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Tesla Wins Contract to Help Power the California Grid

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Re: Tesla Wins Contract to Help Power the California Grid

#161

Post by wbc »

Roritharr wrote: post #129

Without reading this somewhere or having anything to back it up: This, combined with the acquisition of SolarCity, looks like a move to get Tesla into a different Asset Category to make it even cheaper to loan money. If they can be seen in the same risk/asset-category as a power utility, they can rely even more heavily on loans. Does anyone know if that would be a viable strategy?

unless they're having trouble getting funding w/o loans, this shouldn't matter:

http://www.investopedia.com/terms/m/modigliani-millertheorem...

TLDR: market value is based on earnings power and independent on cost of capital. i don't think the risk of underlying assets change much in this case

Re: Tesla Wins Contract to Help Power the California Grid

#162

Post by paulyg »

mikeash wrote: post #146
paulyg wrote: post #125

Earlier quoted context omitted.

Why are people comparing and debating "batteries vs combustion turbines"? Batteries only store energy and you still need to generate it somewhere. Probably from a CCGT plant. And it's not risk aversion. Its buried subtly in the article but part of SoCal's gas infrastructure is shut down because of the leak. They literally can't provide enough gas to generate enough electricity for peak demand. So they will generate o…

People are comparing them because they serve the same purpose here. Base and peak loads on the grid can be wildly different. Without storage, if you want to avoid brownouts or blackouts, your generating capacity needs to match the peak load, even though you might only hit peak load a few times per year. The traditional way to handle this is to have power plants that can be spun up rapidly but sit idle 99% of the time…

Yes I know how all that works becuase I worked in the utility industry for over a decade.

My point was (1) when comparing peakers vs storage you need to consider the cost of: Off-peak generation + storage cost vs peaker cost. (2) This wasn't a cost driven thing. This is a demand driven thing.

Re: Tesla Wins Contract to Help Power the California Grid

#163

Post by Phlarp »

Hondor wrote: post #114
semi-extrinsic wrote: post #99

Earlier quoted context omitted.

Musk has stated publically that they're betting the company on the battery price coming down for the Model 3 to be profitable. That's why they're building the Gigafactory, to reach $100/kWh. If suddenly power companies start buying lots of batteries, and prices stabilise at or above today's levels, it would mean (by implication) that the Model 3 won't be profitable (at least initially). Sure car batteries and power b…

If prices don't come down, especially due to higher demand, and the car isn't profitable then the battery factory will be instead. Sounds like they win either way.

If this really ends up being the case they can just slow the model 3 deliveries to a trickle-- All those pre-orders are really just an interest free loan with fungible time tables on actual delivery, and the "financing terms" only get better for Tesla the longer they kick the can down the road.

(What is the net present value of $1000 in 2020? 2025?)

Re: Tesla Wins Contract to Help Power the California Grid

#165

Post by paulmd »

hvidgaard wrote: post #119
nl wrote: post #53

Earlier quoted context omitted.

TV isn't the problem. Most of benefits come if you have a system which can regulate slightly your use of air conditioning and heating (and a few other things like pool pumps). In some cases you can save 50% of a daily powerbill by turning off the compressor in an air conditioner for 15 minutes.. but the right 15 minutes. Few people would get up and turn off the air con for that, but a system that let you say how much…

It's a different beast. The price is high during those 15 minutes because of supply and demand. If you implement a smart grid that regulate load, you upset the supply and demand balance and the power might become so cheap that new self regulating systems are not worth the initial cost.

Once the smart-device interface is properly defined and the software is written, the hardware cost should not be a problem.

You will end up with some kind of "smart device" router that connects to your internet/home network to talk to the power company, and uses a commodity wifi interface to talk to your smart devices. The cost of an ESP8266 is already sub-$7 at hobbyist volumes, you can expect the additional hardware cost to easily be driven to trivial levels with widespread adoption.

The problem is purely in getting a standard system out there and designing devices that incorporate the new control model.

Re: Tesla Wins Contract to Help Power the California Grid

#166

Post by zaroth »

nl wrote: post #155
zaroth wrote: post #138

Earlier quoted context omitted.

It's surely less expensive per capita to have reliable electricity for everyone than to have everyone who wants reliable electricity to have to install a generator. 99% uptime means 7 hours of downtime every month . And it's not random downtime, it's downtime under peak demand. If the choice was free electricity at 99% uptime and you have to take care of the rest yourself, or $0.13 / kWh for 99.999% uptime, I would g…

To be clear, in Aus we don't have 99% reliability. It's about 45 min every 2 years (whatever that works out to). That number was to explain the cost savings. In much of the world those cost saving are directly applicable. Most of the world's population doesn't have 99% reliable electricity, and so they build reliability at the edges with everything from batteries in phone towers, to batteries in lighting. It isn't at…

Rooftop solar is on average a $25,000 - $35,000 investment, and that's not even counting energy storage required to actually be off-grid. I don't think that only the rich should have reliable energy, and the poor should suffer brownouts to theoretically save some infrastructure costs.

