Car and energy company Tesla has teamed up with the South Australian government to build what would be the world’s largest virtual power plant.
The plan consists of outfitting 50,000 homes with solar panels and Tesla Powerwall batteries that will combine to produce 250MW of energy. The energy will be stored in the batteries and any excess will be fed into the power grid to provide energy to the entire region.
The “virtual” aspect comes into play as the system’s software can decide when to store energy in the battery and when to sell it back to the grid. During a blackout the system will disconnect from the grid and send energy exclusively to the house where it is installed.
The South Australian government says the virtual power plant could provide 20 percent of the state’s average daily energy requirements. The plan could lower energy bills by 30% for participating households, according to an analysis by Frontier Economics.
“All South Australians will also benefit from the increased generation in the South Australian energy mix, with lower energy prices and increased energy stability,” the South Australian government says.
An initial trial has already commenced, with 1,100 public housing properties receiving a 5kW solar panel and a 13.5KWh Tesla Powerwall 2 battery at no cost. An additional 24,000 public housing properties will receive a system soon after, with a wider rollout to private homes anticipated in 2019, depending on the success of the trials.
Tesla will build a service hub for the power plant at outside South Australia’s capital city of Adelaide in order to monitor and service the system. This is key as the region has been plagued by power failures in recent years.
South Australian Premier Jay Weatherill said in a tweet that more than 6,500 homes have already signed up to register their interest in participating. Tesla will review all properties to see if they are able to participate in the system.
The project is being funded via a government grant and a state-funded technology fund totaling $32 million Australian dollars.
This is the second big energy undertaking for Elon Musk in Australia. Musk provided South Australia with the world’s biggest lithium-ion battery system after a crippling blackout in 2016.