Projects -> Solar

Tesla's Powerpack is just too expensive

2016-04-26 12:52:26 - wk057

Hi Everyone!

So, I just wanted to make some notes (possibly a small rant) regarding Tesla's PowerPack and their recently released pricing.

According to Tesla's website, the pricing for a new 100kWh PowerPack is $47,000.  So, $470/kWh.  

For comparison (and, admittedly, I forget where the number came from) the rumored pricing around the announcement was around $250/kWh for the PowerPack.  Also, at the time of the announcement the PowerWall was 10 kWh for $3500, or about $350/kWh.

Since then the PowerWall has been reduced to 6.4 kWh, presumably to the original price for the daily cycle model of $3000, or ~$469/kWh... on par with the PowerPack.

And don't forget that this doesn't include the cost of installation and other equipment needed to make it all work.  Tesla's own inverter for the PowerPack, which requires a minimum of two, is 250kW and costs $65,000.  So, the lowest priced PowerPack setup is about $162,000 plus tax and install costs.  Install costs are bound to be substantial, especially if you want to use this setup for backup purposes and not just demand shaving and such.  Oh, and that's just to get the batteries hooked up to do something.  No solar, no wind, no generation of your own.  Just grid tied batteries.

Now for a fun hypothetical:

Let's say you can get the minimum system installed for $175,000 (wow, only $13,000 for taxes AND installation... I'm being generous here).  That's a 200kWh battery system.  Tesla's website has the specs for the system and put round trip efficiency at 81.5 to 83%.  Let's go with 83% for now.  So, let's say you can get your electricity to charge these batteries for free somehow (legally), and then somehow you can sell it back to the utility for some outrageous amount, like $0.40/kWh.   Let's also say you can do this every day (get for free at night, sell for premium during the morning or evening).

So, let's split the difference on the efficiency losses.  Since the incoming power is free in this scenario, we don't care about charging losses.  That gives us about 91.5% efficiency pumping this power back into the grid... or about 183kWh we'll get paid for.  That's about $73.20 profit per day in this highly contrived example.

Let's just stop there for now.  $175,000 divided by $73.20 = ~2390 days = ~6 years and 7 months.  So, six and a half years just to break even using this ridiculously contrived example where you can somehow get completely free energy to charge these then resell at nearly the most expensive worldwide electricity price.... every single day. lol.

OK, so if you had that setup, less than 7 years to break even.  Sounds awesome!  Alright, well... good luck finding a situation where you can actually make my crazy hypothetical work.  That's over a $0.40 off-peak to peak cost delta (remember, we didn't factor in efficiency losses for charging).

Also, we didn't factor in any lost revenue due degradation of the battery packs over time, which is inevitable.  Notably absent from Tesla's new site about the PowerPacks is anything even remotely sounding like a warranty.  Originally rumored at 10 years... but likely wouldn't cover normal degradation anyway.

Long story short, for usage shifting, this still doesn't make any sense pretty much anywhere in the world, IMO.

Now, an example I don't have time to work up that may work out better is demand charge leveling.  Utility companies can hit businesses pretty hard with demand charges (a charge for the peak power delivered at any time).  These can be particularly high in the summer in most places.  For example, PSE&G's demand charge can be as high as about $9.50 per kW per month.  So, a Tesla system that could offset a significant portion of demand charges could maybe work out on a large enough scale.  To match my example above it would need to earn/save over $2100/mo with just two PowerPacks and a Tesla inverter, which I think is impossible since Tesla says the max discharge is 50kW per PowerPack, meaning the setup above could only offset at most 100kW in demand charges, or < $1000/mo best case, or basically double the ROI time of my crazy above example.  *shrugs*  Maybe some other time I'll try to find a demand charge situation that fits.

For now, I'd say hold off on the PowerWall/PowerPack.  They just don't make enough sense at their current prices, IMO.

Now, for comparison, and patting myself on the back a bit, my personal off-grid solar setup has ~180kWh of battery storage, 44.4kW in PV, and 64 kW in off-grid inverters (which could be used as grid hybrid inverters, but I don't).  The cost for all of that, installed, was less than the cost of Tesla's two PowerPack and inverter setup.  And keep in mind, I have basically the same amount of storage as that setup PLUS 44kW of PV, all fully installed... for significantly less money than just the parts from Tesla's setup.

Admittedly, my setup isn't quite as pretty as a couple of PowerPacks.  It does take up significantly less floor space, though.

Maybe I should go into business competing with Tesla... lol.

Anyway, that's my rant about Tesla Energy.  I think it's an awesome concept, and will be the best thing since sliced bread once they get the prices down to about half of what they are today.  Until then I think the market where it is useful is very limited.