Elon Musk made the announcement in Adelaide alongside SA premier Jay Weatherill © AAP/PA Images
Elon Musk made the announcement in Adelaide alongside SA premier Jay Weatherill © AAP/PA Images

Tesla wins contract to build world's largest battery system

10 July 2017

Elon Musk’s Tesla has won a tender to build what he says will be the world’s largest battery system to support South Australia’s (SA) blackout-plagued power grid.

Speaking at a press conference in Adelaide alongside SA premier Jay Weatherill, billionaire Musk said the project would be a litmus test for the reliability of large-scale renewable energy.

“We’re talking about something that’s three times as powerful as the next biggest battery installation in the world,” he said.

“I do see this as something that the world will look at as an example of being able to do large-scale battery applications for the grid that really take a large amount of load.”

In September last year, amid one of the most severe storms for half a century, a state-wide blackout plunged 1.7m residents of SA into darkness and raised questions about how to improve the region’s electrical infrastructure. 

In March, Musk weighed in on the issue on Twitter, promising to build the energy storage system and get it working within 100 days of a contract being signed – or Tesla would provide it free.

Tesla’s bid beat more than 90 other proposals, according to the SA government.

Musk said that failing to deliver the project in time would cost his company around US$50m, although the details of the contract have not been revealed. 

“There will be a lot of people that will look at this—‘Did they get it done within 100 days? Did it work?’,” he said.

“We are going to make sure it does.”

SA has shut down its coal-fired power stations over the last three years, and instead relies on wind power, which supplies 40% of its energy, solar and gas, according to the SA government.

Tesla said the facility would provide 100MW of battery storage by 1 December and it would get electricity from French energy company Neoen’s Hornsdale Wind Farm. It will deliver electricity during peak hours to South Australia’s grid and could power 30,000 homes.

Musk added that the battery facility would be more than three times the size of the previous record holder— a 20MW installation Tesla delivered in California within three months, which can power 2,500 homes for a day. 

Weatherill said the deal formed a key part of the government’s $550m energy plan, which includes a $150m state-based renewable technology fund, a $360m government-owned gas-fired power plant and introducing new ministerial powers to direct the energy market incase of shorfall. 

“It will completely transform the way in which renewable energy is stored and stabilise the South Australian network, as well as putting downward pressure of prices,” he said.

“Battery storage is the future of our national energy market and the eyes of the world will be following our leadership in this space.”

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