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Puff Piece For Tesla Ignores The Real Truth

April 2, 2020

By Paul Homewood



Elon Musk owned Tesla installed a battery farm in South Australia in 2017 and has since helped residents save $116 million in energy costs, Bloomberg reports.

The company installed the world’s biggest lithium-ion batter to help reduce the risk of blackouts as the country moved to renewable power generation.

Operating via the Hornsdale Power Reserve, it has helped to restore stability to the network and lower the costs of running the power grid, according to reports.

The decision to install the battery came after a Twitter ‘bet’ between Musk Australian software billionaire Mike Cannon-Brookes where Musk promised he could build the battery ‘in 100 days or its free’.

Two years on and the battery farm has slashed the costs required to regulate the South Australian grid by about 90 per cent, Bloomberg claims.

Operating via the Hornsdale Power Reserve, it has helped to restore stability to the network and lower the costs of running the power grid, according to reports

The 129 megawatt system installed by Tesla offers a way to tackle the variable power generated by wind and solar generators – it stores up the energy until it is needed and distributes it through the grid during lower generation periods.

They smooth out the power flows that can threaten the stability of a network made up primarily of renewable sources of energy.

This is what was happening in Australia until the Tesla battery was installed – but since then it has helped respond to those issues quickly.

The battery has been designed to help cover temporary dips in wind power, say for 15 minutes, or help control frequency on the grid at times when natural gas-fired plants are unable to help balance generation and power demand.

The state has yet to say how much it paid for the battery, which is part of a £293 million ($390 million) plan that includes diesel-fired generators to help keep the lights on following a string of blackouts over the past 18 months


What this doubtlessly well coordinated puff for Tesla does not tell readers is that none of this extra cost of grid balancing would be necessary at all without the overloading of the SA grid with unreliable wind and solar power. Whether Tesla’s batteries are a cheaper option than other forms of network balancing is beside the point.

SA has a population of 1.8m, so scaled up the £293m package would be the equivalent of about £11bn in the UK. A huge bill by any account.

Perhaps instead of expecting SA residents to pay these costs, wind and solar farms themselves should be responsible for the cost.

The claim that the battery is “powering 30,000 homes” is ludicrous anyway. The 100MW system can only supply 129 MWh, so if the grid went down, those 30,000 homes could only be supplied for 77 minutes.

The purpose of Horndale is not to tackle the variable power generated by wind and solar generators, as claimed. Only proper sources of dispatchable generation can do that. Horndale’s role is simply to provide short term balancing, usually for a few seconds or so, whenever demand and supply are out of balance. This gives time for generators to come on line.

There are many methods to do this, including those diesel generators mentioned, so there is nothing radical about battery storage.


The report by the specialist engineering advisory company Aurecon, which has triggered this Tesla love fest, is actually revealing in a number of ways.

Horndale’s (HPR) central function is to provide security to the SA grid via SIPS, which was et up to prevent the loss of the Heywood interconnector to Victoria:



And as the Report itself explains, the increasing mix of renewables has increased the reliance on the interconnector:

Closure of local generation in SA in conjunction with increased interconnection
capacity has increased SA’s reliance on interconnection for reliability of supply





Whereas previously there was ample thermal generation to provide not only dispatchable power but also importantly system inertia, the SA grid now has to rely on Heywood for that as well.

Consequently there is now a need for the expensive system security services provided by Tesla and others.




Despite the fact that about half of SA’s electricity comes from renewables, demand still has to be backed up in full by gas and diesel.

Even then, the SA network still needs the interconnectors to export power when wind generation is high, and to import when it is low.





In short, SA’s high mix of renewables is only sustainable because the rest of the Australian electricity network is there to fall back on.


Which brings us back to Aurecon, who published this piece of puff and apparently funded it. But is it truly independent, as they claim? Maybe not.

According to their website, battery systems are a useful source of income for them. And certainly one they would no doubt like to grow.


A nice glowing report about Horndale’s Tesla batteries might help to bring in a bit more business.

Or am I just being an old cynic?

