Case against Tesla and battery storage is ‘peak stupid’


Tesla battery storage at a wind farm. Image RenewEconomy

Giles Parkinson, RenewEconomy

It is clearly getting under their skin, this battery storage technology, and its potential as a ‘game changer’ in the energy industry.

We’ve had the politicians mocking Tesla’s big battery as little more than a ‘Big Banana’, and the far right railing against it because it’s not coal, and taking umbrage when the likes of AGL dare suggest a big battery as a possible partial substitute for an old generator like Liddell.

But the case against battery storage has just hit peak stupid.

It came in an article in Australian Financial Review over the weekend, under the authorship of one of its ‘Chanticleer’ columnists, Michael Smith, and supposedly quoting Snowy Hydro CEO Paul Broad and its CFO Gordon Wyler from an interview and a ‘previously unreleased presentation’.

The article makes claims about the cost comparisons of pumped hydro and battery storage are so absurd that it is stunning to think that it could be repeated in a leading business journal, let alone the back-page column that claims to the country’s most authoritative.

The article makes claims about the cost comparisons of pumped hydro and battery storage are so absurd that it is stunning to think that it could be repeated in a leading business journal, let alone the back-page column that claims to the country’s most authoritative.

But such is the state of the energy debate in Australia. It’s not just politicians that are letting consumers down, it’s the media. And it’s hard to know whether the journalists are too lazy, too stupid, or too conflicted to do any different.

Take this paragraph as one example:

‘Snowy estimates five fully charged Tesla Powerwall home batteries provide 70 kilowatt-hours of storage, but this would only last a household 3.5 hours on a hot day if a modern air-conditioning unit was running.’

Now, we know that the energy industry is a complex beast, and it may be that Michael Smith has written little about it and so struggles with some of its finer points, and perhaps he doesn’t live in a house or use air-con.

But we wonder what sort of household air-con unit would actually consume 70kWh in just three hours. Mine – on economy mode – would struggle to consume 2kWh (two) in that time. Queensland homes, nearly all of which have air-con, have average daily consumption of 25kWh.

Those Tesla batteries would power those houses for 3 days at least, even if there wasn’t any sun to recharge them.

And then there was this: Snowy estimates that using pumped hydro as storage would add just $40 a year to household electricity costs, but using battery storage would cause individual household bills to surge by up to $6,000 a year.

Even if Chanticleer had thought about this claim ever so briefly – say for about five seconds – the author might have cottoned on that this was just nonsense.

For a start, anyone facing a four-fold increase in electricity bills to more than $8,000 a year might just as well cut the cord and go off-grid, with battery storage. It would be far cheaper.

The claim that Snowy Hydro could generate the power of 200 million fully charged Powerwalls is also bizarre. To draw such a comparison is to confuse the role of different forms of storage. 200 million Powerwalls is equivalent to 1000GW – about 30 times more than peak load in Australia, and significantly more than Snowy at its peak.

That peak could be met by just 7 million Powerwalls – or one in each Australian home, and the household could make big savings on the cost to consumers of grid power, which Snowy and the AFR seem to completely ignore.

And households don’t need 175 hours of storage – around 6-8 hours is more than enough for most to get through the night, and with a oversized PV system on the roof and sensible load management this can be reduced further

You can’t put a pumped hydro scheme in the attic, but a battery does easily fit on the wall and is already showing consumers save money – as the AFR itself noted in November last year in this story: ‘Tesla’s Powerwall can pay for itself in 6 years

The examples were used to push Broad’s claim that batteries of the scale spoken of in South Australia and elsewhere don’t make ‘any economic sense’ at all. But that is just not true.

The point is, no one is suggesting that batteries are used for all storage. There is quite clearly some uses where battery storage has clear advantages – fast response, network security, short-term time shifting, emergency back-up power, displacing the cost of grid maintenance.

Networks have been putting in battery storage because it is clearly cheaper than upgrading infrastructure, they have been using them in micro-grids to either cut the costs of elongated lines, or to provide the cheapest and surest means of grid security.

They are also starting to compete in markets such as energy and frequency control and ancillary services.

One of the reasons they do not yet compete on an equal footing – and the reason they need some level of support such as Tesla’s big battery – is because the market rules are against them, favouring  comparatively slow moving technologies of the type in Broad’s portfolio – gas peaking plants and pumped hydro.

One way to fix that is to shift the settlement period from 30 minutes to 5 minutes, to recognise the ability of battery storage to respond quickly, and to reduce the gaming that obviously occurs – quite legally, apparently, in the market.

Who have campaigned fiercely against those changes? The big generation companies, and Snowy Hydro among them.

Snowy Hydro has also been active in the market to ensure that it is gaining the maximum price and revenues for its government shareholders.

Read this report from the Australian Energy Regulator, and this story: High energy prices: Blame fossil fuel generators, not renewables, on how government owned Snowy and Origin took advantage of a system constraint, bidding prices down to the point where Victoria generators had to exit the market, before then bidding the prices back up for extended periods.

There is a clear case for pumped hydro, whether it be Snowy 2.0, Tassie 2.0, or the projects like Cultana in South Australia, Genex in Queensland, or the myriad community scale projects.

Storage in Australia’s grid will likely be a mixture of batteries, pumped hydro and solar thermal, and may be others, and these technologies will dovetail  the increasing penetration of wind and solar, and distributed generation.

So why is Snowy running so scared and mounting such a ridiculous campaign against battery storage? Chanticleer  paints Broad as someone who is fighting against ‘vested interests’ and politics, but this nonsense from a government owned utility speaks of exactly that.

But these are strange and curious times. The denial of climate science is one thing, the push for coal another. The argument against battery storage doesn’t add up.

To get this right, we need a reasoned debate. We are not likely to get it from the Murdoch media, which continues to make stuff up about the level of renewable energy subsidies. The AFR, owned by Fairfax, and Snowy Hydro, need to do better than serve up this sort of crap.

(Note: We sought to check with Snowy Hydro on Monday, but the media folk did not return our calls).

This article first appeared in RenewEconomy and is republished with permission.



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