Tesla battery is an energy game changer


Tesla Motors CE Elon Musk speaks during the unveiling of the company's 'Powerwall' in Hawthorne, California, the US, on April 30. He says a greener power grid furthers the company's mission to provide pollution-free energy. Picture: BLOOMBERG/TIM RUE
South African-born entrepreneur and inventor Elon Musk is one of the key players behind the seismic shift in the electricity industry. Picture: BLOOMBERG/TIM RUE


SINCE the announcement of the Tesla battery, enthusiasts and sceptics have had a chance to chew over the figures and claims. The consensus seems to be that it matches anything we’ve got and may be better.

The sceptics argue that at a cost of $3,000 it is a very expensive way of storing a few dollars’ worth of electricity. Another sceptic, who also manufactures lithium-ion batteries, says electricity is cheap and putting cheap electricity into a Tesla battery is like keeping potatoes in a safe.

The enthusiasts say they are shocked by the low cost of the battery and that they had expected it to cost two or three times as much.

Where the Tesla battery scores is its small size, its 10-year guarantee (and another 10 years on extended warranty) and that it requires virtually no maintenance.

There is no reason to rush out and buy solar panels, a Tesla battery and plan a life of off-grid living yet. But something very important has happened.

The cost of battery storage has been coming down steadily and the prediction was that by 2020 it would be viable. Tesla got there five years ahead of the field and this lead will give it huge commercial advantages.

It is a credible product with major US companies such as Amazon and Target already using the batteries.

Apple, Google and retail giant Walmart have invested heavily in solar power and the Tesla battery will add value to the panels on their roofs — which makes investment sense to them.

The secondary effect will be a huge boost for the solar-panel industry, and we can expect competition that will produce more efficient panels and better prices. That, in turn, will increase the demand for batteries. And the batteries will get better and cheaper too.

Lithium-ion technology can also expect plenty of competition for there is a great deal of research on “flow batteries”. They use various liquid electrolytes and, while they may not pack the punch of the lithium-ion battery, they have other advantages such as cost and long life.

They will be rather bulky, but that will not be a problem for wind and solar farms and some industrial users.

There are also sea-salt batteries, molten-salt batteries and many other types in development. Some of them will be successful and will find their place in our electrified world. Fuel cells will also definitely be part of our energy future.

What the Tesla battery has done is prove the viability of battery storage and blaze a path for others to follow. It will add new urgency to research work and you can bet that deadlines and efficiency goals are already being revised.

THE other surprise in the Tesla announcement is that it is already making big batteries for utility companies to store peaking power and to use when the input from the wind and solar farms falls off. Change is speeding up and we must now start asking hard questions about electricity grids.

The most enthusiastic battery fan was probably Arnie Gunderson, a former nuclear scientist who is now an antinuclear activist.

He says the Tesla battery marks the death of the nuclear-power industry.

The nuclear industry’s last argument, he says, is that it is the only way to produce carbon-free base-load electricity 24 hours a day. Now, the combination of solar power and the Tesla battery could do that job — and do it cheaper than any new nuclear-power station.

The UK government has signed a contract for a new nuclear-power station at Hinckley Point in Somerset that will deliver its first power in 2023. The deal is not an agreement to buy a nuclear power station but to buy its electricity at a set price of £92.50 a megawatt hour. That’s about R1.60 a unit.

SA’s Department of Energy has agreed to buy solar power on the same basis from independent power producers (IPPs).

The best bid from a solar IPP is roughly half the price of the nuclear electricity from Hinckley Point.

The main criticism of the nuclear industry over the years has been its radioactive waste, but there was a belief that smart scientists would be able to solve the problem.

Gunderson has this to say on that point: “We all know that the wind doesn’t blow consistently and the sun doesn’t shine every day — but the nuclear industry would have you believe that mankind is smart enough to develop techniques to store nuclear waste for a quarter of a million years, but so dumb that we can’t figure out a way to store solar electricity overnight.”

He believes Tesla has cracked the problem. Maybe. What cannot be denied is that the price of renewable energy and battery storage has been dropping over the past decade and that the line on the graph will continue downward.

At the same time the price of grid electricity goes up every year and will continue to do so as the cost of fuel, wages and transport increases. We have probably reached the point where the lines on the graph are crossing.

The obvious conclusion is that Gunderson is right.

It is insane to invest in a technology that is getting more expensive when the alternative is getting better and cheaper.

There are three other things we need to know about the Tesla battery. The company is building a huge “gigafactory” in Reno, Nevada, that will produce more lithium-ion batteries than the output of all the other factories in the world. And its batteries will be cheaper.

Tesla took $800m in orders in the week after the announcement and it seems a second factory will be needed to meet demand.

Second, Tesla’s sister company, Solar City, is building a huge factory in Buffalo, New York, that will produce photovoltaic panels that are a third more efficient than standard panels.

And third, the men behind this seismic shift in the electricity industry are mainly former South Africans — Elon Musk and his two Solar City cousins from Pretoria, Lynden and Peter Rive. Some of the technology they are working with was developed by Dr Michael Thackeray and his battery research team at the Council for Scientific and Industrial Research in Pretoria.

And our president wants to buy nuclear power stations from Russia!

• Haylett is chairman of the Cape Chamber of Commerce and Industry’s industrial focus portfolio committee.

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