  1. tim leeney permalink
    April 2, 2020 7:05 pm

    Enchanted by the lithium ion batter – is this for cricket, or just pancakes?

  2. Curious George permalink
    April 2, 2020 7:44 pm

    Lithium batteries have a high energy density and a high price. Would lead acid batteries be better for a stationary application?

    • Michael permalink
      April 3, 2020 8:38 am

      They’re certainly cheap and recyclable

  3. Harry Passfield permalink
    April 2, 2020 8:12 pm

    Remembering that a lot of Cons were sent to Aus in the past it’s hardly surprising there’s still a lot of cons going on there. And all for 1.8M people!!

  4. Joe Public permalink
    April 2, 2020 8:16 pm

    The daily Fail’s credibility is dented when it states “The 129 megawatt system installed by Tesla ……”

    The Hornsdale Power Reserve’s battery has a discharge capacity 100MW. Its storage capacity is 129MWh.

    “The claim that the battery is “powering 30,000 homes” is ludicrous anyway. The 100MW system can only supply 129 MWh, so if the grid went down, those 30,000 homes could only be supplied for 77 minutes.”

    It’s not even that good, Paul.

    “The project reserves 70 MW of its discharge capacity for designated system security services contracted with the South Australian (SA) Government. (Only) The remaining 30 MW power capacity and 119 MWh energy storage is available to Neoen for market participation”

  5. April 2, 2020 8:45 pm

    As Harry suggests, the clue is in the name: Au-Re-Con

  6. Graeme No.3 permalink
    April 2, 2020 9:11 pm

    This battery is so “successful” that Electranet (the SA grid controller) is spending $A166 million to install 4 synchronous condensers in 2020. Essentially they do what a conventional power station used to do free of charge.
    Think of them as big flywheels. The synchronous condensers to be installed at Davenport are each 8 metres long, 5.6m high and weigh 172 tonnes.
    While helping to support a reliable power system, installing synchronous condensers will also avoid the need for costly compensation payments to be made to ? (guess) and is estimated to deliver a net cost saving equivalent to $3 to $5 per year on a typical South Australian residential electricity bill.

    In addition the S.A. Government wants to install another interstate interconnector (this time to NSW a net importer of electricity) at a cost exceeding $1,000 million** to improve system stability. In practice it is to allow excess production from the wind turbines to be sold (at a low price) rather than, as now, some farms being ordered to shut down. You can judge what difference this will make because the Capacity Factor has been reduced (by shutdowns) by 10% (was C.F. 30% now 27%), and the selling price when the wind blows can drop to zero.

    **which they don’t have, and expect ‘contributions’ from the Federal other State governments.

    • Graeme No.3 permalink
      April 3, 2020 11:32 am

      How successful this ‘big battery’ has been in stabilising the grid can be gauged by the 27 interruptions (1 to 4 seconds) in electricity in two & a quarter hours this evening as a cool, wet (welcome) change rolls South Australia. This weather change was neither unusual nor unexpected.
      Cut off the TV while I was trying to get the 7 day weather forecast, but it kept resetting the TV (& recorder box).

      Make that 29 interruptions in 2 hours 35 minutes.

  7. ray Sanders permalink
    April 2, 2020 9:32 pm

    As I type the carbon emissions per kWh generated of South Australia are around 370g CO2 per kWh which are actually more than 12 times greater than those of a real country such as France where a grid a zillion times bigger is only producing 30g CO2 per kWh.

    • Ben Vorlich permalink
      April 2, 2020 10:19 pm

      ray Sanders, don’t worry Macron’s plans to close most of France’s nuclear power plants and replace them with so called renewable capacity will ensure that France’s CO2 per kwh will soon reach the levels of South Australia.

      • mikewaite permalink
        April 3, 2020 9:18 am

        Ben, will Macron really replace the nuclear power stations. If so, it would be worrying for us . Currently wind is only generating 2.8GW compared to 2GW from France. Recently the continental interconnectors have been supplying up to 15% of our energy ( at a time when industry and offices have been almost completely closed down).

