vary from day to night (as it already does commercially). So this is a product without a market (except for the secondary purpose of being a whole house backup).

Ontario, Canada has "smart meters" for time of day costing, there is a price differential though I'd be surprised if the unit could pay for itself before the battery capacity becomes nill.

Also I haven't seen the very important value for it's wattage/amperage capabilities. Powering an oven/dryer maybe out of the question for a single unit, even a microwave takes a lot of wattage.

 

[rollingstein]

Also I haven't seen the very important value for it's wattage/amperage capabilities. Powering an oven/dryer maybe out of the question for a single unit, even a microwave takes a lot of wattage.

5.8 amp nominal, 8.6 amp peak output

Remember also that the electrons flow though every possible path in the entire interconnected grid, which is owned by many parties. CA belongs to the interconnection that goes all the way to Colorado. You can't use that grid without following the rules of the grid operator, even if you own the source, the destination, and the most direct path between them. That's logical because what you do affects everyone.

Have you seen situations where someone had to make an unscheduled shutdown of a baseload power station e.g. Coal just because demand dropped to a level so low that even after shedding all the peaking plants, generation exceeded the ability of the grid to absorb power?

 

[OmCheeto]

Ontario, Canada has "smart meters" for time of day costing, there is a price differential though I'd be surprised if the unit could pay for itself before the battery capacity becomes nill.

Also I haven't seen the very important value for it's wattage/amperage capabilities. Powering an oven/dryer maybe out of the question for a single unit, even a microwave takes a lot of wattage.

According to the U.S. Energy Information Administration:

In 2013, U.S. electric utilities had 51,924,502 advanced (smart) metering infrastructure (AMI) installations. About 89% were residential customer installations.

Residential  Commercial  Industrial   Transportation             Total
46,083,727   5,597,147     242,783              845        51,924,502

ref

Though this doesn't guarantee that "Time of Use" is available to all customers, but only that it could be.

It is available through my utility company:

https://www.portlandgeneral.com/residential/your_account/billing_payment/time_of_use/pricing.aspx

Peak   $/kWh
On     $0.12581
Mid    $0.07222
Off    $0.04195

Just eyeballing it, it looks as though it would be cheaper to be a mushroom.
hmmm...

My usage:

1000 kwh/month average = $126/month on-peak & $42/month off-peak = $84/month savings
$84/mo * 12mo/yr = $1000
Cost of Tesla battery = $3500
ROI = 3.5 years.​

hmmmm...

 

[rollingstein]

My usage:
1000 kwh/month average = $126/month on-peak & $42/month off-peak = $84/month savings
$84/mo * 12mo/yr = $1000
Cost of Tesla battery = $3500
ROI = 3.5 years.

1000 kWh/mo is approx. 40 kWh / day assuming a pretty invariant usage pattern.

That sounds like you'd need four Powerwalls? $14,000?

 

[nitsuj]

1000 kWh/mo is approx. 40 kWh / day assuming a pretty invariant usage pattern.

That sounds like you'd need four Powerwalls? $14,000?

What's more Om's ROI takes 3.5yrs to reach cost...what's the battery life expectancy after 3.5 years of daily use?...will it catch fire?

 

[OmCheeto]

1000 kWh/mo is approx. 40 kWh / day assuming a pretty invariant usage pattern.

That sounds like you'd need four Powerwalls? $14,000?

Ah! You are correct. So that would be 14 years for ROI, which is longer than the batteries last, so this would not be a good investment for me.
Unless of course, I switch to another form of heating.
My summer usage is only 14 kwh/day, so I could probably get by with 1 unit.

Wait a second. No, I don't need 4 units. I only need enough units to cover "On-peak" rates.
Good grief. This is worse than figuring out taxes.

This may take me a while to figure out...

 

[CWatters]

Here in the UK... Electricity consumption per head is lower than in the USA. Many people with PV generate more than they use at certain times of the day (or even when averaged over the year). The subsidy/financial incentive they give you to install PV assumes you will export a fixed percentage of the electricity you generate even if you use it all yourself. So it's attractive to store and use all that you generate rather than export any.

It doesn't normally make sense to use electricity to heat water (gas and oil are cheaper) but some people install an extra heating element in their hot water tanks and use this to store the excess electricity from their PV system. There are devices you can get that detect you are exporting and turn on and modulate the heating element.

I think some people will also use Tesla batteries to store the excess electricity they generate in the day to charge their electric car at night.

One question I have... Tesla are offering a 10 year warranty which seems generous given that many cells are only rated for around 1000-2000 cycles?

 

[nitsuj]

5.8 amp nominal, 8.6 amp peak output

less than half of a standard outlet /cry presuming normal voltage, this thing can can't even produce just one horsepower (ideal use)

I think they maybe really sacrificing available wattage for battery life / safety. The battery for my remote control car toy (1.5kg) has an 11.1 lithium polymer that can do 1400 watts all day and stay only "warm". though would be lucky to get 500 uses and still have >80% capacity.

One question I have... Tesla are offering a 10 year warranty which seems generous given that many cells are only rated for around 1000-2000 cycles?

It would be interesting to have more info on the batteries. I don't get why this is suddenly a viable tech, which makes me think marketing rather reduced cost / improved tech. Has Tesla come up with new battery formulations, or reach new "economies of scale" with their batteries?

When will Tesla sell batteries for my remote control car toys? lol I want 10 year warranty with 3000 cycles."It's[/PLAIN] like crazy off-the-hook," Musk said during an earnings presentation on Wednesday. "The sheer volume of demand here is just staggering."

