Late tonight at the Tesla Design Studio in Hawthorne, CA, Tesla Motors CEO Elon Musk unveiled the Powerwall, the electric automaker's expected home battery system as well as an ambitious plan to shift the world to renewable energy.
Musk is trying to steer his electric car company's battery technology into homes and businesses as part of an elaborate plan to reshape the power grid with millions of small power plants made of solar panels on roofs and batteries in garages.
Musk, a billionaire, is renowned for pursuing far-out projects. For instance, colonizing Mars is one of Musk's goals at Space X, a rocket maker that he also runs. Speaking at the Powerwall event, he said that the world's energy solution can start with an energy source in the sky that just works: the sun. The problem, of course, is that the sun doesn't shine at night. The solution? Tesla's home battery system which is made up of both the Powerwall (for home use) and the larger, industrial Powerpack. The Powerwall will be available in different colors and hangs on the wall, which Musk said is vital since it means you don't need a battery room to get the benefits of home energy storage.
The basic 7-kWh Powerwall system start at $3,000 while the 10-kWh model is $3,500, and up to ten of them can be connected if you really want a 90-kWh home energy solution. With the 100-kWh Powerpack, there is no upper kWh limit. A Powerpack can be, "a great solution to people in remote parts of the world," where electricity is intermittent, Musk said. In fact, he envisioned a future where Powerwalls are adopted in like cell phones have been in developing countries. Rural electricity could leapfrog the transmission line era with massive installations of solar panels and Powerwalls and be done with it.
Musk said that customers can order Powerwalls today and the first deliveries will happen this summer. The first units will be made at Tesla's Fremont facility, but the number of available Powerwalls will ramp up next year when production shifts to the Gigafactory. Musk said that the Nevada facility is just "Gigafactory 1," and that there will need to be many other companies building Gigafactory-class production facilities to actually shift the world to renewable energy. To encourage this, Tesla's policy of open patents will continue with the Gigafactory and batteries.
Musk even had some numbers for what would be required to create this change. To transition the buildings in the US to use renewable energy, you would need 160 million Powerpacks (the 100-kWh models) that could accept green energy when its made and deliver it when needed, he said. With 900 million Powerpacks, you could transition the world. And, to transition all of the energy used for buildings and for transportation to renewable energy, you would need two billion power packs. This is "not impossible, it's really something we can do," he said.
Current home energy solutions primarily serves as expensive backup systems during blackouts for customers like David Cunningham, an aerospace engineer from Foster City, CA. He installed a Tesla battery late last year to pair with his solar panels as part of a pilot program run by the California Public Utilities Commission to test home battery performance.
Although Cunningham's home has not endured a blackout in the six months that he has had the battery, it's capable of running critical home appliances like lights and refrigeration and can be recharged by solar panels during the day.
"As long as a person has solar panels, it's just a natural fit for the two to go together," Cunningham, 77, said. "I consider it to be a whole power system right here in my home."
Cunningham took advantage of state incentives that sharply reduced the battery's $18,300 sticker price under the pilot program. He still paid $7,500.
"The value proposition now is around reliability and backup power more than it is around savings, but over time that may change," said Shayle Kahn, an analyst at GTM Research.
The batteries are likely to become more useful if, as expected, more utilities and regulators allow power prices to change throughout the day based on market conditions. That way, the software that controls the solar and battery system will allow customers to use their home-generated power - and not expensive grid power - when grid prices spike.
Many commercial customers already buy power this way, and Tesla is expected to announce battery systems designed for them, along with bigger battery packs that utilities can use to manage their grids. Analysts say these utility and commercial markets will probably be more promising for Tesla during the next few years than residential customers.
The long-term goal is to create regional networks of home batteries that could be controlled as if they were a power plant. That would give utilities another way to ensure that they can provide power at times of peak demand.
"You have to allow the owner to unbundle the value in the battery," said Ken Munson, CEO of Sunverge, a power storage company teaming with the solar panel maker SunPower to develop a battery service that utilities can use and potentially profit from.
Tesla is building a giant factory in Nevada that will begin churning out batteries in 2017, so Musk needs to begin drumming up customers now. The spotlight may help Musk push policy makers and utilities to consider reshaping regulations so solar and battery storage could be more easily incorporated into the larger electric system, Kahn said.