For countries who don't yet have a reliable electric grid, I think investing in providing quality / reliable electricity to their population is about the best ROI (after providing reliable drinking water) investment they can make.

The economic cost of blackouts and brownouts are extremely high [1] -- for example, the rolling backouts in California back in 2000 - 2001 were estimated to cause GDP loss of 0.7 - 1.5%! (GDP was ~1.2T, so we're talking economic losses on the order of $10 billion).

[1] - http://www.raeng.org.uk/publications/reports/counting-the-co...

Re: Tesla Wins Contract to Help Power the California Grid

#167

Post by kbenson »

planteen wrote: post #122
kwhitefoot wrote: post #120

Earlier quoted context omitted.

Lithium is a common element. The difficulty is always that it is rather even distributed making it expensive to concentrate. It's the kind of thing that is solved simply by scaling up. It is in fact more abundant in the Earth's crust (17ppm) than lead (10ppm) and according to Wikipedia " rel="nofollow">https://en.wikipedia.org/wiki/Abundance_of_elements_in_Earth... 2012 production of lead was 5.2MT while lithium was…

Abundance in Earth's crust doesn't help at all during a supply crunch. Bringing a mine up takes at least 5 years. And your mine is going to be on an orebody, not just processing random rocks. Cobalt is another critical element for batteries I believe.

Lithium is "mined" by pumping underwater brine to a surface pool and letting it evaporate. The cost effectiveness of this apparently caused most Lithium mines to shut down inthe 90's because they couldn't compete[1]. Lithium is also present in seawater, but they apparently don't have a cost effective way to extract it from that yet. Apparently the evaporation process is 18-24 months per batch though, so there is some lead time, just not 5 years (good), and it doesn't necessarily lesson by all that much if you have the facility already set up (as in you can't necessarily throw more people/machines at it for a short term increase, which is bad).

A commercially viable way to extract it from seawater would likely solve any supply problems indefinitely.

This, of course, doesn't address the need for Cobalt, but I'm not sure how much is required for the process.

1: https://en.wikipedia.org/wiki/Lithium#History

Re: Tesla Wins Contract to Help Power the California Grid

#168

Post by Dylan16807 »

paulyg wrote: post #162
mikeash wrote: post #146

Earlier quoted context omitted.

People are comparing them because they serve the same purpose here. Base and peak loads on the grid can be wildly different. Without storage, if you want to avoid brownouts or blackouts, your generating capacity needs to match the peak load, even though you might only hit peak load a few times per year. The traditional way to handle this is to have power plants that can be spun up rapidly but sit idle 99% of the time…

Yes I know how all that works becuase I worked in the utility industry for over a decade. My point was (1) when comparing peakers vs storage you need to consider the cost of: Off-peak generation + storage cost vs peaker cost. (2) This wasn't a cost driven thing. This is a demand driven thing.

People neglect the cost of off-peak generation because it's much cheaper than the other two parts of the equation.

It's still a cost driven thing. They could be emergency-buying or emergency-relocating gas infrastructure over the next few months.

Re: Tesla Wins Contract to Help Power the California Grid

#169

Post by kbenson »

1024core wrote: post #6

> Tesla's contribution is enough to power about 2,500 homes for a full day This is < 0.1% of the total number of homes in SoCal, just to put it in perspective.

But put in another perspective, it's enough to power ~3,6000,000 homes for a minute,or 720,000 homes for 5 minutes. If that can be used to prevent a brownout or blackout, that's a net win in my book.

This of course assumes average use, which isn't really likely in the case you are protecting against the system being unable to cope, but at the same time it's supplemental to the current system, just as an extra few percent of capacity for an area, not meant to power homes directly or without other sources.

Re: Tesla Wins Contract to Help Power the California Grid

#170

Post by honkhonkpants »

tlb wrote: post #31
honkhonkpants wrote: post #8

Why doesn't Panasonic just cut out the middleman here? Are they afraid of making their own deals in america?

Combining thousands of cells into large packs that don't overheat, catch fire, leak, or wear out prematurely turns out to be pretty hard.

At utility scale I expect it is a very simple design problem in fact. It's harder to design them for confined spaces or for crashworthiness but for a fixed installation with no geometric constraints it would be a piece of cake. Anyway Panasonic already has this expertise since they deal in utility projects elsewhere (and in America according to the other comment).
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