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Tesla has won a contract with Southern California Edison for the installation of what will be the biggest lithium-ion battery storage facility in the world. The project, featuring Tesla’s Powerpack system, will have a capacity of 20 MW/80 MWh and will be capable of supplying power to 2,500 households for a day or charging 1,000 Tesla cars, the company said.
The batteries for the Powerpack will be manufactured at Tesla’s recently completed gigafactory in Nevada, which will allow the company to put the storage facility in operation within three months. Once online, the system will store energy taken from the grid during off-peak hours and then release it during peak hours whenever the grid can’t cope due to increased demand for energy in the winter months.
The energy storage project was tabled after a huge leak of natural gas from the Aliso Canyon reservoir, which resulted in the release of as much as 1.6 million pounds of methane into the atmosphere and displaced thousands of people.
The Aliso Canyon reservoir was closed to avoid future disasters, which left the gas peaker power plants around Los Angeles short of the gas they would need to meet energy demand in winter. Now, with Tesla’s storage system, energy produced outside the periods of peak demand will be used during future peaks.
An additional advantage of the Powerpack solution, Tesla points out, is that storing energy and then using it when demand is heightened will also help decrease CO2 emissions from the generation of electricity at gas-fired power plants.
Although Tesla did not disclose the size of the deal, the company’s website says a 2 MW/4 MWh Powerpack system costs around US$2.22 million.
The contract is certainly very good news for the carmaker, which this year has been plagued by serious problems with its autopilot system, missed production targets, and missed sales targets. The Southern California Edison contract is also the latest indication of Tesla’s dedication to expanding into a one-stop-shop for energy solutions, following its August acquisition of SolarCity.
By Irina Slav for Oilprice.com
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Irina is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing on the oil and gas industry.