Tesla's ambitions already have intrigued homeowners like Mike Thielen, who installed one of the prototype batteries with SolarCity panels on his Redondo Beach, California, home last year. Although he hasn't needed the backup power yet, he has embraced the concept.
"I think it's brilliant," he said. "I would consider upgrading to a more powerful home battery if they could figure out a way to get me totally off the grid."
TSLA stock traded down in the hours before the announcement. Japanese Prime Minister Shinzo Abe visited Tesla Motors today as well.
The world currently consumes 20 trillion kWh of energy annually.
Enough energy to power a single family home for 1.8 billion years or supply energy to a nuclear power plant for 2,300 years (or launch the Falcon 9 rocket seventeen million times).
Of all the fossil fuel consumed in the United States, one third is used in transportation and another third goes to electricity production. The US electric power sector alone produces over 2,000 million metric tons of CO2 which is like burning 225 billion gallons of gas. The EPA says it would require 1.6 billion acres of US forest to negate the environmental damage.
What if we could move the electricity grid off of fossil fuels and towards renewable energy sources?
Once we're able to rely on renewable energy sources for our power consumption, the top 50% of the dirtiest power generation resources could retire early. We would have a cleaner, smaller, and more resilient energy grid.
Today, Tesla introduces Tesla Energy, a suite of batteries for homes, businesses, and utilities fostering a clean energy ecosystem and helping wean the world off fossil fuels.
Tesla is not just an automotive company, it's an energy innovation company. Tesla Energy is a critical step in this mission to enable zero emission power generation.
With Tesla Energy, Tesla is amplifying its efforts to accelerate the move away from fossil fuels to a sustainable energy future with Tesla batteries, enabling homes, business, and utilities to store sustainable and renewable energy to manage power demand, provide backup power and increase grid resilience.
Tesla is already working with utilities and other renewable power partners around the world to deploy storage on the grid to improve resiliency and cleanliness of the grid as a whole.
Powerwall Home Battery
The Tesla Powerwall is a rechargeable lithium-ion battery designed to store energy at a residential level for load shifting, backup power and self-consumption of solar power generation. The Powerwall consists of Tesla's lithium-ion battery pack, liquid thermal control system and software that receives dispatch commands from a solar inverter. The unit mounts seamlessly on a wall and is integrated with the local grid to harness excess power and give customers the flexibility to draw energy from their own reserve.
The battery can provide a number of different beneﬁts to the customer including:
Load shifting – The battery can provide ﬁnancial savings to its owner by charging during low rate periods when demand for electricity is lower and discharging during more expensive rate periods when electricity demand is higher
Increasing self-consumption of solar power generation – The battery can store surplus solar energy not used at the time it is generated and use that energy later when the sun is not shining
Back-up power – Assures power in the event of an outage
The Powerwall Home Battery increases the capacity for a household's solar consumption, while also offering backup functionality during grid outages.
The Powerwall is available in 10kWh, optimized for backup applications or 7kWh optimized for daily use applications. Both can be connected with solar or grid and both can provide backup power. The 10kWh Powerwall is optimized to provide backup when the grid goes down, providing power for your home when you need it most. When paired with solar power, the 7kWh Powerwall can be used in daily cycling to extend the environmental and cost benefits of solar into the night when sunlight is unavailable.
Tesla's selling price to installers is $3500 for 10kWh and $3000 for 7kWh. (Price excludes inverter and installation.) Deliveries begin in late Summer.
Mounting: Wall Mounted Indoor/Outdoor
Inverter: Pairs with growing list of inverters
Energy: 7kWh or 10kWh
Continuous Power: 2kW
Peak Power: 3kW
Round Trip Efficiency: >92%
Operating Temperature Range: -20C (-4F) to 43C (110F)
Warranty: 10 years
Dimensions: H: 1300mm W: 860mm D:180mm
Tesla channel partners for the Powerwall
TreeHouse, a sustainable home improvement store, is collaborating with Tesla to sell the Powerwall home battery. "For the first time, running your home on a battery will be affordable and easy," says TreeHouse co-founder and president Jason Ballard. "I think in the near future, having a battery in your home will be as normal as having a water heater or a dishwasher." Ballard added, "This just takes us one step closer to being able to power homes completely without the use of fossil fuels."