  8. Joe Public permalink
    April 2, 2020 9:50 pm

    Strangely, the puff piece fails to acknowledge that South Australia is now benefitting from 12x Wärtsilä 50DF dual*-fuel reciprocating engines capable of generating approximately 18MW of output each, built at Barker Inlet Power Station on Torrens Island.

    *Natural gas is the primary choice; oil is as standby.

  9. markl permalink
    April 2, 2020 10:28 pm

    Who do they think is buying their codswallop? Dismantle a reliable and built for purpose energy generation system, replace it with an intermittent and unreliable system at a huge cost, then make additions to the new system at another huge cost to make it close to the reliability of the original system, and then claim it’s saving money! How will they spin the inevitable cost of the maintenance and replacement for this “new and improved” system every 20 years (if they are lucky)? Australia, the crash test dummy for renewable energy.

  10. April 2, 2020 11:14 pm

    Great job, Paul!

    That Hornsdale, SA battery is the largest battery in the world. It cost A$66,000,000.

    But, as you noted, it’s NOT for significant energy storage. It’s for “frequency regulation” (FCAS) and minute-by-minute electricity arbitrage. It cannot cover solar/wind output lapses, because its capacity of 129 MWh (not “129 megawatt”, BTW) = just 4 minutes of power usage at South Australia’s average usage rate (much less during peak demand), and the battery can’t discharge that fast anyhow.

    Batteries cannot solve the fundamental unreliability of wind and solar power. No plausible battery tech breakthrough could enable enable wind & solar energy to be stored on windy days for windless nights.

    Bill Gates has been suckered into believing in the fake “climate emergency,” but even he recognizes that wind and solar + batteries cannot possibly replace reliable base-load power generation:

  11. Frosty Oz permalink
    April 3, 2020 4:51 am

    Significantly, the analysis of “saving” in FCAS regulation costs commences in week 12 of 2016, and does not compare or take into the prior years when Northern and Playford power stations were available to provide FCAS, until driven out of the market by the solar and wind.

  12. Duker permalink
    April 3, 2020 6:09 am

    South Australia households have the highest electricity prices of the mainland eastern states….I wonder why that Is ?
    Plus like a lot of Australia cities rooftop solar panels are endemic, again affecting network stability
    peak hour evening usage per household is 2.4kWh

    • 4 Eyes permalink
      April 7, 2020 4:19 am

      and those with solar and wind are not paying the true cost of being connected to the grid, just in case, so the rest of us pay more i.e. the variable cost of electricity is a minor part of the total cost. but we get charged for usage

  13. April 3, 2020 9:09 am

    The claim that the battery is “powering 30,000 homes” is ludicrous anyway.

    Indeed, and let’s state the obvious: batteries have to be charged by a source of electricity first, otherwise they can’t power anything.

  14. snedly arkus permalink
    April 3, 2020 10:39 am

    Elon Musk made the boast of if it’s not ready to go on time it’s free was made during installation when he knew it would be ready on time. Musk is incompetent in many ways but when it comes to getting people to believe his PR he’s a master.

  15. Thomas Carr permalink
    April 3, 2020 11:25 am

    My goodness there is some impressive collective brainpower among the Commentators . It’s time to see if a moderator or editor would step forward so that the more complacent in the media world such as Bloomberg and the BBC can be sent authoritative rebukes with summary stats. on a regular basis or when gross follies are published.
    As before the editors and expert reporters will pay little attention to what challenges their authority and research . It is the proprietors and board chairmen who need to be informed.

  16. tom0mason permalink
    April 4, 2020 5:06 pm

    Rechargeable batteries are NOT a source of electrical power, they are just a method of storing some energy (in chemical bonds) that at is used at some other time.
    Recharging and discharging the batteries is a lossy method of attempting to iron out the instabilities in the system, instabilities that would be so much less if wind and solar were removed from the grid.

  17. John Anthony permalink
    April 6, 2020 2:10 pm

    South Australia committed economic suicide and has the unique distinction of having the highest electricity prices in the world!

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