World’s Biggest Battery Built By Tesla Saves Australian Region $40 Million In First Year


In December last year, Tesla lived up to its promise and installed a giant lithium-ion battery in South Australia – an area that had been plagued by power outages and blackouts.

Elon Musk had stated that, with his company’s massive 100 MWh battery, Tesla could solve the region’s power problems and supply energy to tens of thousands of homes at a fraction of the cost of the system in place at the time.

An array of batteries were installed on a wind farm near Jamestown, in South Australia’s Mid North region. Tesla’s batteries are charged with power from the wind farm, and their output provides stability to the power grid.

Before the installation, Mike Cannon-Brookes – co-founder and co-CEO of software company Atlassian, and a staunch campaigner for renewable energy – tweeted Elon Musk about the proposed project.

He said:

How serious are you about this bet? If I can make the $ happen (& politics), can you guarantee the 100MW in 100 days?

To which Elon Musk replied:

Tesla will get the system installed and working 100 days from contract signature or it is free. That serious enough for you?

After working out the contracts, Tesla embarked on the ambitious project, known as the Hornsdale Power Reserve (HPR).

In a blog post, the company wrote:

Upon completion by December 2017, this system will be the largest lithium-ion battery storage project in the world and will provide enough power for more than 30,000 homes, approximately equal to the amount of homes that lost power during the blackout period.

[…] this grid scale energy storage project is not only sustainable, but will help solve power shortages, reduce intermittencies, and manage summertime peak load to improve the reliability of South Australia’s electrical infrastructure.

One year since the completion of the project, Aurecon – an engineering and infrastructure advisory company – have carried out a report of the Tesla batteries, to examine how its new methods of supplying energy have transformed the current system.

They wrote:

Aurecon’s independent report found the system – owned by Neoen and supplied by Tesla – delivered all project objectives, reduced volatility on the state-wide network over the 12-month period and contributed to a reduction of close to $40 million in the frequency control ancillary services (FCAS) market.

The installation of the batteries – the world’s largest lithium-ion battery storage project – cost Tesla $66 million. Which means, in less than two years, the project will have effectively paid for itself.

The Tesla batteries supply the South Australian region the same energy service as before, but quicker, more reliably, and with zero emissions.

Paul Gleeson, Aurecon’s Energy Leader, said:

HPR is a game changer for the energy sector and has demonstrated some of the new capabilities we need in the electricity network to successfully integrate greater proportions of renewables.

What has been done here by the SA government, Neoen and Tesla is the type of innovative and forward-thinking approach that we are going to need more of in the years ahead.

As the success of Tesla’s batteries continues, Aurecon also believe the benefits could include improved energy stability, as well as a reduction in wholesale prices.

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