SolarEdge, a leader in the global PV inverter market, and Tesla partnered for the joint development of a PV storage and backup power solution for the worldwide residential solar market. Building on SolarEdge's proven DC optimized inverter proven and Tesla's leading automotive-grade battery technology, the solution will require only a single SolarEdge inverter to manage both PV and storage functions. The system is designed for efficient, outdoor installation and includes remote monitoring and troubleshooting to keep operations and maintenance costs low.
Founded in 2006, SolarEdge provides an intelligent inverter solution that has changed the way power is harvested and managed in solar photovoltaic systems. The SolarEdge DC optimized inverter system maximizes power generation at the individual PV module-level while lowering the cost of energy produced by the solar PV system. Since beginning commercial shipments in 2010, SolarEdge has shipped more than 1.3 Gigawatt (''GW'') of its DC optimized inverter systems, including over 220,000 inverters, its products have been installed in PV systems in more than 73 countries, and more than 100,000 systems are monitored in its cloud-based monitoring portal.
Green Mountain Power
At Green Mountain Power we are thrilled to bring Tesla's innovative home battery storage to Vermont as part of a radical transformation of how energy is generated and used to empower customers to save money and increase reliability and resiliency. As Vermont's energy company of the future, we are turning the old utility model on its head, and offering products and services to help Vermonters use less energy and one day rely on the grid as a backup system. GMP is focused on a future that moves away from dirty inefficient sources of energy to a clean, sustainable and cost effective energy future. The Tesla home battery storage option will speed up the pace of change and keep Vermont on the cutting edge of innovation."
Tesla Energy for Businesses
Based on the powertrain architecture and components of Tesla electric vehicles, Tesla energy storage systems deliver broad application compatibility and streamlined installation by integrating batteries, power electronics, thermal management and controls into a turn key system.
Tesla's energy storage allows businesses to capture the full potential of their facility's solar arrays by storing excess generation for later use and delivering solar power at all times. Business Storage anticipates and discharges stored power during a facility's times of highest usage, reducing the demand charge component of the energy energy bills.
Energy storage for business is designed to:
Maximize consumption of on-site clean power
Avoid peak demand charges
Buy electricity when it's cheapest
Get paid by utility or intermediate service providers for participating in grid services
Back up critical business operations in the event of a power outage
Tesla Energy businesses
Launched in 2006, Amazon Web Services (AWS) offers a robust, fully featured technology infrastructure platform in the cloud comprised of a broad set of compute, storage, database, analytics, application, and deployment services from data center locations in the U.S., Australia, Brazil, China, Germany, Ireland, Japan, and Singapore. More than a million customers, including fast-growing startups, large enterprises, and government agencies across 190 countries, rely on AWS services to innovate quickly, lower IT costs, and scale applications globally. To serve these customers, AWS is committed to operating in the most environmentally friendly way possible. In addition to the environmental benefits inherently associated with running applications in the cloud, AWS has a long-term commitment to achieve 100% renewable energy usage for its global infrastructure footprint. Today, three AWS Regions are 100% carbon-neutral, including US West (Oregon), EU (Frankfurt), and AWS GovCloud (US).
"We've been working closely with Tesla for the past year to drive innovative applications of high-capacity battery technology in data center applications with the ultimate goal of reducing the technical barriers limiting widespread adoption of renewables in the grid," said James Hamilton, Distinguished Engineer at AWS. "Batteries are important for both data center reliability and as enablers for the efficient application of renewable power. They help bridge the gap between intermittent production, from sources like wind, and the data center's constant power demands. We're excited to roll out a 4.8 megawatt hour pilot of Tesla's energy storage batteries in our US West (Northern California) Region. This complements our strategy to use renewable energy to power our global infrastructure."
"As part of Target's support to our communities, we're excited to partner with Tesla on a pilot test at select Target stores to incorporate Tesla Energy Storage as part of our energy strategy," said David Hughes, senior group manager, Energy Management, Target. "Tesla's cutting-edge technology offers unique benefits to powering these stores, most importantly relieving stress from the electrical grid at peak times, furthering Target's investment in designing and operating energy-efficient and sustainable buildings."
Jackson Family Wines
Jackson Family Wines (JFW) is a collection of premium and luxury wineries best known for its acclaimed Kendall-Jackson Winery. Sustainability is intentional at JFW; we have taken a two-fold approach to energy management at our wineries by improving operational efficiency across all levels of our organization and reinvesting those savings in onsite renewable energy systems.
