Tesla CTO on Energy Storage: ‘We Should All Be Thinking Bigger’

[equinox1981]

There's nice linearity to how grid storage can develop in places like HI, other islands, and third world markets where fuel oil is actually still predominantly used. The bogie is $.30-.40/kwh in them. Barclays noted a $.22/kwh rate as the amortized cost of batteries ($250/kwh, 14kwh over 10yrs) and panels (9kw, over 25yrs). I am assuming we knew they downgraded the American utility sector last week, to underweight? It had a lot to do with this very topic.

Residential is where the traction comes from, IMO, as homeowners aren't saddled to transmission and all sorts of other O&M costs. "grid as back up" charges are the future. Flat utility charges, regardless of consumption, and other adversarial self-inflicted utility policies will hasten a drive for independent generation/consumption. Yes, I look at the grid a lot.

2:1 rough auto / storage giga production is news to me. I thought the second-use pipeline was how this was going to go. I also wonder what the QC rate is on 18650s, and if some have ended up in the 2MWH they have going? Fascinating stuff.

Interesting, great insights. That's why I read these forums! If utilities were smart, they'd be building their business models around being the ones to finance, install and manage that in-house storage. If the history of technological disruption is any guide I doubt it will come from them though.

I used to feel that widespread renewable energy adoption was fairly unlikely anytime soon, with a variety of barriers that could stop it dead in its tracks. Now I feel the opposite is true... Utilities can try to kill it renewables/storage, but consumers will just go do it anyway. Western fossil fuel companies could try to kill it - but then China will just do it, or India, or South America, and we will eventually be shamed to get on board. Exciting times!

 

[aronth5]

What impressed me about the video is how it demonstrates how efficiently and quietly Tesla goes about testing new approaches to solve age old problems. It's not just a about deploying technology but using technology to solve real world business problems. JB did a nice job challenging the grid focused audience to think out of the box. The technology is new, the business model is evolving but Tesla is getting real world experience that should keep them a step ahead of competitors.

 

[techmaven]

Some fun napkin mathematics - please correct me:

So each one of those skids of 400 kWh probably costs a little more than $100k retail price. ($16k * 4.5 + $8k) + 25% profit = $100k. Assuming the 400kWh is actual cell capacity and usable capacity is 78%.

$100,000 / ($0.826/kWh peak PG&E demand rate - $0.193 (off-peak) ) = ~160,000 kWh to break even. If one only used this during the 4 hours of that peak charge each day, and the total usable capacity is utilized, that would be 512 days to break even. So roughly 1.5 years to break even. Assuming 10 year service life, this can save something like $500,000 over the course of its life assuming no change in the difference in electricity rates.

This is for the commercial use case, not the utility use case.

JB mentioned that cycle life was somewhere between 300 and 20-30k cycles. He also said they design for 10 year lifespan in both cars and their stationary devices. So this device is likely cycled once a day, so that's 10 x 365 = 3650 designed cycles (or 2600 w/o weekends). For a Model S, that's 600k miles using the upper number, 400k miles using the lower number. But of course, the car application is a far harsher environment. So using the 400k number, take 75% of that... 300k miles.

 

[Dave EV]

Some fun napkin mathematics - please correct me

Look around the 25:00 mark on this video to see an example of what a single 200 kW / 400 kWh storage unit can do at the Tejon Ranch SuperCharger:
2014 Energy Storage Symposium - JB Straubels Keynote - YouTube

You can see that it's delivered around 400 kWh (starting the day full, ending nearly empty, but tops up a bit a few times - would love to get a high res pic of that slide!).

But what's really important is that it's knocking off around 175 kW on the grid demand charge.

Remember that the utility will charge you a demand fee in addition to the energy fee for high demand utility connections like this rather than bundling demand/energy charges into a flat price per kWh. In California, you typically have to use a demand-based fee if your 15 minute peak demand in any month exceeds 20 kW.

For example, in SCE territory which I believe Tejon Ranch falls under (20-500 kW), you could use the TOU-EV-4 rate which has a $12.74 / kW demand charge. So if they can reduce demand by 175 kW, that saves ~$2,200 / month.

Note that this demand charge is actually cheap! Peak demand charges for the major utilities in California in the summer is typically around $25 / kW, so this storage unit could save twice as much each month - and that's in addition to the money saved by shifting demand from off-peak to on-peak - $0.03 / kWh in the winter and $0.21 / kWh in the summer on the SCE TOU-EV-4 rate, or a maximum of ~$10 / day ($300 / mo) in the winter and ~$70 / day ($2,100 / mo in the summer.

So potential savings on the TOU-EV-4 plan could be ~$38k / year.

Electric Vehicle Rates | Rates | Your Business | Home - SCE

PS: Is PG&E really $0.826 / kWh for peak rates? That's insane.

 

[Joeviocoe]

Where can I find the Slides for this presentation?

 

[ItsNotAboutTheMoney]

2:1 rough auto / storage giga production is news to me. I thought the second-use pipeline was how this was going to go. I also wonder what the QC rate is on 18650s, and if some have ended up in the 2MWH they have going? Fascinating stuff.

There's has been a lot of mention of 2nd use, I think because with a high up-front cost, companies had been look at ways to extract additional value from the batteries or cells. But to me the 2nd-use pipeline has 2 key issues:
- The shortened liftspan increases the frequency of battery replacement, and each replacement has processing, transportation and installation overheads.
- As JB Straubel noted in his presentation, the automotive and stationary batteries have very different usage profiles so 2nd-use storage devices re-using automotive batteries could never be optimal.

JB Straubel spoke about recycling, and noted that in an expansion phase the amount to recycle is relatively small, so recycling won't happen for a while, but noted that they are already looking into on-site recycling. To be produced at the scale that would make Tesla happy, 2nd-use storage devices need more old batteries. Tesla's interest in them may return once the battery capacity supply is larger and they need to get recycling going, but given the significant cost reductions they are seeing, the longer life and potential optimization advantages of a 1st-use battery I can't blame Tesla for jumping in with 4 feet.

While I expect 2nd-use storage to happen, I think that due to overheads it will be limited to high-capacity commercial storage and I think that the ideal location would be at gigafactories themselves where they could best process use batteries and maximize automation of the 2nd-use system.

PS I repeat: I man❤ JB Straubel.

 

[stopcrazypp]

To be produced at the scale that would make Tesla happy, 2nd-use storage devices need more old batteries.

I think this is a bigger issue than the others you mentioned. There's simply way to little old batteries out there to make a viable 2nd-use market. It may take another decade or so before there is a decent supply. In the meantime, Tesla's gigafactory can fill in for the demand for cheaper stationary energy storage.