Tesla’s iPhone Moment — How the Powerwall will Change Global Energy Use

The Tesla battery that Elon Musk announced gets much media attention, and rightly so. The Powerwall, as the Tesla battery is called, can store energy from renewable sources from solar panels and wind turbines to supplement energy needs and reduce the electrical bill. Said Musk, “Our goal is to fundamentally change the way the world uses energy.” This is a noble endeavor at a time when humanity draws more resources than our mother earth can give.

The Tesla battery stores energy during peak production when output is in over-supply to bridge the gap when free energy goes to rest. The Powerwall also softens peak consumption when the AC grid is stressed to the breaking point.

Environmentally-conscious Germany, Japan and other countries have been using solar panels for many years to reduce energy cost. In parts of Africa where the AC grid is not sufficiently developed to support all household activities, solar panels with battery backup are mandatory. Installing a solar system in energy-rich North America builds an image of being energy savvy rather than doing it for purely economic and environmental reasons. This is evident when spotting a fleet of gas-guzzling cars in the driveway, each with an engine producing 150kW of power to drive to the store and to work.

Renewable energy makes economic sense, but it is expensive. The Western World is served with cheap and reliable electricity from the AC grid with a per kilowatt-hour cost as low as US $0.06 in parts of Canada, to $0.15 in many cities and up to $0.40 in some European countries. Meanwhile, electricity produced by a solar panel comes at about $0.20 per kWh. When including peripheral expenses, solar power is more expensive than buying electricity from the utilities in most parts of the world.

In spite of the apparent higher cost of renewable energy, putting solar panels on houses is becoming fashionable. The cost of the hardware has fallen, so is the installation. The most common photovoltaic (PV) solar cells are the crystalline silicon type with an efficiency of about 20 percent. In comparison, flexible panels have an efficiency of only about 10 percent. The hardware cost to generate one watt of electricity with solid panels is $2.00–2.50 with trend to go lower.

In solar-rich states and countries such as California, Arizona, Hawaii, Japan, as well as in Germany where electricity is expensive and solar subsidized, energy from solar panels is being fed back to the AC grid. This can cause the electrical meter to spin backwards, offsetting previously consumed energy, but it can also induce a problem. The amount of power generated cannot exceed consumption. Dumping more energy into the grid than consumed makes the system unstable, resulting in voltage fluctuations which can overload the circuit and lead to brownouts.

Renewable energy has friends and foes. On one side, governments hand out subsidies to install renewable energy systems while utilities on the other side desperately try to stem the move of home electricity generation by reducing incentives, adding fees or pushing home solar companies out of business. Solar companies fight back through regulators, lawmakers and the courts. The utilities argue that spurious energy production by homeowners complicates control and cuts into the revenue stream. They see it as creating glut or famine by means of excess supply during times of plenty and a failing grade when renewable contributions nose-dive while demand is high.

The conflict is understandable because utility companies are responsible for providing a stable energy supply when renewable resources are absent. Nor are independent energy producers able provide a dependable solution to an aging grid that moans during peak demand. Right or wrong, producing clean energy from a renewable resource should never be curtailed, especially if the resource can be stored.

Storing electrical energy is not new but no system has emerged that is fully satisfactory. One of the most effective storage media for large hydroelectric power stations is to pump water back up to the reservoir during low electrical demand and make it available during peak times. With an efficiency factor of 70–85 percent, pumped hydro is easier to manage than adjusting the generators to satisfy fluctuating power need. Flywheels also serve as energy storage. Large electric motors spin one-ton flywheels when excess energy is available to fill brief energy deficiencies stabilizing the grid. Pumping compressed air into large underground cavities is another way to store energy but for small to medium installations, batteries work best.

Storage batteries have mostly been lead acid and users complain about their short life span. This is in part caused by excessive cycling as the battery charges during the day and discharges at night. Lead acid is ill-suited for deep-cycling and this causes excessive wear and a short service life.

Another problem is sulfation that builds up when lead acid is not fully charged periodically. A fully saturated charge takes up to 16 hours and no solar system can deliver energy for this long. In addition, electrical consumption tends to increases with time while the solar panels reduce their output due to dirt buildup and aging. This often leaves lead acid with insufficient charge.

The Tesla battery solves this in part by using lithium-ion batteries that are more resistant to cycling than lead acid. In addition, Li-ion does not need to be fully charged; in fact a partial charge is better as it relieves stress. However, Li-ion is more expensive than lead acid and Elon Musk cracks this with a mass-market solution by offering a modular household product that suits a broad user base.

