Solar Reaches Flipping Point

A few days ago Tesla solved one of the bigger problems for renewable energy – low cost storage.

Tesla’s home battery, named “Powerwall,” is a rechargeable lithium-ion battery that mounts on the wall and comes in 7 kilowatt-hour or 10 kilowatt-hour versions, the company said in a statement. Deliveries will begin in late summer and the price starts from $3,000, Tesla said.”

Distributed energy generation – especially solar, has been growing at a very fast pace in the last few years. Ironically one of the big problems with so may homeowners generating their own power is that grid owners don’t know how to manage all of that surplus electricity flowing back in their direction.

A battery system can help with that but until now those battery systems have been very expensive and only used by those who are off the grid. The Powerwall battery may not be the full answer but it is a revolutionary step in that direction.

Actual mileage will vary ( as they say) – you still need to check the key variables in your location but having cheaper battery technology will change the game. In NZ Utility of the future – A customer-led shift in the electricity sector  (via the WhatPower Crisis websitea PWC industry background is available as a downloadable pdf. A year before Powerwall was even ready those authors noted:

“As battery storage technology becomes more commercially viable, customers will be able to combine solar PV generation and storage; thus enabling them to offset usage during peak tariff periods and rectify the current asymmetry between solar generation and energy consumption patterns.”

Solar in Hawaii

“In Hawaii, where 12 percent of the homes have solar panels, handling the surplus power is putting pressure on the state’s biggest utility.”

“The shift in the electric business is no less profound than those that upended the telecommunications and cable industries in recent decades. It is already remaking the relationship between power companies and the public while raising questions about how to pay for maintaining and operating the nation’s grid.”

It is a huge challenge to the business model and one we will see elsewhere as the critical mass of solar installations grows. See the full story at Solar Power Battle Puts Hawaii at Forefront of Worldwide Changes

“As a result, many utilities are trying desperately to stem the rise of solar, either by reducing incentives, adding steep fees or effectively pushing home solar companies out of the market. In response, those solar companies are fighting back through regulators, lawmakers and the courts.

The shift in the electric business is no less profound than those that upended the telecommunications and cable industries in recent decades. It is already remaking the relationship between power companies and the public while raising questions about how to pay for maintaining and operating the nation’s grid.”….

“It is also upgrading its circuits and meters to better regulate the flow of electricity. Rooftop solar makes far more power than any other single source, said Colton Ching, vice president for energy delivery at Hawaiian Electric, but the utility can neither control nor predict the output.

“At every different moment, we have to make sure that the amount of power we generate is equal to the amount of energy being used, and if we don’t keep that balance things go unstable,” he said, pointing to the illuminated graphs and diagrams tracking energy production from wind and solar farms, as well as coal-fueled generators in the utility’s main control room. But the rooftop systems are “essentially invisible to us,” he said, “because they sit behind a customer’s meter and we don’t have a means to directly measure them.”

What is needed is a new business model for the electricity companies. In Hawaii the local utility barred installations of solar in a number of areas – so much so that some homeowners actually went off the grid altogether by installing batteries to store their power.

That is not an option for most home solar power users but the new Powerwall battery pack from Tesla will change the financial equation once again by adding flexibility to their usage patterns.

A few days after the NYT Hawaii story came out the NBR in New Zealand Renewables menace traditional power model. The heading seems a bit dramatic but it comes from a consultant working in Europe and watching similar changes play out in the German electricity market. Briony Bennett writes

“Alone, one solar-powered household cannot produce enough electricity to perturb the traditional power model. Yet, the arrival of hundreds and thousands of prosumers on the grid has the potential to be destabilising as seen with commercial solar generation.

These four issues are part of a bigger problem: electricity infrastructure and markets are inflexible. They were not designed to manage decentralised and unpredictable electricity production. Nevertheless, this is the model we will have to manage in the future. Distribution lines also have ramping limits constraining how quickly power flows can be increased or decreased. Volatile prosumers and commercial wind and solar farms compromise the grid’s technical stability.”

Predictably there is some denial and over reaction such as Why Tesla’s Powerwall Is Just Another Toy For Rich Green People. Somehow the author of that article misses the point there are many scenarios outside of the typical US setup where a much less expensive storage battery will help consumers dramatically.

Why Tesla’s battery for your home should terrify utilities – Elon Musk’s electricity empire could mean a new type of power grid

“It’s quite a bind: by fighting net metering, utilities would help make battery storage more economically viable, driving the transition to a distributed grid.

Manghani believes utilities aren’t doomed, but they may undergo a radical transformation, becoming something closer to service providers and minders of an increasingly distributed grid rather than the centralized power producers they are today. Such a system would require lots of batteries to help balance the load and supply extra power during peak times, which is why GTM estimates the market will grow from $48 million today to about $1 billion in 2018.”…

“Another potential bright spot for utilities is Tesla itself. If electric vehicles take off, demand for power will go up, helping compensate for people whose homes are relying less on the grid.”

In other related news a few weeks ago I saw a Tesla S up close. It is a seriously impressive all electric car. The owner is investing his own resources to setup charging stations around New Zealand for Tesla’s.

All of which brings us back to the new Tesla Powerwall battery. Anecdotally I have heard of some solar power enthusiasts using a Nissan Leaf as a mobile battery pack for their home generation. At about $40k in NZ that is expensive and probably not that practical but it is much less than the containers full of batteries I have seen over the years.

My daughter wrote up a school project on inventors a few weeks back. Incredibly the “approved” inventor was Edison. I suggested Elon Musk would have been a better choice especially since she is a Marvel comics fan and Musk is as close to a Tony Stark archetype as you could get.

Clearly some utility companies and commentators are still in denial mode about the imminent business model changes signalled by these changes. In New Zealand Meridian Energy has 189 solar panels installed on the roof of the War Memorial Museum.

And in this weeks news the Vector utility is taking the PowerWall battery seriously. Vector enters ‘special relationship’ with Tesla

“Vector has been working for some months to cement this “special relationship” with Tesla to provide the Tesla home battery to New Zealand.

“This is the start of a significant change in the energy industry. Tesla is the largest producer of batteries in the world, as well as the most cost effective, and this strong relationship will allow us to take it to the next level across the country,” said Mackenzie.

Stiassny said that Vector had recognised some time ago that the energy business was destined for change.”

If you haven’t watched the clip below where Musk answers questions on Tesla, Solar City and Space X you really should. It predates the Powerwall battery announcement.

I love the part in this clip where Musk says that reasoning from first principles leads to breakthroughs rather than reasoning by analogy which is our default thinking mode.

Well, I do think there’s a good framework for thinking. It is physics. You know, the sort of first principles reasoning. Generally I think there are — what I mean by that is, boil things down to their fundamental truths and reason up from there, as opposed to reasoning by analogy.Through most of our life, we get through life by reasoning by analogy, which essentially means copying what other people do with slight variations. And you have to do that. Otherwise, mentally, you wouldn’t be able to get through the day.

But when you want to do something new, you have to apply the physics approach. Physics is really figuring out how to discover new things that are counterintuitive, like quantum mechanics. It’s really counterintuitive. So I think that’s an important thing to do, and then also to really pay attention to negative feedback, and solicit it, particularly from friends. This may sound like simple advice, but hardly anyone does that, and it’s incredibly helpful.

In my view solar are reached a flipping / tipping point and that is hugely positive.

P.S Another view : The Tesla battery heralds the beginning of the end for fossil fuels