TESLA POWERWALL 2.0 FOR ENERGY STORAGE AND DEMAND REDUCTION

Tesla markets a wall-hung, nominal 14 kWh, available 13.5 kWh, Powerwall 2.0 battery unit, with lithium-ion cells made by Panasonic, either in Japan or Nevada. The unit is designed for daily charging and discharging.

 

Battery system turnkey capital cost = $6,200, factory FOB + S & H + Contractor markup of about 10 percent + Misc. hardware + Installation by 2 electricians, say 16 hours @ $60/h = $8,200, or $586/kWh. 

 

This is a Tesla estimate, which likely would be higher, depending on customer site conditions. The Tesla estimate does not include electrical system upgrades (if necessary), taxes, fees, and grid interface. Here is a schematic drawing of the miscellaneous equipment required for a turnkey system.

http://cdnassets.hw.net/d5/fc/a3926e9a4ec8a8026e9dd8bb3485/0616-jlc...

 

Tesla offers a 10-y warrantee for manufacturing defects, but does NOT cover performance. Tesla estimates a10% degradation in performance by year 10.

 

The unit likely contains enough batteries to store about 20 kWh, so by marketing a unit with an available 13.5 kWh, it likely never gets charged above 95% (charging to 100% is harmful) or discharged below 25% (discharging below 25% is harmful), thereby achieving the warranty 10-year life, 3600 cycles, likely with less than 10% degradation.

http://www.batteryuniversity.com/learn/article/how_to_prolong_lithi...

 

Example No. 1, Store Daytime PV Solar Energy for Use During Peak Hours at Night: 

 

The economics of this scheme is based on the unrealistic assumption PV solar energy would be available to completely charge the battery units to the maximum extent possible, each and every day, for 10 years, and that all of that energy would be used at night. Weather conditions allow for very little generation of solar energy on many days, as proven in Germany, with similar weather conditions as New England.

 

In reality, a 5 KW solar system would produce about 6250 kWh/y, or about 17 kWh/d, on average, in New England, more in summer, much less in winter. The best summer month has about 4 times the production of the worst winter month; the ratio is about 6 to 1 in southern Germany.

 

Adequate solar energy would be available to charge the units on many days during summer, but the energy would be inadequate on many days during winter. Any shortfalls required to top off the units would need to be supplied by the grid, so the units could be used for standby power in case of an outage.

 

Other Assumptions: 1) No performance loss over the 10-y warrantee life; 2) One cycle per day, i.e., 3,650 cycles in 10 years; 3) Utility has time-of-day charges; 4) Homeowner could have sold daytime solar energy to the utility at 20 c/kWh; 5) Homeowner avoids buying peak hour grid energy (about 5 to 8 pm) from the utility at 30 c/kWh.

 

A quick way to estimate the minimum cost of storage: $8,200, turnkey cost/3650 cycles = $2.247/d. Dividing by AC to user 2.247/12.758 = 0.176 $/kWh. Minimum loss over 10 years = 8200.00 - 3489.21 = $4710.79

 

Ignored items: Financing and amortizing; 2) Return on investment; 3) Cash grants, tax credits and accelerated depreciation; 4) O&M and disposal; 5) Battery capacity degrading over time due to cycling; 6) PV panels degrading over time; 7) Efficiency reductions of frequent low-load operation of inverters; 8) Battery and inverter replacement about every 10 years; 9) PV panel replacement by about year 25.

 

Conclusion: Storing solar energy during midday to retrieve less energy during peak hours at night is not smart, unless the rate differential and subsidies are extremely high.

 

NOTE: For people living "off-the-grid", it is essential to store solar energy during midday for use at night.

 

https://www.solarquotes.com.au/blog/powerwall-2-warranty/

https://www.tesla.com/powerwall

 

Store day solar, use at night

Powerwall 2.0, 14 kWh nominal, 13.5 kWh actual

 

kWh

$

14.913

DC from PV system, kWh

6200

Tesla FOB, $

0.960

Inverter eff., DC to AC

2000

Installation, $

14.316

AC to grid

8200

Turnkey, $

0.943

2.0 unit eff., AC to AC

13.500

DC stored

0.943

2.0 unit eff., DC to AC

12.731

AC out to user, kWh

2.182

Loss per cycle, kWh

3650

Cycles/10y

0.20

Charging cost, $/kWh

2.247

Storage cost, $/d

0.30

Avoided cost, $/kWh

0.176

Storage cost, $/kWh

0.96

Gain, $/d

3489.21

Gain, $/10y

4710.79

Loss, $

 

Example No. 2, Store Nighttime Grid Energy for Use During Peak Hours at Night:

 

Assumptions: 1) No performance loss over the 10-y warrantee life; 2) One cycle per day, i.e., 3,650 cycles in 10 years; 3) Utility has time-of-day charges; 3) Off peak energy is charged into the battery unit at 20 c/kWh; 4) Homeowner avoids buying peak hour grid energy (about 5 to 8 pm) from the utility at 30 c/kWh.