The Tesla battery stores 7 or 10kWh of energy, enough to keep a home lit and entertainment served for several hours a day. The battery’s power limit of 2kW is sufficient to simultaneously run a fridge, brown  toast and perhaps iron the shirts and but it is not ample enough to cook a meal on an electric stove, run the dryer or keep the air conditioner going. Any of these high-energy appliances consumes many times the 2kW limit that the Tesla battery provides. During peak household activity, the AC grid will kick in seamlessly to fill the gap. The Tesla system with solar panels capable of filling the battery during the day is said to reduce the electrical bill by one third to one half.

Most solar systems have no battery backup. With lower subsidies and less payout for energy delivered back to the grid, owners of solar systems seek ways to keep the extra resource generated and store it in batteries. This will increased the cost as a solar system with a Li-ion battery will be substantially higher.

To fully charge the Tesla battery during the five hours of optimal sunshine per day will require a solar system that delivers 5,000–12,000W. At an estimated cost of $2 per watt, a 10,000W solar hardware alone will come out at $20,000. Installation and the DC-AC converter to convert the solar DC to compatible AC power and synchronize it with the grid might double the cost. The battery will be extra.

Another hidden expense when calculating the cost of solar system that is often overlooked is the end-of-life. Solar panels have a life span of 25 years and Tesla guarantees the battery for 10 years. Only time will tell how enduring the Li-ion battery will be in a solar application and how much capacity they will retain after 10 years of continuous service. 

By all expectations, the Tesla battery will use the same technology that works so well with the Tesla EVs. These electric powertrain batteries use the NCA cells (nickel-cobalt-aluminum) that carry high specific energy and are well suited for deep cycling.

Besides limiting the discharge power on the Powerwall to 2kW, another means of adding longevity is a partial charge. Electric vehicles make use of this reduced output range by charging a new battery to only about 80 percent and discharging to roughly 30 percent. As the battery ages and the capacity drops, the battery management system gradually widens the bandwidth and the net effect is an energy delivery system that stays stable not only when the battery is new but even after 10 years of service. Once the full bandwidth must be used to get the full energy with each cycle, the pampering stops and the capacity will begin to fade more quickly because of the added stress.

In terms of performance characteristics, the Powerwall will behave more like a hybrid car than an EV. While the EV depends fully on the battery for propulsion, the hybrid still drives with an empty battery but only loses electric assist. In this respect, the hybrid battery is more forgiving. Tests revealed that a hybrid battery with 40 percent capacity had only marginally increased fuel consumption compared to a battery with a 100 percent. In a similar way, the Powerwall will not leave the dweller in the dark and still deliver energy with a partial capacity, albeit the system will become less efficient.

Although the purchasing price of Li-ion is higher than lead acid, the cost per cycle is lower due to enhanced longevity and immunity to partial charge. Li-ion is also one of the most efficient batteries in terms of losses during charge and discharge. A battery that became popular with mobile phones, laptops, power tools and medical devices is making inroads into stationary applications but the trusted Lead acid will keep its market share for installations in which deep discharges are only required occasionally, such as UPS. Modern micro-grids supporting renewable resources will mostly be run on Li-ion.    


Summary

The purpose of the Tesla battery is to make mother earth a bit greener but other forms of energy conservations must also be addressed. In terms of energy usage, private cars are one of the least efficient modes of transportation. The internal combustion engine utilizes less than 25 percent of the net calorific value from the fuel for propulsion. Such inefficiency becomes outright disturbing when taking into account the weight of the vehicle with a single passenger, the driver. By accelerating a 1.5-ton vehicle, less than two percent of the energy moves the 75kg (165lb) driver, his briefcase and lunch bag; 98 percent goes to heat, friction and kinetic energy that is mostly lost.

The Tesla battery moves us in the right direction without sacrificing comfort and demanding a change in lifestyle. Adding the Powerwall to Tesla’s portfolio of products provides an opportunity for adding a new economy of scale to the battery industry which will drive technological improvements and promote cost reduction. Storing energy for later use will further benefit the battery industry, of which Tesla is increasingly assuming dominance.


Last updated 2015-06-01


 

About the Author

Isidor Buchmann is the founder and CEO of Cadex Electronics Inc. For three decades, Buchmann has studied the behavior of rechargeable batteries in practical, everyday applications, has written award-winning articles including the best-selling book “Batteries in a Portable World,” now in its third edition. Cadex specializes in the design and manufacturing of battery chargers, analyzers and monitoring devices. For more information on batteries, visit www.batteryuniversity.com; product information is on www.cadex.com.

