Speaking at the Edison Electric Institute conference recently, Tesla CEO Elon Musk told utility company executives they have nothing to fear from Tesla batteries entering the utility scale electric storage market. Among other reasons, he told them the demand for his electric cars will increase demand for their electricity.
Musk is on record as being a champion of renewable energy. He passionately believes that the Earth is slowly being poisoned by carbon gas emissions and the only way to save it is to stop burning fossil fuels. The problem with renewables like solar and wind power, though, is that the sun is not always shining and the wind is not always blowing. Until recently, there was no way to economically store electricity for use later.
But the rechargeable lithium ion battery has changed all that. Not only does it make electric cars and residential solar systems possible, it also allows utility companies to make electricity during off peak hours and store it for when demand increases.
Once that happens, the utilities can save vast amounts of money because they dont need to build new power plants and can even close some of their most inefficient existing and high emissions facilities. Not only is grid storage good for the environment, its good for business, too.
Speaking at the Tesla annual shareholders meeting this month, Musk told the audience that he expects 80% of the companys stationary battery business to be utility scale storage units. Tesla plans to install 1 gigawatt of storage capacity in the coming year. Musk says the Gigafactory being built in Nevada will have the ability to produce about 15 gigawatts of storage in addition to the batteries needed by the automotive side of the business.
He said utilities like the fact that the Tesla units are smaller than their competitors, which allows them to be installed within the footprint of existing substations. That eliminates the need for land acquisition and obtaining construction permits. He also said utilities are just like private customers. They appreciate that the Tesla products are plug and play capable and can be installed with no headaches or hassles.
Annual global investment for energy storage is expected to more than triple from $800 million in 2014 to $5.1 billion in 2020, according to a New Energy Finance report last year. Tesla expects to supply a large part of that business.
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