Tesla Energy and utility scale projects

[EinSV]

It'll be real interesting in 2021 when tons and tons of Powerwalls are spread across CA and Tesla offers to aggregate power on behalf of homeowners. How quickly will they draft up that regulatory language and push for a wildly popular ballot initiative? Tens of thousands of Powerwalls floating out there will flip a regulatory switch <snip>

Yep -- it is hard to imagine that NOT happening at some point ....

 

[TheTalkingMule]

Yep -- it is hard to imagine that NOT happening at some point ....

When people are forced to engage in their energy world, their actions are fairly decisive.

Look at Nevada. No one really cared much about energy regulation and relatively few ratepayers were adversely affected by the PUC anti-solar power grab a couple years ago, but the backlash was huge. Two years later and the monopoly is on its way to being broken.

Hopefully residential solar going mainstream helps people realize they have all the power and utilities are supposed to serve them.

 

[EinSV]

Despite Australia's relatively small population, BNEF predicts it will lead the world this year in residential battery installs with 70,000.
Australia tipped to add 70,000 home batteries in 2019, lead global demand
Australia to Be Largest Residential Storage Market in 2019 | Bloomberg NEF

Imagine if there were similar market penetration in the rest of the developed world.

 

[TheTalkingMule]

Non-Tesla and sodium sulfur, but pretty huge.

UAE integrates 648MWh of sodium sulfur batteries in one swoop

 

[jhm]

Non-Tesla and sodium sulfur, but pretty huge.

UAE integrates 648MWh of sodium sulfur batteries in one swoop

Wow, that is pretty impressive. Can operate at 300 degrees, 6-hour, 15-year life. I wish the report had included cost information.

 

[renim]

There are lots of these NGK system in Japan. Generally cheaper energy but higher power cost compared to li ion.

 

[RiverCard]

Does Tesla Energy have a presence in the Indian sub-continent? AES appears to be getting its snout under the tent with a connected local participant.

"Tata Power Collaborates with AES and Mitsubishi Corporation to Power Up South Asia’s Largest GridScale Energy Storage System in India"

https://www.nseindia.com/corporate/sarigagokul_13022019165534_Pressrelease_324.pdf

 

[TheTalkingMule]

Several fairly large entities in India have backed out of PPAs once they notice the price cut in half 2 years later. Tesla might be hesitant to operate in such an environment until it's more stable.

 

[VValleyEV]

Latest hit piece on GF2 and Tesla Solar:
Government Pressure Mounts On Tesla's Struggling Solar Unit - Tesla, Inc. (NASDAQ:TSLA) | Seeking Alpha

Anything new here? Any positive news/forecasts/predictions elsewhere?

Comments added to article are overwhelmingly negative to outlook of GF2 and Tesla Solar.

 

[TheTalkingMule]

Alberta govt covering 55% of demand with $36/MWh solar. Crazy.

Alberta government signs PPA for 94 MW of subsidy-free solar

 

[jhm]

Battery Power's Latest Plunge in Costs Threatens Coal, Gas | Bloomberg NEF

A 76% decline in the cost of grid battery storage since 2012 is an annual cost decline rate of 21%. This is comparable to the annual cost decline of an EV battery pack, 20%. This should not be much of a surprise because the two technologies relate to the cost of a battery pack.

So what is to keep this going? BNEF estimates the experience curve rate at 18%, i.e., as cumulative battery pack production doubles, the cost per kWh falls by 18%. So the volume growth needs to continue to double in just under 12 months to perpetuate an annual 20% decline rate in both technologies. Now BNEF supposes that EV growth will slow down sufficient to cut the annual cost decline to just 10%. I have a hard time believing this. But even if EV uptake were to slow, the uptake of grid batteries is doubling very fast. So I would speculate that this will continue to result in experience curve advancements for both grid batteries and EV. Thus, I find it very hard that the decline in EV pack costs will slow much below 20%. Indeed, it could accelerate.

Remember that Tesla has been holding back on power product production to focus common GF resources on ramping the Model 3. The rate at which Tesla gains battery experience is only bound by supply constraints. There is simply more demand for battery modules across multiple products than what Tesla can satisfy. So progress along Tesla's experience curve is not slowing down. So why should cost decline slow down?

