Tesla: The Powerpack Business And Competing Technologies
Note: In the first part of the Tesla series, we discussed the electric car business of the company, in the second part (which you are reading now, we will address its energy storage business (Powerpack ).
The third part will then expand to the potential of Powerpack, Powerwall, and other ancillary business components.
The energy storage business has been developing for a long time.
Both mobile and still, the accumulated R & D efforts have reduced prices.
Backup for smartphones, PCs, UPS
Make up unit of Li-and other mobile electrical equipment
Cost-ion batteries (and other types)effective.
That\'s when Elon Musk began investing in electric cars and storage.
But don\'t make a mistake: massive energy storage is nothing new.
Tesla did not \"invent\" large-scale energy storage (battery ).
This technology has been around for many years.
Back at 1960 s, Ford (F) tried the same thing, but used another battery type: NaS battery.
But it failed.
Fortunately, Tesla (TSLA) has invested in another battery type (Li-
Ions) have been tested on various devices for a long time.
Therefore, the relevant specifications are well known (Advantages and limitations) when the company is established ).
However, Tesla is still playing a dangerous game.
You see, the company is in a Li-by-motor, mobile-
Ion batteries and fixed Li-ion batteries.
What are the pros and cons of this bet?
Tesla is an energy company.
This has nothing to do with the fact that it sells cars.
What\'s really important is what\'s underneath these cars.
That is, a battery that can store energy in chemical form and convert it into electric energy.
So we can assume that the real reason Tesla sells electric cars is to fund battery technology.
The only eligible is the electric vehicle market (demand for electric vehicles is one aspect --
The impact of the renewable energy revolution, veganism and other cultural changes ).
In fact, the electric vehicle (mobile) battery has the same \"core\" use as the fixed/grid battery.
They need to store a lot of energy and be able to convert it into electricity (electricity )-
All of this comes at a cost.
There are some changes in the features of these two categories (mobile, stationary): Electric vehicle batteries need to be light, have space limitations, charge fast and react fast.
Fixed batteries need to have a greater cycle life and store more energy.
After that, space and weight came in.
We will discuss all of this in this article.
The next question: since Tesla has invested a lot of money in energy storage, shouldn\'t that mean Elon Musk thinks it\'s very valuable? Well, it is.
You see, human evolution is always \"stored. based”.
It is possible to store food in order to form a larger society.
The ability to store knowledge allows science to expand (among other things ).
In addition to the efficiency of power production, energy storage is also possible
Built something that was lost when a large community was formed: Selfsustainability.
Now, if a major power line is damaged, a complete regional power outage will occur.
During the big ice storm in 1998 (related articles), a long power outage killed in Canada --
This could have been avoided if there were regional energy storage facilities, plus \"cheap\" power generation devices (E. G. g. , renewables).
Being able to store a lot of energy will allow for further self
Sustainable development projects are booming.
Like \"vertical\" advanced agricultural technology, uninterrupted power supply is required.
In fact, energy storage is a new revolution, not an electric vehicle, as it is often said.
Electric vehicles are basically the result of connecting Li-
Ion batteries on almost conventional cars (almost because the engine is electric ).
Electric vehicles are being developed and sold, eventually funding the development of battery technology. They are a by-product.
Now let\'s talk about what Powerpack (fixed energy storage) can provide: (a) the market efficiency is equal to a lower price: being able to store power in the form of electrolytic energy means that it can be sold on a future date.
We can now go beyond the \"spot\" price, which will make the electricity market more efficient.
This will eventually drag prices down.
When the price is low, households and businesses can also store energy and use it (or sell it) when the price is high ).
Contemporary installations have the software needed to automate this process (stored when the price is low, and vice versa ).
Both Powerpack and Powerwall are available.
(B) renewable energy power plants become more efficient: traditional power plants/facilitiesg.
There is an automated mechanism to limit energy losses.
They can adjust electricity production according to demand.
Renewable power plants, on the other hand, do not have this capability.
For example, when the sun shines, it is lost if all the energy generated is not consumed immediately.
Powerpack can end these inefficiencies.
In doing so, it will change the entire renewable energy sector to make the plant more efficient, thereby indirectly reducing costs.
This will give a major boost to the industry.
Powerpack can also be used to solve another problem facing renewable power plants: changes in power output streams.
When the wind blows a lot, the installation of a wind farm can generate a lot of electricity, but when it stops blowing so much, the electricity it generates will be reduced.
The ability to temporarily store the additional energy generated will make the output even, thus making the renewable power plant more efficient.
Please note that depending on the current storage capacity and cost,
Energy storage is mainly to provide efficiency (E. G. g. , renewables).
It also increases the quality of our lives. g. , blackouts).
In the future, we will be able to store a lot of energy, which will enable power companies to \"pre-
Production of electricity, even trade in the world.
At that time, the energy stored will become a common commodity that can be bought and sold on demand at any time.
Since storage technology is still in its early stages, it is wise for us to lower our expectations a little.
The 3D printing industry is an example of premature hype (see photo ).
As you can see from the chart, prices are normalized when expectations are not met (at the time, of course, the raw material crisis is falling apart ).
Stock prices have remained low since then.
Tesla\'s Powerpack products are not just competing with other similar technologies (batteries.
There are a wide range of energy storage options: we should note that batteries are not the cheapest type in terms of fixed energy storage (operating costs, strictly speaking, not installation costs ).
But growth in electric vehicle sales may indirectly change that.
Wikipedia summarizes the most common storage types (technologies) for us: Interestingly, fossil fuels such as coal are actually Products of solar energy. Just a note.
Now, before we begin to \"talk about batteries,\" we should stress for the last time the importance of the electrochemical energy storage to humans.
