In a surprising move, Tesla announced that it is looking to sell its very first virtual power plant, which is operating in South Australia.
Tesla has a long history with the energy industry in Australia, where it launched several first projects, such as its “big battery” project.
South Australia, in particular, has a lot of electric grid issues and some of the highest electricity costs of any developed country.
While in the region during the launch of the big battery, Tesla CEO Elon Musk was interviewed and presented with the significant hardship that Australia’s high electricity prices are putting on low-income families.
The unstable grid and high electricity costs result in some families having to decide between keeping the lights on or going hungry.
The CEO was visibly emotionally affected by the issue and vowed that Tesla would “work harder” to help solve the problem.
He wasn’t kidding because a few months later, Tesla announced that it reached a deal with the South Australian government to install solar arrays and Powerwalls on up to 50,000 homes – many of them homes of low-income families.
The goal is to lower electricity rates for those families by combining those Powerwalls into a large virtual power plant that can provide grid services.
6 years later, the virtual power plant has had a significant impact on many families that got subsidized system now providing them with cheaper electricity, but the project has fallen short of its goal of being in 50,000 homes.
Tesla is selling the Virtual Power Plant
Today, we learn that Tesla is trying to sell its South Australian virtual power plant.
According to a new report from Australia’s AFR, Tesla is circulating a sale pitch for the virtual power plant with prospective buyers in Australia.
Tesla claims that the virtual power plant is distributed in about 7,000 homes with a 35 MW capacity and about 70% of the systems are coupled with solar power.
The company’s pitch mentions that there are plenty of opportunities to grow the system and Tesla wants to remain a partner by supplying its Powerwalls and its Autobidder software to manage the capacity and sell electricity.
There’s no mention of the price range Tesla is looking for.
Electrek’s Take
Top comment by Luis Alejandro Masanti
The ‘big question’… as I see it… is Why did it only get to 7,000 homes after 6 years?
Where the 50,000 over expected?
Was the government blocking the project?
Was Tesla the only partner financing the project?
I wouldn’t read too much into Tesla selling this virtual power plant. We previously reported that Tesla is looking to launch its own ‘Tesla Electric’ electricity retailer in the country.
My guess is that Tesla wants to focus on this new offering.
I hope that the sale becomes public and we get to know the value of a 35 MW virtual power plant. It would be interesting to see if it creates a market to sell and buy virtual power plants like regular power plants.
What do you think? Let us know in the comment section below.
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