 

A quick way to estimate the minimum cost of storage: $8,200, turnkey cost/3650 cycles = $2.247/d. Dividing by AC to grid or user 2.247/12.731 = 0.176 $/kWh. Minimum loss over 10 years = 8200.00 - 3489.21 = $4710.79

 

Ignored items: Financing and amortizing; 2) Return on investment; 3) Cash grants, tax credits and accelerated depreciation; 4) O&M and disposal; 5) Battery capacity degrading over time due to cycling; 6) PV panels degrading over time; 7) Efficiency reductions of frequent low-load operation of inverters; 8) Battery and inverter replacement about every 10 years; 9) PV panel replacement by about year 25.

 

Conclusion: Storing grid energy at night to retrieve less energy during peak hours at night is not smart, unless the rate differential and subsidies are extremely high.

 

Charge at night, use during peak nighttime hours.

Powerwall 2.0, 14 kWh nominal, 13.5 kWh actual.

 

kWh

$

14.316

AC from grid

6200

Tesla FOB, $

0.943

2.0 unit eff., AC to DC

2000

Installation, $

13.500

DC stored

8200

Turnkey, $

0.943

2.0 unit eff., DC to AC

12.731

AC to grid or user

1.586

AC loss per cycle

0.89

Efficiency AC to AC

3650

Cycles

0.20

Charging cost, $/kWh

2.247

Storage cost, $/d

0.30

Avoided cost, $/kWh

0.176

Storage cost, $/kWh

0.96

Gain, $/d

3489.21

Gain, $/10y

4710.79

Loss, $

POWERWALL 2.0 AS BACKUP DURING POWER OUTAGES, WITH GMP

 

Forward Capacity and Transmission Charges: GMP, a Vermont utility, is distributing two thousand Powerwall 2.0 units on its distribution grids to reduce peak demands, which would reduce its ISO-NE-imposed forward capacity charges and forward transmission charges. The units deliver continuous power at 5 kW and peak power at 7 kW.

 

The turnkey capital cost would be about $17 million - ($5.1 million, 30% ITC, + $4.25 million, 5-y accelerated depreciation, equivalent to a 25% cash grant) = $7.65 million. The ITC will become 10% in 2022.

https://www.solarpowerworldonline.com/2015/12/solar-itc-officially-...

 

Two thousand units would reduce GMP peak demand by at least 10 MW, which would reduce GMP forward demand charges by about $1 million/y, and would reduce forward transmission charges by about $1 million/y in 2015 - 2016. More in future years, as the forward charges are due to increase.

 

This demand reduction approach has a simple payback of 17/2 = 8.5 years without subsidies, or 7.65/2 = 3.8 years with subsidies. As the Powerwall 2.0 unit is guaranteed for 10 years, the subsidies are vital “to make the numbers work”. See URL and table.

http://www.windtaskforce.org/profiles/blogs/solar-energy-does-not-r...

 

ISO-NE measures GMP’s peak demand once per year for determining the GMP forward capacity charge for that year.

ISO-NE measures GMP’s peak demand once per month for determining the GMP forward transmission charge for that month.

See URL for explanation of forward charges.

 

http://www.ncsl.org/Portals/1/Documents/energy/energy_Todd_Olinsky_...

http://mashable.com/2017/05/16/tesla-green-mountain-power/ - t6FhJf...

http://www.windtaskforce.org/profiles/blogs/solar-energy-does-not-r...

 

Year

 ISO- NE Forward Capacity Charge

 

$/kW-month

2010 - 2011

 4.254

2011 - 2012

3.119

2012 - 2013

2.535

2013 - 2014

2.516

2014 - 2015

2.855

2015 - 2016

3.129

2016 - 2017

3.150

2017 - 2018

7.025

2018 - 2019

9.551

 

GMP Increasing its Asset Base: GMP prefers to own/lease the units (made in Nevada), and own/lease heat pumps (made in Japan), and own/lease PV panels (made in China with dirty coal plants or in the US), because that adds to GMP’s asset base on which it is allowed to earn 9% per year, and helps GMP collect cash grants, tax credits, subsidies, etc., and have fast write offs, to minimize paying taxes and increase its net profit.

 

Other taxpayers and ratepayers have to provide the cash grants, tax credits, subsidies, etc., and make up for the taxes GMP avoids, one way or another; good for GMP, bad for ratepayers and taxpayers. No wonder GMP is so pro RE.

 

Customer Cost and Benefit: GMP offers to install a battery unit (or multiple units) at a customer for a monthly charge of $15/unit, or a one-time charge of $1500/unit. GMP would have the right to remotely discharge the unit one time per day for 10 years (usually during peak demand hours, about 5 to 8 pm). In case of a power outage, a homeowner customer would have about 24 hours of standby power, provided GMP had not earlier discharged the unit for its own purposes.

 

GMP direct investment would be 2000 units x $8200/unit = $16.4 million, plus GMP costs of getting the program up and running. GMP likely prepared spreadsheets of the financial economics of the project, but those are not shared with the public, despite the public providing various financial benefits that improve the return on investment. The public likely will be told the heavily subsidized project will pay in 5 or 6 years, but proof of that likely will be withheld.