 

[mongo]

So why should cost decline slow down?

It will as they asymptotically approach the raw material costs. (What that point is I don't know, but there is a floor to cell costs)

 

[TheTalkingMule]

All new grid infrastructure all over St John in the USVI. These guys are poised to handle any type of interconnected microgrid plan. Wouldn't be surprised if Tesla were working on something as has been rumored since just after Hurricane Irma.

New composite poles appear fairly hurricane-proof and have 90% of the island covered.

 

[jhm]

It will as they asymptotically approach the raw material costs. (What that point is I don't know, but there is a floor to cell costs)

The raw material cost depends on the state of technology. As density increases less raw material is needed per kWh. Also the specific mix of materials changes. For example, while the price of cobalt was high, Tesla was making serious progress in reducing the amount of cobalt per kWh. Now that it is cheap again, perhaps this is not so important. The technology advances at least have option value. For example, if cobalt were to go sky high in price, Tesla would have an option to switch to lower cobalt chemistry. So over time the advance of the tech enable both the cost of raw material per kWh to decline and to navigate volatility in the price of specific minerals.

We also have the possibility that certain minerals may actually become cheap to mine as their industry advance to higher scale production. Again the cobalt market has historically be too small to motivate miners to specifically target it. Rather they target copper or nickel which are have much bigger markets, and this affords some associated production of cobalt. But as the cobalt market increases in value, miners will become more competitive in bringing cobalt to market. Lithium has huge potential for technology to decrease mining costs. For example, ocean water could be a good source of lithium if you had a cheap technology for separating trace amounts of the mineral from huge volumes of water. The bigger the lithium market becomes, the more R&D spending goes to improving extraction technologies, which in turn can lower the cost of the raw material.

So the way I think about the experience curve is that it works on every segment of the supply chain. As the production of batteries scales up, it forces every supplied component in the production chain also to scale up. As any one of these supply components scales up, it too is subject to some experience curve, albeit the learning rates may be different and it may take longer to double scale of a particular component. Nevertheless, as each component is scaling into its experience curve, each component may arrive at lower costs. This in turn enables the downstream product, batteries, to continue down its experience curve too cutting total cost. This may sound pretty optimistic, but it is also what makes incumbent technologies so hard to beat. Incumbent technologies have huge well optimized supply chains. The lithium battery supply chain is nowhere near as optimized as say the supply chain for internal combustion engines. But it takes ICE a long time to double cumulative production so cost declines over time are slower and more easily overwhelmed by inflationary forces in the general economy. But if you look at all the components of ICE, those supply streams are large, fiercely competitive and highly optimized. The cumulative effect is hard for any radically new technology to beat. But as batteries scale, the whole supply chain for batteries will become large, fiercely competitive, and highly optimized too.

Another issue particular to the battery supply chain is that most of the minerals can be recycled. So as the tonnage of used lithium batteries grows, recycling becomes an alternative supply to mining. The logistics, scale and technology of recycling batteries will improve and follow an experience curve of its own. The more efficient recycling becomes, the greater the salvage value of batteries will be. So even if over the long run the mineral cost of batteries dominates and slows down the experience curve price reductions for gross battery pack cost, the net cost (new cost minus salvage value) can continue to decline. One is essentially paying rent on the salvage value of the battery plus a small price for recycling and re-manufacturing batteries. The faction of raw materials (not obtained by recycling) can become exceedingly small once EVs have replaced nearly all ICE vehicles in use. Indeed for a real mind bender, consider the possibility that density doubles in ten years. This suggests the possibility that the material used for 1 kWh today could be recycled in about ten years to produce a battery with nearly 2 kWh capacity. The only slippage here is changes in the ratios of minerals and some loss of materials in recycling. Even so the demand for raw materials needed to double battery production over a decade is relatively small. The problem is that right now demand EV batteries will double 5 to 7 times over the next ten years, while doubling density will only suffice for 1 of those doublings. So for the next ten or so years the EV industry will need massive inputs from mining while recycling is only a small contributor to battery supply. But going out 20 years or more, recycling becomes the dominant supply. This is one of the ways that the battery economy will be substantially different from the oil economy. Oil is for the most part a single use mineral, while batteries are highly recyclable. The oil economy was easy to ramp up, but is too costly to maintain (including climate change). However costly the battery economy is to ramp up, it will be much cheaper to maintain.

