First utility sales of Tesla Powerwall include ‘no upfront cost option’ in Vermont

The state was among those to suffer in Hurricane Irene, meaning backup power may be a driver for consumers there to adopt batteries. Image: Wikimedia user: Daniel Case.
The first Tesla Powerwall home energy storage systems to go on sale in the US through a utility are being sold through Vermont’s Green Mountain Power which is including a “no upfront cost” option for its customers.

Green Mountain Power serves just over a quarter of a million customers and has ordered 500 Powerwall units from the Elon Musk-led manufacturer, which it expects to take delivery of in January. Tesla had originally launched Powerwall and its commercial/utility-scale counterpart Powerpack to great fanfare in April and touted its expected availability before the end of 2015, leading Green Mountain Power and others to widely advertise that Powerwall would be on shelves in that timeframe.

The GMP deal also sheds more light on the sort of prices customers across the world might expect to pay for the device – Tesla launched it at a quoted price of US$3,000, but this did not include the cost of installation or power electronics and other components necessary to connect the device into homes and onto PV systems.

Along with its launch date and price, the other big question over Powerwall – and other residential and larger scale energy storage – has been the business model, or models, under which it will be offered. Green Mountain Power has come up with one possible answer, giving its customers three possible purchase options and looking to make money from the benefit to the overall electricity network that the devices could offer, including lowering peak demand.

GMP also said that this lowering of peak demand could result in cost savings for all of its customers, reducing the cost of transmitting electricity and meaning the utility needs to provide less electrical capacity to meet demand. In the US and in other territories where rooftop solar has been blamed, perhaps unfairly, for the costs incurred to network operators of accommodating PV onto the grid, this dual use for the battery could be particularly important.

Monetising the ‘wall

Customers can either buy their Powerwall outright for US$6,500 and either pair it with their solar PV system or simply plug it in to store electricity straight from the grid. One of the main selling points in the north eastern state which experiences power outages each winter is the device’s backup power capabilities – the average blackout or outage in Vermont last around two and half hours, while Powerwall, depending on what appliances and devices it is used to power, can provide two to four hours of uninterruptible power.

A second option allows customers to ‘share’ use of the battery with the utility, which means they pay the same US$6,500 upfront cost, but then also receive a US$31.76 monthly rebate from their electricity bills, by giving GMP access to some of the battery’s capacity to lower peak energy costs.

The third and final option will be a pure ‘no money down’ deal, where customers would pay US$37.50 a month in subscription fees for sharing access to the batteries with GMP.

An initial 10 customers will trial the Tesla Powerwall in GMP’s ‘Energy City of the Future’ project in Vermont’s Rutland, a town which was hit hard by 2011’s Hurricane Irene, before a rollout across the state.

It was clear from the outset that strategies to monetise a combined range of services from Powerwall would likely be important to Tesla’s business model beyond the first waves of early adopters. Controlling the behind-the-meter devices in an aggregated manner from the utility’s position in front of it has potential benefits to the utility, grid and customers. Peter Rive, CTO and co-founder of SolarCity, the installer closely linked with Tesla, said in a blog at the time of the April launch that SolarCity was interested in the possibility of aggregating the capabilities of a number of connected storage systems, controlled remotely by utility companies. Rive said aggregated batteries could provide capacity, reactive power or voltage management and directly appealed in that blog to "anyone reading this who is responsible for managing grid operations" to contact SolarCity.

There are likely to be many variations on the theme of storage systems that combine individual benefits to homeowners and businesses with wider network benefits.

German company Sonnen’s recent launch of its community energy trading platform sonnenCommunity offers customers with its energy storage systems can trade PV-generated electricity stored in their batteries with other members of the community.   

More utility storage action as Duke Energy starts commercial solar-smoothing programme

Duke Energy, another US utility – albeit a much larger one than GMP, serving around 7.2 million people including a monopoly on utility power supply in North Carolina – announced this week that it will partner with commercial storage specialist Green Charge Networks to help customers integrate solar into networks.

Starting in southern California and Hawaii, Green Charge Networks will market energy storage systems for solar firming (also known as smoothing) to customers and projects of REC Solar, the installer owned by Duke’s renewable project arm Duke Energy Renewables.

As well as increasing the amount of solar that can be self-consumed onsite, the storage systems will, as with most commercial-scale energy storage in the US, help lower businesses’ bills by lowering their peak demand from the grid.

Green Mountain Power has ordered 500 Powerwalls from Tesla. Image: Tesla.