I'd love to see such a chart with actual U.S. retail prices for energy storage, both Lithium-based and alternative. My intention was to show that as with long-range EVs, especially in Europe, there is no real competition for Tesla in the home battery market either.
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ZachShahan
Active Member
Thanks. Yes, I think you've nailed it now. $2,300 looks like a much better estimate for the inverter, and the addition of the guarantee terms is great!
If no one else beats me to it, I plan to do a comparison for the US market for a CleanTechnica article. Also, I got a lot of emails before the announcement from residential and utility-scale energy storage companies offering to comment on the news (before the news was out...). I'm now asking them to answer questions regarding price and some other matters -- many of them don't show prices on their websites. I'm not expecting to get much from them, but we'll see.
Btw, mind if I use your table in the CleanTechnica piece?
- - - Updated - - -
I'm planning to for a CleanTechnica article. Though, I've got a lot on my plate in the coming couple of days, so will have to wait for a bit. And if someone beats me to it, I'm happy to save the time.
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This is how Powerwall works out for Australian electricity prices:
Assumptions:
Ave household usage 30kWh
There is at least 7kWh usage at peak rate available to shift to off-peak rate with Powerwall. Such load is likely to be available for high usage households, say higher than 25kWh/day.
Daily load shift of 7kWh from peak to off-peak rate can provide $494/year bill saving if we factor in 0.92 efficiency.
All numbers in AUD.
Assumptions:
Ave household usage 30kWh
There is at least 7kWh usage at peak rate available to shift to off-peak rate with Powerwall. Such load is likely to be available for high usage households, say higher than 25kWh/day.
Daily load shift of 7kWh from peak to off-peak rate can provide $494/year bill saving if we factor in 0.92 efficiency.
All numbers in AUD.
jhm
Well-Known Member
So this looks about breakeven on load shifting if you have to buy an inverter too. Are there other rate plans available? Perhaps there are TOU plans that would give you wider spread. But even at breakeven, it could be a no cost way just to get backup power. And of course those with solar panels may find it truly cost effective, and the solar inverter can get double duty.
One thing for investors to keep in mind is this PowerWall does not have to be a money saver for all households at this point. Basically, this product will be supply constrained until the Gigafactory is up to capacity. So in the meantime, we may as well get a solid gross margin on those use cases where the greatest savings are possible. By 2020 this product could drop from $3000 to $2000 (inverters and solar become cheaper too), and all along the way new use cases become compelling.
There are multitude of rate plans but it is quite difficult to get rates quoted, there is a lot of fluff talk on providers websites, but I found only one that put actual rates up. I pay a flat rate of 24c/kWh, with some fluff talk about summer and winter rates etc, but lets keep it simple.
The rates that I put up are illustrative, rates from other providers in Australia are likely to be similar. What really matters is the differential between off-peak and peak for households with no solar.
Households with solar will have different economics.
For this product to be economical, a household needs to have 7kWh/day of usage @ peak rates available to shift to off-peak rates.
Off peak hours are 11pm to 7am, all power consumed during this time is at off-peak rates (hours may vary).
Peak hours are 7am to 11pm, all power consumed during this time is at peak rates.
Household charges PW (Powerwall) at off-peak rates during off-peak hours and discharges PW during peak hours, thus realizing the savings due to rates differential.
If we assume electricity consumption ratio peak/off peak to be 0.3/0.7, then it is safe to assume that the households need to consume at least (7/0.3)*0.7+7 = 24kWh/day in order to have 7kWh consumption during peak rate hours. I would say that Tesla team sized up their PW about right for the average western household.
Households with a consumption lesser than 24kWh/day are less likely to be in a market for this product due to worsening economics.
Lets say that the differential between peak and off-peak rate is X in c/kWh.
Load shifting happens every day, 0.92 efficiency. We want 10 year return on $5,000 capital for installed PW.
X x 7 x 365 x 0.92 = 5000 / 10
X = 21.3c
We need a rate differential of 21.3c (USD) to get 10-year return on installed PW.
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If losses are higher, then it is easy to scale back calculations accordingly. I was curious about the potential and the order of savings, hence rough calculations.
Storage economics do not seem attractive in households without solar, in households with low daily kWh use and in regions with low peak/off-peak differential.