 

[jhm]

Fortum Process Recycles 80% Of EV Battery Materials | CleanTechnica
Here's a timely article that addresses recyclability of batteries.

In a press release, Kalle Saarimaa, vice president of Fortum Recycling and Waste, says, “There are very few working, economically viable technologies for recycling the majority of materials used in lithium-ion batteries. We saw a challenge that was not yet solved and developed a scalable recycling solution for all industries using batteries.”

There has not yet been the scale to solve these problems yet. But with scale, resources will flow into solving them. The black mass will get whittled down in time.

 

[adiggs]

And of course, recycling of these big li-ion battery packs is potentially their third use / life, rather than second, with their second use being big mobile packs becoming stationary packs. Old Model S packs being swapped out for new upgraded Model S packs, and the old Model S packs moving into the garage as a Powerwall type system (who cares that 85 kWh has degraded down to 60 kWh of usable capacity now - that'd be a HUGE powerwall ) and lives on for another decade or two in that role, before finally being so ancient / decrepit that it goes for recycling (maybe because the second ev's battery pack is being swapped for it's second pack, and can move into the home as the replacement for the home's powerwall )

At least in theory.


And maybe the economic cost of re-purposing battery packs this way is high enough that it really is economically cheaper to just recycle the pack into raw materials and make new packs from the old packs. This all sounds like a really important business and economic problem in 5-15 years or so.

 

[jhm]

Yeah, I'm all in favor of repurposing batteries. It would be cool for Tesla to design modules that can be easily swapped between cars, semis and Powerpacks. This would set up a lifecycle that goes to a car (high capacity, low cycling) for 5 years, then to semi (moderately high capacity, high cycling) for 5 years and finally to Powerpack (reduced capacity, moderate cycling) for another 5 years. Obsolescence is reached when the current use value of the battery is below the salvage value of the battery. That is, in recycling it you create much more value, say twice the storage capacity, than simply continuing to use it.

If you can do the swapping in a low friction way, it makes it much more valuable to do the swapping and maximize the full lifetime value of the module. The service center is able to pull out models and replace with new at very minimal labor cost. The used module goes to the nearest factory to be tested, and depending results goes into a semi pack, power pack or recycle bin. The installation into semi and power packs would also be low labor and logistics cost.

 

[jhm]

BTW, it looks like the first steps of the Fortum process could be done anywhere. And the copper and aluminum could be used just about anywhere, so no need to ship it to another continent. But breaking down the black mass is where specialization may come into play. So it would make sense to collocate the black mass process where batteries are made in very large quantity.

 

[neroden]

Latest hit piece on GF2 and Tesla Solar:
Government Pressure Mounts On Tesla's Struggling Solar Unit - Tesla, Inc. (NASDAQ:TSLA) | Seeking Alpha

Anything new here?

No. Regurgitation.

It's true that GF2 Solar Roof production is delayed and that it doesn't have full staffing; but Tesla's contract with NY actually just requires employment in New York, not at GF2, so if they, for instance, opened a service center in Syracuse, that would count towards the state employment requirements. I really assume they're going to do something like this. FUDsters don't mention this.

Tesla's solar business is proceeding as planned: cash and loan sales are up, and they're killing lease sales deliberately -- something FUDsters never talk about.

 

[SW2Fiddler]

and the old Model S packs moving into the garage as a Powerwall type system

Already a thing!!
And the Module is a better quantum in the calculus of reuse. There are so many things that one can do with Model S packs, for instance, when they are unpacked into more-readily-wielded modules. Fraction of a car pack, stacks of ...how about 62 modules?

So. Many. Things.

And the Model 3 modules will be even more repurpose-y IMHO.