 

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Comments

On May 7, 2015 at 12:34pm
BDalzell wrote:

I enjoyed your discussion.

A small quibble about this - which is part of the Tesla promotion;

“The Tesla system with solar panels capable of filling the battery during the day is said to reduce the electrical bill by one third to one half.”

Well,  my experience with my 44 solar panels, a solar system, grid tied, with no battery backup, reduces my electrical bills by 50% over the year.

In our area, Maryland, solar systems with “net metering” are not eligible for rate differentiation between peak and off peak hours so for now,  I might as well “store’  my excess on the grid and take it back as I need it.

As I understand it, the electric utility is most efficient if it is running its plants at a constant rate of generation. Ideally small renewable power producers would be the source of the needed the extra peak power and the grid the source of off peak power since at least in the summer a lot of peak need is pushed by air conditioning during the day. However in the winter the opposite, occurs. It is colder at night.

Do you have some insights into flow batteries for integration into solar/wind power systems? The reading I have done on flow batteries suggests they are promising and could belong to the power companies and be installed as local storage in neighborhoods with a lot of individual solar homes, preventing over loading of the grid during the day and returning power at night at a relatively low cost.

They are not small, a set up is done in a shipping container sized installation.

American Vanadium is one of the companies working on these types of batteries.

On August 8, 2015 at 10:16pm
ben wrote:

Thank you for the information.

Just have one question to verify with you:

“to fully charge the Tesla battery during the five hours of optimal sunshine per day will require a solar system that delivers 5,000–12,000W”.

Why 5000 - 12000 W?

The tesla battery comes in 7kwh and 10 kwh.
assuming the battery system ( battery and inverter) ‘s efficiency is 90%:
If i have a 3KW system and it will deliver 3kW output during optimal sunshine,  shouldnt i just need about 2.6/3.7 hours to fully charg the battery of 7kwh and 10kwh?
Please kindly advise if my calculation is wrong.

Thank you.

On August 24, 2015 at 5:54am
John wrote:

Tesla tries to sell their surplus batteries as their car sales plummet.

To power your house 50% of the time (as the sun doesn’t always shine and wind power almost never supplies 100% rated capacity, more like 14%) you will need for a normal household (3500 kWh per year) 1700 kWh of powerwalls. That’s 170 pieces and they cost 3500 each.
You do the math!

(spoiler alert : almost 600000 usd without installation cost)
And thats for every household in the world.

Electrical energy storage is astronomical expensive.

On January 13, 2016 at 7:09pm
Tom wrote:

@John: Your logic is off. A household does not require a 3500 kWh supply accumulated and available at once. The power is used over a period of a year. Assuming your number, 3500 kWh, is correct, that’s approx 9.6 kWh a day, therefore one Powerwall would be sufficient.

Tesla car sales plummeting? Their order numbers are increasing. Are they making money - that’s another story, but I believe the question should be when are they going to make money, not ‘if’.

On February 15, 2016 at 11:07am
James Tomlinson wrote:

I question the Tesla Powerwall’s advertised cycle life. They claim a cycle life of 5000 cycles for the Powerwall 7 kW. This is seriously at odds with the information on this website for Lithium Nickel Manganese Cobalt Oxide. At 5000 cycles, the 7kW Powerwall compares favorably to ANY battery. At a more realistic 1000-2000 cycles, the Powerwall is comparable to standard AGM batteries and falls quite short compared to advanced AGM (nano-carbon).

On July 4, 2016 at 7:42am
peter van den berg wrote:

strange how the powerwall warranty suddenly disappeared, i guess as per usual with batteries expectations didn’t come up to reality http://investorintel.com/cleantech-intel/tesla-energys-incredible-shrinking-powerwall-warranty/

By now we all come to realize that there is no magic bullet, batteries aren’t a solution for anything else but flashlights and money would be better spent researching micro energy/matter conversion powerplants

On November 10, 2017 at 12:04pm
Mark D Medonis wrote:

Interesting article, power generation is a complex topic and you gave a nice overview. The comments are always interesting. The PowerWall is still not a very economic choice for residential use, but it is a view of the future. Substation scale use, however, is where it clearly shines, as the San Diego and South Australia installations have shown. As well as the installations in Puerto Rico to bring power back to hospitals.

In response to some of the comments, AGM lead acid batteries will never get to 1000 cycles. Also, the PowerWall is not a recycled Tesla car battery, in fact, they use Samsung cells in the PowerWall so as not to impeded the greatly increasing quantity of Panasonic cells needed for the cars.