With Tesla's stationary energy storage solution, JFW can significantly mitigate energy use around four areas that account for the most consumption in our winemaking process: refrigeration/cooling, lighting, compressed air and process water treatment. Each battery pack will draw electricity from the grid or our onsite solar arrays during times of low demand and store it for later use to smooth out energy spikes.
EnerNOC's energy intelligence software helps customers make the most of Tesla's energy storage systems by integrating them into an overall energy management strategy. EnerNOC's software easily integrates with any site that has a Tesla energy storage system, optimizing battery usage during high price periods and enabling customers to utilize batteries for demand charge management and demand response.
Tesla Energy for Utility applications
For utility scale systems, 100kWh battery blocks are grouped to scale from 500kWh to 10MWh+. These systems are capable of 2hr or 4hr continuous net discharge power using grid tied bi-directional inverters.
Systems support applications including peak shaving, load shifting and demand response for commercial customers while offering, renewable firming and a variety of grid services at utility scales.
Tesla Utility Storage is designed to:
Firm up renewable generation by reconciling the intermittency of power from these sources and storing excess capacity to dispatch when it's needed.
Increase resource capacity. Utility Storage acts as on-demand distributed power generation, contributing to the overall generating capacity while adding resiliency to the grid.
Ramp Control. Utility Storage can act as a buffer while the power output from a large generation source is ramping up or down, delivering power instantly to smoothly transition output to the required level.
Improve power quality by preventing fluctuations from propagating to downstream loads.
Defer costly and time-consuming infrastructure upgrades.
Manage peak demand by deploying power within seconds or milliseconds.
Utility Projects with Tesla Energy
Advanced Microgrid Solutions (grid resource adequacy)
"Tesla's bold approach to advancing battery technology will change the way we build our cities forever" -Susan Kennedy, co-founder and CEO of Advanced Microgrid Solutions.
Oncor realizes the electric industry is changing as well as our customers' needs for electric service. Oncor believes the only way to prepare for customers' future needs is with a flexible, adaptive electric grid which can only be accomplished through the use of technology like advanced meters, smart grid and electric storage. Tesla has long demonstrated its ability to be a technology leader which is why Oncor has looked to Tesla for grid-scale storage. Oncor looks forward to working with Tesla to make sure the electric grid meets all customers' future needs.
Southern California Edison
Edison International is proud of its efforts to help create a market for battery storage systems and its work with Tesla to bring this technology to customers. Southern California Edison (SCE), the regulated utility subsidiary of Edison International, has developed the nation's largest battery storage system and has contracts in place for an additional 264 megawatts of storage, including projects using Tesla batteries. SCE is working with Tesla on three demonstration projects that can help drive down the cost of battery storage systems for residential and business customers, as well as EV drivers. These demand response demonstration projects will test communication capabilities and explore rebates to customers who allow SCE to manage their battery charging in order to increase the use of renewable energy while ensuring continued grid reliability.
SoCore Energy, a subsidiary of Edison Energy, which is Edison International's portfolio of competitive businesses and equity interests in emerging companies, is working with a client to design and install Tesla batteries at two of their retail properties in Southern California. The sites will feature Tesla battery units that will be charged with electricity from the grid during nonpeak hours at night. The two battery systems will be able to store up to 400 kilowatts and 600 kilowatts, respectively. SoCore Energy is working with its client to identify additional locations for potential battery installations. SoCore Energy is not the same company as Southern California Edison, the utility, and SoCore Energy is not regulated by the California Public Utilities Commission.
AES (solar paired at a utility level)
Tesla Motors' commitment to battery production will help meet the growing demand for energy storage; as a launch partner, we are particularly pleased to leverage the home battery product across our distributed energy platforms. AES has been providing grid-scale energy storage solutions for seven years, building on more than 30 years of experience serving utilities with power solutions that improve lives.The AES Advancion™ digital control system for energy storage manages best-in-class batteries and other components for both centralized and distributed storage systems. In addition, AES' world-class capability in engineering, installation and operations and maintenance enable turnkey energy storage solutions from KWs to hundreds of MW for utilities and end customers.
The AP contributed to this report. This post was updated.