Tesla Installs 7 Megawatt-Hour Battery for Emergency Power at a Japanese Railway

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Tesla just installed its biggest energy storage project in Asia to date — and deploying the hardware required just two days. (Here’s a time lapse of this construct on Instagram.)

According to Tesla, the 7 megawatt-hour installment in Osaka, Japan is meant to offer emergency backup power for a Kintetsu train line, with enough power to have a train safely to the next station in the event of a grid outage. The system, consisting of 42 of Tesla’s industrial-strength Powerpack batteries, will also help “decrease energy demand on the Osaka grid during peak hours. ”

The energy storage system can move among Kintetsu's trains to security for up to 30 minutes. It's the biggest installed Tesla battery in Asia, and fourth in the APAC region, according to the EV builder. 

Wood Mackenzie's storage analyst Dan Finn-Foley noted that “a hospital needs essentially unlimited backup so it's a tough sell to use a battery, but if all you need is one hour's worth of juice to bring the trains into the station,” then a battery “makes a lot of sense.”

Other railroad batteries

Japan isn't the only nation exploring the use of batteries in trains.

Former California Governor Jerry Brown has long imagined building America's electrified high-speed rail system. GE has built a battery-powered locomotive and China has made some forays into electric rail. Italian energy giant Enel has nebulous plans to install 10-megawatt-hour lithium-ion batteries on Russian railways to assist trains move better.

Batteries have also been applied in some regenerative braking pilot programs. But beyond a few cases, lithium battery technologies has yet to carve out a significant presence in the train industry.

The Osaka battery is set to begin operation on April 1. 

Tesla's overlooked energy business

Amid the nonstop drama of Tesla’s electrical vehicle attempts, it’s easy to lose track of Tesla’s energy company and its habit of setting energy storage setup records.

The present record-holder for the world's largest battery is Tesla’s 100-megawatt system in Australia. And Tesla has possibly won a contract from California usefulness PG&E for an even bigger 182.5-megawatt/730-megawatt-hour battery that will replace gas peakers and save ratepayers money.

At the recent Model Y unveiling, Musk signalled a renewed focus on its energy business. “This is the year of the solar roof and Powerwall,” he said.

“Batteries were at a premium in 2018 because all resources had to reallocated to Model 3 production — otherwise we were going to die,” he added. “But now that Model 3 production is going well, we're excited about the solar roof, solar retrofit and Powerwall. ”

Tesla deployed a total of 1.04 gigawatt-hours of energy storage in 2018, an impressive tripling of its 2017 figure. Tesla's 2018 investor letter claimed that”a better source of cells and new production equipment” will grow storage deployments to”over 2 gigawatt-hours in 2019″ with growing profitability.

“It’s clear that there is a huge opportunity for us in large scale energy storage,” Musk said recently.

A “startling” fall in battery LCOE 

Falling prices have made the use of batteries increasingly compelling, across a range of applications.

A recent report from Bloomberg New Energy Finance on levelized cost of energy (LCOE) found the long-term cost of supplying grid electricity from today’s lithium-ion batteries is falling even faster than expected, making them an increasingly cost-competitive alternative to natural-gas-fired power plants. 

According to its analysis of more than 7,000 projects worldwide, LCOE for lithium-ion batteries has fallen by 35 percent, to $187 per megawatt-hour, since the first half of 2018. 

As far as battery hardware costs (a different metric) are concerned, CEO Elon Musk said last year that Tesla can build batteries at the cell level for $100 per kilowatt-hour and will soon be able to build battery packs  at $100 per kilowatt-hour.

The BNEF report notes that “batteries co-located with solar or wind projects are starting to compete, in many markets and without subsidy, with coal- and gas-fired generation for the provision of ‘dispatchable power’ that can be delivered whenever the grid needs it (as opposed to only when the wind is blowing, or the sun is shining).”

The past year and a half has seen record-low prices set for solar and energy storage, including Xcel Energy's request for proposals in Colorado where solar-plus-storage bids came in as low as $36 per megawatt-hour, compared to $25 per megawatt-hour for solar.

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