I will check my employers electricity rates tomorrow. Economics of load shifting are likely to be better for commercial users.
jhm
Well-Known Member
This looks like a good calculation. Certainly one can adjust the round trip efficiency if they like. But also this can modified to account for the value of backup, incentives and residual value after 10 years. Let suppose that suppose that the you are personally willing to pay $5/month for the assurance of backup, that your government gives say a 10% tax credit and that residual value is at least $300 in recoverable materials of recycled. This is an adjustment to $5000 of $1400 = 5×120 + 0.1×5000 + 300. So the net cost is $3600 and an LCOE of 14.09 c/kWh with 100% round trip efficiency. It seems that adjusting for less than 100 efficiency should depend on the rate you are charging at, not necessarily the rate differential. To account for inverter inefficiency, suppose 85% efficiency. Thus LCOE (.85) = LCOE(1) + 0.15/0.85 × rate_charge. So assuming 11 c/kWh charging rate, I get a LCOE of 16.03 c/kWh at 85% efficiency. So the 11c base rate added about 2c for round trip losses.
So if you have an opportunity to charge at a really low rate, then the cost of round trip inefficiency gets really small. My utility offers plans that have off peak rates 10 pm to 7 am that are under 5 c/kWh, peak at around 15 c and super peak in summer at 20 c. So this is near breakeven. However given that I have an EV that needs about 10 kWh per day, I could also charge that at night as well. Without the PW this rate plan did not make sense for an EV alone because while I could save money charging the car at night the rest of my power bill could go up relative to the flat rate plan I am currently on. But adding a second PW could tip the scale. Also adding second EV or solar could change the economics as well.
It would be very smart marketing for Tesla to do the math on local utility rate plans and configurations of EVs and solar to determine the best rate plans and how it nets out. My utility's rates are not so transparent, despite public notification requirements. While the tariffs are published it is very hard to figure out the formulas to apply all of them.
CO. first, I totally agree on the cycling issue, this might not be a viable solutions, and I have not done the math either. It might very well be that the more frequently cycled 7kWh system really need another cell. So, all of the following disregard this, and I leave for someone to do the math on cycling.
But this does makes sense from a technical point of view as discussed in the storage technical thread (e.g., to achieve same voltage and amperage for same electronics parts). And, I think you overestimate the cost implications of giving away these 3 extra kWh for free from a business point of view. Below is more detailed table on the cost side. If you assume 25% margin on the 10kWh battery, you end up with half that, 12.5% margin, for the "7 is really a 10kWh pack" case. The cost difference, assuming the same cells, is 375 USD, not 600 USD, if my estimate of about 175 USD/kWh at cell level is correct.
Sure, there are many reasons to not sell the 7kWh pack with this discount, and loose this margin. It is a clear risk that the 7kWh version will sell best, since this is intended to be paired with PVs. But it might be the case that the engineering of two different products with the same voltage etc does not makes sense. They need to solve the cycling issue somehow, this could be a solution. And, it definitely makes sense to just by one type of cell to really realize volume, if this is a possibility. The importance of giving Panasonic confidence on deliveries of a given cell type should not be underestimated. Managing just 1 for the cars and 1 for stationary storage seem very attractive to me.
Finally, the consumer power wall product is just one aspect of this new business. I would say the industry and grid and utility scale products is the real game changer, and this is what will drive revenue generation for the moment. The grid benefits are apparent, and the real kicker as Elon mentioned on twitter. The much smaller battery packs in the Power wall products is a game changer to, but currently not low enough in cost to generate demand for all PV home systems. And, this is important in turn, Tesla might very well choose to accept lower margins on these PV storage versions, to foster growth as fast as possible in this particular segment as it holds great long term potential.