 

A Much Less Costly Approach: It would be much less costly for GMP and the Vermont economy, to turn on several quick-starting, diesel-generator sets during those peak demand hours, as GMP has been doing for decades. A standard, 1 MW, quick starting, D-G set has a turnkey cost of about $0.7 million.

 

Even better would be a quick starting, gas or No. 2 fuel oil-fired, open cycle gas turbine, such as Siemens model SGT-A45TR, 44 MW, about 40% efficient, turnkey capital cost about $30 million.

 

- The OCGT would reduce peak demand by 44 MW, which is much more than the 10 MW of 2000 Powerwall 2.0 units. 

- The OCGT would last about 40 years, the battery units about 10 years, per Tesla. 

- To compare apples to apples of 40 years, about 4.4 x $16.4 = $72.2 million would be required to have 8800 battery units provide 44 MW of demand reduction, PLUS those 8800 units would need to be replaced 3 times during the project life of 40 years, at a cost of at least 3 x 50 million = $150 million, for a total cost of 72.2 + 150 = $222.2 million. 

 

Summary:

- The GMP battery approach is much more expensive than DG sets and gas turbines.

- GMP prefers its battery approach, because a 9% profit on their high capital cost is good for GMP, but bad for ratepayers, etc.

- For the same reason, GMP also does not want to buy low-cost, clean, near-zero-CO2 energy from Hydro Quebec, as it would not add to its assets base; good for GMP, but bad for ratepayers, etc.

- It appears, for GMP, is all about the money and it has nothing to do with saving the world, because its battery approach has far more CO2 emissions than buying energy from H-Q.

 

Conclusion: The economics of D-G sets and OCGTs is far better than of GMP’s battery approach. GMP continuing to fiddle with heavily subsidized "microgrids and islanding and PV solar/ battery systems combos”, claiming it is the future, would be very expensive for ratepayers and taxpayers and the competitiveness of the Vermont economy. 

 

Scott’s 21-Member Climate Group: GMP personnel, and a supplier to Tesla and GMP, are part of Governor Scott’s 21-member climate group; the members recommended each other so it would be biased with pro RE people. It looks like there will be many more of those expensive battery “solutions”. 

 

Scott is aiming to make the Vermont economy more competitive, but GMP's battery approach definitely is a major step backwards for already-struggling Vermont households and businesses and the Vermont economy.

 

Most people do not have the slightest inkling how to figure that out, because of the barrage of pro-RE press releases that to energy systems analysts are mostly fake news.

https://vtdigger.org/2017/07/20/scotts-new-climate-group-aims-cut-c...

 

NOTE: On July 24, 2017, our household, served by GMP, had a power outage at about 9 pm. It lasted about 5 hours. If we had had a Powerwall 2.0 unit, it would have been empty.

 

POWERWALL 2.0 AS BACKUP DURING POWER OUTAGES, WITHOUT GMP

 

If a Powerwall 2.0 were used for backup, it would need to have sufficient capacity to provide energy, kWh, during an outage, which could last up to 36 hours. For a freestanding house, using about 500 kWh per month, this may be up to 12 kWh, assuming some appliances remain turned off during the outage. That means one unit would be adequate. The turnkey cost to the homeowner would be about $8,200. The homeowner owns and has complete control over the unit.

 

However, almost all homeowners have figured out that it is much more cost-effective to have a 3 - 5 kW, propane-fired generator with a standard 100-gallon tank, and a 1 kWh, battery-based, uninterruptible power supply unit, to provide power during startup of the generator. The turnkey cost to the homeowner would be about $1000.

 

There is a small hitch developing on the horizon, because the 100% pro-RE folks, almost all starry-eyed, lay people, likely aided by GMP, et al., are aiming to outlaw propane and gas in Vermont, New Hampshire and elsewhere, so the GMP battery approach would have a monopoly.

 

That approach is about as dumb as closing down Vermont Yankee, a highly reliable, 620 MW nuclear power plant, with a 0.92 capacity factor, producing near-CO2-free, low-cost electricity, over 500-day refueling periods.

 

PV SOLAR SONNEN COMBO LOW-INCOME HOUSING DEMONSTRATION PROJECT

 

The $3.67 million demonstration, low-income housing development, with 7 pre-fabricated duplex units for 14 tenants, is located in Waltham, Vermont. Numerous government and private entities made cash grants to the development to make it a success. See URL for additional information and analyses.

http://www.windtaskforce.org/profiles/blogs/pv-solar-sonnen-combo-l...

 

COMPARISON OF RECENT BATTERY SYSTEM TURNKEY CAPITAL COSTS

 

The turnkey capital cost of battery systems has been decreasing the past few years. The below URL has capital costs/kWh of some 2016 and 2017 projects.

http://www.windtaskforce.org/profiles/blogs/comparison-of-recent-ba...

 

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