Yesterday, Saturday 13th, in South Australia the Tesla battery at Hornsdale Power Reserve was paid AU$1,000/MWh (USD$790/MWh) to absorb excess electricity from the power grid. The battery owners will later be able to sell this energy also.
The battery has become famous for coming online in under 100 days after an Elon Musk Twitter betand later reacting to a crashed coal plants in milliseconds.
Starting around 12 PM, and continuing until around 4 PM, the battery was paid during at least five separate windows.
Per my interpretation of the below tweeted image, electricity was priced above $0/MWh for only 25 minutes – meaning negative pricing for around 215 minutes. At a minimum, there were 183 minutes (85% of the time period) where the price of electricity was a fully negative $1000/MWh ($1/kWh). During the four hour window, the battery discharged electricity for short periods (nine minutes total) four separate times.
The Tesla built battery was in ‘Load’ (charging) mode, while electricity was negatively priced, for at least 194 minutes. During that period the battery was accepting power at rates between 15-26MW, for varying time periods.
Roughly, during the four-hour period, the battery system absorbed greater than 66MWh of energy, which would be equal to at least AU$66,339 in revenue – and potentially up to $76,153.
Events of this nature occur when there is more electricity being produced than the power grid can absorb. Powerplants will sometimes disconnect themselves from the power grid when these things occur, transformers can blow, etc – this is what similar to what happened when the Tesla battery raced to action a few weeks back. The power grid managers try their best via predictive tools to manage energy usage with generation, but complexity always creeps in.
The power industry has attempted to motivate power products, users and – now – battery owners to manage these overages via market pricing. Someone, somewhere (an algorithm probably) thought this event was worth tens of thousands of dollars.
Again, please give these numbers some leeway, as I don’t know the exact timing that things were priced at exactly what price, and the rates at which Tesla was taking on electricity during those periods.
To the victor comes the spoils. The battle was of speed – who can react to an imbalanced grid the fastest and in the most economical way. Often times, corporations and electricity users are asked to run hardware and absorb this juice (as happened in Germany a couple of weeks ago). But those folks don’t have a chance at keeping up with this battery.
The battery, instantly knowing the grid was approaching capacity, functioned beautifully by reacting when needed most. And because that function is valuable – it was paid for the work. And the owners took the cash home. Cash drives installations. And since this machine can react in a time period of far less than one second and use the electricity smartly later on, running machines for the heck of it doesn’t make sense.
I wonder how much electricity we will save with a smarter grid – just from transactions like this where we don’t ‘waste’ the juice running machines or warming water a little extra.