Moving beyond cars, Tesla uses batteries to bolster power grid

Just off a freeway in Southern California, 396 refrigerator-size stacks of Tesla batteries, encased in white metal, have been hastily erected with a new mission: to suck up electricity from the grid during the day and feed it back into the system as needed, especially in the evening.

The installation, capable of powering roughly 15,000 homes over four hours, is part of an emergency response to projected energy shortages stemming from a huge leak at a natural gas storage facility.

The project, which officially came online recently, but began operating at the end of last year, is an important and surprising demonstration of how utilities can use enormous collections of batteries in place of conventional power plants.

It is also an indication of how rapidly Tesla is moving to transform itself from a luxury electric carmaker into a multifaceted clean energy company.

Manufactured, shipped, installed and readied for operation in roughly three months, the batteries are connected to distribution circuits at Southern California Edison’s Mira Loma substation in an industrial section of Ontario, about 40 miles east of Los Angeles.

California is on track to have an overabundance of energy during the day when its many solar panels are producing energy, but that supply drops sharply as the sun sets, precisely when demand rises, with residents heading home to use appliances and, increasingly, charge their cars.

At the same time, the state’s aging nuclear plants are either closed or being phased out, putting even more pressure on utilities to find alternative ways to feed the grid. Storage is a natural solution, utility executives say, helping to smooth out variations in the power flow from rooftop customers as well as when solar falls off and conventional plants haven’t yet filled the gap. Ronald O Nichols, president of Southern California Edison, said the utility was looking for more ways to use that energy rather than having to curtail solar production, “which makes no greenhouse gas reduction sense.”

Given the cost of land and the air quality requirements that limit the number of hours plants can operate, Nichols said, new natural gas plants can cost a lot to build. In contrast, batteries are more flexible and do not require the same kinds of infrastructure, including water and fuel supply conduits, as conventional generators, avoiding the need for lengthy environmental reviews and permitting processes.

As a result, energy analysts say, battery installations are likely to become increasingly common, whether to vary the number of power supply options to enhance reliability or as part of a move away from fossil fuels in order to meet climate and other environmental goals. As an early adopter of renewable technologies, California has been willing to pay high prices, and has, in turn, helped lower them for other markets, said Swami Venkataraman, a senior VP at Moody’s Investors Service, who analyses the utility sector.