Anyone can go online and place a reservation, years in advance, with no money down and no commitment to buy."

Oh Musk, you're the king of optimizing investors with your optimism to get them investing or to stop asking about some sort return...again & again. lol That said GO MUSK!

If I had "venture dollars" hearing "It's like crazy off-the-hook," would be a bit too much of a ...warning sign..."cause like trendy isn't for things that cost thousands, so like I so couldn't"

 

[rollingstein]

It would be interesting to have more info on the batteries. I don't get why this is suddenly a viable tech, which makes me think marketing rather reduced cost / improved tech. Has Tesla come up with new battery formulations, or reach new "economies of scale" with their batteries?

If you look at their Powerwall website, other than whatever details are on that one page there's no other Literature. No spec. sheets, no test results, no whitepapers, no pdf's, no best practices, installation instructions. Nothing. Zilch.

To me that's a big red flag. It has the classic signs of a "magic" technological leap.

 

[nitsuj]

If you look at their Powerwall website, other than whatever details are on that one page there's no other Literature. No spec. sheets, no test results, no whitepapers, no pdf's, no best practices, installation instructions. Nothing. Zilch.

To me that's a big red flag. It has the classic signs of a "magic" technological leap.

Ah..so I'll use it to charge my Segway.

The magical technological leap is upon purchase it makes you feel good being a solution to an energy "problem".

What's more Musk backers see shimmers of hope when Musk adds a Musk multiplier to that sale preventing a balance sheet disaster. So there is some "magic" there too. take a sale of $3,000...multiply it by the number from an internet poll...report to media "The sheer demand here is just staggering!" & "...off the hook!".

What's the carbon foot print of one of these units?

 

[OmCheeto]

If you look at their Powerwall website, other than whatever details are on that one page there's no other Literature. No spec. sheets, no test results, no whitepapers, no pdf's, no best practices, installation instructions. Nothing. Zilch.

To me that's a big red flag. It has the classic signs of a "magic" technological leap.

They listed specs near the bottom of the page. I'll list the clues as to why I believe a 10 year lifespan is doable:

Specs

Technology

Wall mounted, rechargeable lithium ion battery with liquid thermal control.​

Models

10 kWh​

Power

2.0 kW continuous
​

I've never done testing on lithium ion batteries, so I can only take other people's words for how they function:

Understanding the life of lithium ion batteries ...

Note to journalists: Please report that this research was presented at a meeting of the American Chemical Society. (Yay! I think I'll add "journalist" to my resume.)

NEW ORLEANS, April 10, 2013 — Scientists today answered a question that worries millions of owners and potential owners of electric and hybrid vehicles using lithium-ion batteries: How long before the battery pack dies, leaving a sticker-shock bill for a fresh pack or a car ready for the junk heap? Their answer, presented here at the 245th National Meeting & Exposition of the American Chemical Society (ACS), being held here this week, may surprise skeptics.

“The battery pack could be used during a quite reasonable period of time ranging from 5 to 20 years depending on many factors,” said Mikael G. Cugnet, Ph.D., who spoke on the topic. “That’s good news when you consider that some estimates put the average life expectancy of a new car at about eight years.”

Cugnet explained that the lifespan depends mainly on the battery’s temperature, state of charge and charge protocol. Battery performance begins to suffer as soon as the temperature climbs above 86 degrees Fahrenheit. “The higher the temperature, the lower the battery service life,” he said. “A temperature above 86 degrees F affects the battery pack performance instantly and even permanently if it lasts many months like in Middle East countries.”
​

This may take me a while to figure out...

This is worse than taxes and orbital mechanics, combined.

Winter and Summer consumption are best (June-Oct 14 kwh/day) and worst (Jan & Feb 50 kwh/day) cases.

Graphically, over my last 12 recorded billing cycles:

x = date y = kwh/day​

About the only things I've determined so far, is that:

1. a single Tesla Powerwall

a. will keep my refrigerator running during "On" and "Mid" peak hours during the summer (9.3 kwh)
b. will not cover my winter needs (33.3 kwh)​

2. I should do my laundry and dishwashing on Sundays (my water heater is set to 100°F, so I use the "Water Heat" mode on my dishwasher)​

So based on 1.b., I will have to determine a method of storing 23.3 kwh of energy via an alternative method, to make this "Wall" a viable option, for me.

Interesting that Tesla got nearly a billion dollars worth of orders for these type of things in the first week.

Tesla's Battery Grabbed $800 Million in Its First Week (BloombergBusiness)

 

[rollingstein]

a. will keep my refrigerator running during "On" and "Mid" peak hours during the summer (9.3 kwh)

How many Amps does your refrigerator pull? How many Amps will your Laundry / Dishwasher pull?

 

[OmCheeto]

How many Amps does your refrigerator pull? How many Amps will your Laundry / Dishwasher pull?

simple maths: Amps = Watts/Volts

You figure it out!

clues: I've never heard of a 220 volt home fridge, dishwasher, nor clothes washing machine. I seem to recall that there are 120 volt laundry dryers for apartment dwellers.
Ha! I just realized, that I've never been an "apartment" dweller.

hmmm...

 

[rollingstein]

simple maths: Amps = Watts/Volts

You figure it out!

Did you post the Watts somewhere? Maybe I missed that info.

I just wanted to point out that the Powerwall is rated for 6 Amps. I was wondering if you refrigerator + dishwasher / dryer combined load would be able to stay within those Amps. I didn't think it would work.