But this does makes sense from a technical point of view as discussed in the storage technical thread (e.g., to achieve same voltage and amperage for same electronics parts). And, I think you overestimate the cost implications of giving away these 3 extra kWh for free from a business point of view. Below is more detailed table on the cost side. If you assume 25% margin on the 10kWh battery, you end up with half that, 12.5% margin, for the "7 is really a 10kWh pack" case. The cost difference, assuming the same cells, is 375 USD, not 600 USD, if my estimate of about 175 USD/kWh at cell level is correct.
| 10kWh | 7kWh | 7 kWh is 10 kWh case | |
| Price, USD | 3500 | 3000 | 3000 |
| Capacity, kWh | 10 | 7 | 10 |
| USD/kWh - Product level | 350 | 429 | 300 |
| Margin, % | 0,25 | 0,25 | 0,125 |
| Maring, USD | 875 | 750 | 375 |
| Cost of prod, USD | 2625 | 2250 | 2625 |
| USD/kWh - Pack level | 263 | 321 | 263 |
| Share of Pack overhead (50% overhaed) | 0,33 | 0,33 | 0,33 |
| Pack overhead, USD | 866 | 743 | 866 |
| Remaining cell cost, USD | 1759 | 1508 | 1759 |
| USD/kWh - Cell level | 176 | 215 | 176 |
Finally, the consumer power wall product is just one aspect of this new business. I would say the industry and grid and utility scale products is the real game changer, and this is what will drive revenue generation for the moment. The grid benefits are apparent, and the real kicker as Elon mentioned on twitter. The much smaller battery packs in the Power wall products is a game changer to, but currently not low enough in cost to generate demand for all PV home systems. And, this is important in turn, Tesla might very well choose to accept lower margins on these PV storage versions, to foster growth as fast as possible in this particular segment as it holds great long term potential.
Tesla Batteries in New Zealand / power company States
Vector has formed a partnership with Tesla to bring its revolutionary home and business batteries to New Zealand.
The utility company's bosses were at the Los Angeles launch of Tesla batteries, touted as being able to fundamentally change the world energy market.
Mackenzie said that the potential benefits for customers in New Zealand were considerable.
"For some communities, communal renewables and storage systems make a great deal of sense.
Vector has formed a partnership with Tesla to bring its revolutionary home and business batteries to New Zealand.
The utility company's bosses were at the Los Angeles launch of Tesla batteries, touted as being able to fundamentally change the world energy market.
Mackenzie said that the potential benefits for customers in New Zealand were considerable.
"For some communities, communal renewables and storage systems make a great deal of sense.
Its going to take a while for people to get this, for one reason, because of articles like this:
Tesla faces competition for customers, subsidies - Yahoo Finance
With this "analysis" -
On the contrary, Tesla is far from the only company offering such systems, and industry insiders say the cost of a Tesla system, which starts at $3,000 for a home storage battery pack, is in line with the rest of the market.
how did the author/reporter arrive at this conclusion - well, he just asked AES & Coda.
thanks again Newb for actually running numbers...
Note: I posted a comment referencing Newb's numbers and it was deleted...funny.
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jhm
Well-Known Member
Very nice. I've also heard that SolarCity has recently entered NZ as well. I think this may be the first international expansion for SolarCity.
In any case, PowerWall and PowerPack will have an immediate global footprint and flow first into those markets that can make best use of them. So I love to see these reports.
cheers. Need to digest that quote again:
"On the contrary, Tesla is far from the only company offering such systems, and industry insiders say the cost of a Tesla system, which starts at $3,000 for a home storage battery pack, is in line with the rest of the market. [
]Established and deep-pocketed energy and technology players like Samsung SDI Co Ltd, LG Chem Ltd and Saft Groupe SA are just a few of the names marketing products similar to Tesla's - small batteries to pair with solar panels at homes and businesses"
Yeah, and again here are the numbers for those deep-pocketed energy and technology players offering their similar products in the retail market of the biggest solar power producer in the world, namely Germany:
- Saft Groupe (e.g. in Bosch Power Tec) ~$1,700/kwh
- Samsung SDI ESS ~$1,200/kwh
- LG Chem (e.g. in IBC Solar) ~$1,100/kwh
- Tesla Powerwall ~$450/kwh
jhm
Well-Known Member
cheers. Need to digest that quote again:
"On the contrary, Tesla is far from the only company offering such systems, and industry insiders say the cost of a Tesla system, which starts at $3,000 for a home storage battery pack, is in line with the rest of the market. [
Established and deep-pocketed energy and technology players like Samsung SDI Co Ltd, LG Chem Ltd and Saft Groupe SA are just a few of the names marketing products similar to Tesla's - small batteries to pair with solar panels at homes and businesses"
Yeah, and again here are the numbers for those deep-pocketed energy and technology players offering their similar products in the retail market of the biggest solar power producer in the world, namely Germany:
And that Tesla's competitors are far behind is actually no surprise, if you think about it in relation to the BEV market: The most cost-effective battery packs (per kwh) are in the Model S, followed by Nissan Leaf (LG Chem) and BMW i cars (Samsung SDI) - the same ranking of technology leadership and cost-effectiveness with home batteries obviously.
