Tesla plans world’s largest lithium-ion battery project

Source: Christa Marshall, E&E reporter • Posted: Thursday, September 22, 2016

Electric vehicle giant Tesla yesterday announced it will deploy the largest lithium-ion battery project in the world to back up power in California.

The 80-megawatt-hour system of Tesla Powerpacks is being tapped to fill a power gap in Los Angeles after the Aliso Canyon natural gas disaster, the worst natural gas leak in U.S. history.

After the incident, the California Public Utilities Commission directed utilities to solicit utility-scale storage options quickly to ensure there would be enough power during peak demand to avoid blackouts. The directive called for storage solutions to be operational by the end of December. After the disaster, the Alison Canyon facility was deemed unfit to store fuel safely to supply natural gas peaker plants in the Los Angeles area.

Southern California Edison selected the Tesla system for its Mira Loma substation.

Tesla plans to manufacture and install the batteries within three months at its Gigafactory in Nevada. The Powerpacks will hold enough power to service 2,500 homes for a day, according to the company.

“The system will charge using electricity from the grid during off-peak hours and then deliver electricity during peak hours to help maintain reliable operation of Southern California Edison’s electrical infrastructure,” Tesla said in a statement. “By doing so, the Tesla Powerpack system will reduce the need for electricity generated by natural gas.”

The system is just one of several storage options being tapped by utilities in California (EnergyWire, Sept. 16).

Yayoi Sekine, an analyst at Bloomberg New Energy Finance, said it’s the biggest energy storage contract ever for Tesla. “What’s most exciting, though, is that large utility scale projects are going to be built in less than four months — this is a big deal for energy storage everywhere.” In California, previous utility procurements expected projects to be delivered about three years after the contract date, Sekine said.

Tesla launched its Powerwall batteries and larger Powerpack last year. Since then, CEO Elon Musk has been vocal about plans to transform Tesla into a sustainable energy company that provides power and renewable solutions for homes and businesses, along with electric cars. Some analysts have praised the move, while others argue it is diverting Tesla from its core business.

The company plans to produce more lithium-ion batteries at its Gigafactory by decade’s end than were produced globally in 2013.

The storage industry reported this month that there is growing interest in grid-scale storage options around the country. Earlier this year, the 15-state Midcontinent Independent System Operator installed its first-ever grid-scale battery system (Greenwire, Sept. 7). There are other planned projects, including one from AES Corp., that are slated to surpass the California Tesla project in scale and output.