Will Tesla’s battery prompt an energy system revolution?

Electric car firm Tesla Motors, headed by dynamic chief executive Elon Musk, created a wave among the national and international press with the launch of its range of electricity storage batteries for homes, businesses and utilities, which not only has the energy sector talking, but much of the general public as well.

Sensationalism aside, could this new technology be what is needed to provide a much-needed push towards whole-system integration?

Musk said the company’s endgame is “complete transformation of the entire energy infrastructure of the world”, and, since the news broke, the Twittersphere has been full bold declarations about how “Tesla is killing nuclear and fossil fuels”.

Professor of energy policy at Exeter University Catherine Mitchell goes so far as to describe the technology, or rather the potential for competitive energy storage generally, as “another nail in the coffin of conventional utilities”. In a recent statement she warns that, as decentralised energy systems based on renewable energy and demand management become more and more attractive, the need for effective energy storage increases.

“The question is no longer whether decentralisation will happen within the energy system, but when the tipping point will be,” she says. “Increasingly we are seeing a move away from big, centralised power infrastructure towards a decentralised system in which interconnectors and smarter, more flexible distribution grids play a bigger role.”

So far, obtaining details of a version of the Powerwall for utilities has been like drawing blood from a stone, although Tesla says utility-scale batteries will be available which will consist of 100 kWh blocks that can be grouped to a scale of 500 kWh to more than 10 MWh. To avoid being ousted, then, the only option for conventional utilities is to adapt to a low-carbon future.

At a recent seminar at Utility Week Live, Mott MacDonald’s group strategic development manager Simon Harrison made a compelling case for a system architect, who would have “whole-system responsibility” around protocols and standards guidelines, and would create the “resilience and flexibility” in response to the “very fast-moving environment we’re in”.

Director of the Institute for Sustainability at Newcastle University, Phil Taylor, says a systems architect has “the potential to offer much needed leadership through independent, transparent design and decision making to take us forward through the low-carbon transition”.

National Grid must “understand the impact [of the technology] at a whole system level” to avoid “unwelcome and costly” outcomes, Chiltern Power director John Scott warns.

He tells Utility Week that if 5 per cent of UK households bought a Powerwall battery, had a time-of-use tariff that saw a national low price for energy, and instructed their home storage to start charging, “it could create a 3 GW load step that would shut down the National Grid”. This, Harrison says, is “the sort of thing that brings governments down and even causes riots”.

Scott suggests that the networks are unlikely to be developers of storage systems themselves. “However, they may engage at a larger scale, with battery systems connected to the networks at higher voltages,” he adds.

Harrison tells Utility Week that the batteries could be a way for a network company to “avoid having to increase network capacity”, therefore “deferring or avoiding investment”. He also suggests that, unless this technology can be linked to benefits for network companies, the advantages to consumers of being able to store electricity would be “marginal”.

“It will be interesting to see how these batteries are marketed over the longer term – and how consumers make use of their potential to reduce electricity costs,” he says. “For example, in theory, people could opt for an Economy 7 Electricity tariff and then use the battery to store the electricity in order to access it during the day, when electricity prices are typically more expensive. However with present day differentials of around 9p/kWh payback would be marginal, unless it could be linked to other benefits, for example for network companies.”

The Energy Networks Association (ENA) notes that “challenges and innovation” in the distribution networks will “undoubtedly be required to facilitate a low-carbon transition”, but points out that “network operators are already trialling larger-scale battery storage technology to help accommodate increased renewable energy and shifting demand patterns over the coming years.”

Harrison advises the energy industry and government to build new ways of modelling the “phenomena that are going to emerge in this changed world”.

The need for whole-system integration is clear. Now that the general election is over and we have governmental certainty for the next five years, will the announcement of Tesla’s Powerwall battery help set in motion the implementation of a system architect?

“Let’s get the agreement on what the problem is and what the solutions need to look like,” says Harrison. “Then maybe the institutional form can follow.”