- Saft Groupe (e.g. in Bosch Power Tec) ~$1,700/kwh
- Samsung SDI ESS ~$1,200/kwh
- LG Chem (e.g. in IBC Solar) ~$1,100/kwh
- Tesla Powerwall ~$450/kwh
Nice. So what happens when these other players are forced to offer better batteries and cheaper prices for stationary than they currently put into cars? In stationary, the batteries compete head to head. So Tesla is forcing these players to build better batteries. This should improve the batteries going into autos as well.
Gerasimental
Member
Smart energy storage with AGL - AGL - Energy in Action
AGL, an Australian energy company also just launched a home storage battery. No details on their website at all, but this article claims they are offering a 6kWh system aimed at customers with 3-4.5kW of solar power installed. Still, nothing on price, chemistry, size, cycling, etc.
Update: In fact I just found some details on their site after all.
-7.2kWh battery that cycles through 6kWh
-Designed for 5000 cycles or 10 years, whichever happens first.
-5 year warranty
-3kW maximum discharge, i.e. 2C rate.
-Dimensions: 672mm x 384mm x 682mm
-Mass: 140kg
-Comes in a bundle with PVs but no indication of power electronics being included.
Source: http://aglsolar.com.au/wp-content/uploads/2015/05/Power-Advantage2.pdf
AGL, an Australian energy company also just launched a home storage battery. No details on their website at all, but this article claims they are offering a 6kWh system aimed at customers with 3-4.5kW of solar power installed. Still, nothing on price, chemistry, size, cycling, etc.
Update: In fact I just found some details on their site after all.
-7.2kWh battery that cycles through 6kWh
-Designed for 5000 cycles or 10 years, whichever happens first.
-5 year warranty
-3kW maximum discharge, i.e. 2C rate.
-Dimensions: 672mm x 384mm x 682mm
-Mass: 140kg
-Comes in a bundle with PVs but no indication of power electronics being included.
Source: http://aglsolar.com.au/wp-content/uploads/2015/05/Power-Advantage2.pdf
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@trils0n: I could research and provide the dimensions for the storage systems but it's hard to tell how big the inverters are which are included in the systems, and so on. Thus, it would make it difficult to compare the actual battery packs. Just checked the Bosch Power Tec Hybrid system and it's 597mm (width) x 1,693mm (height) x 706mm (depth), regardless of the battery size (4.4-13.2 kwh).
Tesla Powerwall is 860 mm (width) x 1300 mm (height) x 180 mm (depth)
Tesla Powerwall is 860 mm (width) x 1300 mm (height) x 180 mm (depth)
And then THIS quite shoddy piece of journalism starts getting republished in the great FUD echo chamber that is financial media...if you say it enough, does it become fact?cheers. Need to digest that quote again:
"On the contrary, Tesla is far from the only company offering such systems, and industry insiders say the cost of a Tesla system, which starts at $3,000 for a home storage battery pack, is in line with the rest of the market. [
Established and deep-pocketed energy and technology players like Samsung SDI Co Ltd, LG Chem Ltd and Saft Groupe SA are just a few of the names marketing products similar to Tesla's - small batteries to pair with solar panels at homes and businesses"
Yeah, and again here are the numbers for those deep-pocketed energy and technology players offering their similar products in the retail market of the biggest solar power producer in the world, namely Germany:
And that Tesla's competitors are far behind is actually no surprise, if you think about it in relation to the BEV market: The most cost-effective battery packs (per kwh) are in the Model S, followed by Nissan Leaf (LG Chem) and BMW i cars (Samsung SDI) - the same ranking of technology leadership and cost-effectiveness with home batteries obviously.
- Saft Groupe (e.g. in Bosch Power Tec) ~$1,700/kwh
- Samsung SDI ESS ~$1,200/kwh
- LG Chem (e.g. in IBC Solar) ~$1,100/kwh
- Tesla Powerwall ~$450/kwh
Will Tesla (TSLA) Stock be Affected by Battery Business Competition? - TheStreet
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