In addition to various applications, the technology has been developed for two centuries (even before the Alessandro Volta era), which means it is considered very important.
We should therefore look forward to continuous breakthroughs (lower prices and higher storage capacity ). ).
We are familiar with lead.
Acid and alkaline batteries.
The latter can no longer be charged, so it has nothing to do with our discussion. Lead-
On the other hand, the acid battery can be charged.
They have been widely used, for exampleg.
In traditional (internal combustion engine) cars.
Many people think
Acid batteries will be out of date.
This statement will become a reality if lithium
The price of ion batteries will drop to $100 per kWh or less.
But before that
Acid batteries have different uses: cheap energy storage.
Note: lead is currently recycled-
Acid batteries are a profitable business.
This is not the case with Li.
Lithium-ion batteries, even if lithium is 100% recyclable.
Tesla only with Lee-ion batteries.
In general, it is a wise choice because their specifications are very balanced.
The cost, power and energy density per kWh, the temperature range these batteries can handle, the charging speed, the reaction speed, and other features are balanced.
At least compared to other types (tables.
As you can see from the table, clues
Acid batteries are cheap (last column) but have low cycle life.
The NaS battery looks more balanced, but there are other specifications that have problems.
The mobile battery has a huge cycle life, but the cost is quite high and the reaction speed is very low.
We will discuss all these issues in this article.
Tesla uses two Li-
Ion battery technology: nickel-cobalt-aluminum chemical battery (NCA) and nickel-manganese-cobalt chemical battery (NMC ).
(A) Tesla electric vehicles use NCA batteries.
It has a high energy density, which means it can store more energy per unit of measurement.
Therefore, it takes up less space, which is an important requirement for electric vehicles.
(B) apply the NMC battery to the Powerpack product.
It has a longer cycle life, but takes up more space (and is heavier) due to its low energy density ).
* Note: depending on the cycle life, we mean how many times the battery can be charged/discharged before the maximum charging rate is less than 80%.
As for power-
Energy difference, think like this: how powerful my punch (strength) is, not how many punches I can punch before I get tired (energy.
The latter is measured in Wh (or kWh, etc.
) And Watt (or kW, etc. ) power. ).
Now, since both products (electric cars and Powerpack/Powerwall) use the same battery type (Li-
Tesla has benefited from accumulating knowledge and reducing costs.
The use of various types of products will reduce the efficiency of research and development.
This is one reason Powerpack 2 managed to reduce the cost from $470/kWh to $398/kWh --
Various specifications have also been upgraded.
However, critics point out that the actual price range is $500 according to Australian projects-600/kWh.
This is true for that particular project.
But we need to keep in mind that the cost of shipping equipment from the US to Australia (by sea) will be higher.
Smaller projects will also be more expensive due to low efficiency.
Fortunately, there is no loss in the installation in Australia.
The opposite is actually true.
Of course, the price of the government is lower. sensitive.
Their main concern is to expand the quality of life of their citizens and to win votes in the process.
However, private enterprises want to profit from such investments.
They chose a reasonable period during which the additional profit would be paid for the investment (an average of up to 3 years ).
Only after a \"refund\" occurs will they generate actual \"net\" profits from that particular investment.
Unfortunately, the price reduction rate of the Powerpack battery unit (NMC) will be slower compared to the electric vehicle battery (NCA.
This is because there is limited space for the cost of installation to drop.
As shown in the following figure, the final installation fee will cover a larger portion of the cost of the entire battery pack.
Thanks to economies of scale (retail products), the price of electric vehicle batteries will drop faster.
Powerpack is primarily a B2B business, which means a higher price for the product --sensitive.
Example: Model 3 \"consumer\" can buy a car just because he/she likes the look of the car, even if he/she doesn\'t really need it (not the real cost-effective).
However, the additional costs bring additional benefits.
The cycle life of the NMC battery (Powerpack) is much larger.
(A) the NCA battery in Model S has 300-
The cycle life range of 600 and the new \"21-
The 70 \"version of Model 3 has twice the range.
(B) Powerpack battery packs below 2,000-5,000 cycles.
Then there is Megapack, the battery unit that should power 1 in the plan.
2 GWh installation in California (shared construction project ).
What is the cycle life of that one?
It will take advantage of different Li-ion technology?
Note: When we State 300 charge/discharge cycles, we are referring to the full cycle.
So, for example, when your Model S is charged by 70%, you re-charge
Charging to 100% does not constitute a complete cycle. Re-
Charging from 0% to 100% is a complete cycle. Of course, Li-
The ion battery is not expected to be fully discharged (this will damage the battery ).
Finally, please allow me to remind you that the forecast is based on some assumptions that may prove to be wrong.
Think about the contents of these forecast Li-reports/charts
The price of ion batteries will continue to decline until 2030: raw material price, competitive technologyg.
New battery type or new chemical mixture), recycling capacity (raw material prices will not drop if recycling is still unprofitable), government subsidies, etc.
Who can really know how these components will play 5-
After 10 years?
So make sure every 6-if you invest in Tesla-12 months.
Review your paper if the assumption is no longer valid.
In order to avoid confusion, let me prepare for your next thing.
We will discuss various alternative batteries first (Alt 1-
This will compete with Tesla\'s Powerpack business.
After that, we will
Evaluate whether Elon made the right choice (using Li-
Ion technology ).
Elon Musk believes that the future of large-scale energy storage will be mobile batteries.
However, the company he manages is fully invested in Li
Ion battery technology
Elon knows that it will be difficult to purchase vanadium oxide because only a few countries have reserves.
Of course, his plan is to monopolize a battery type that can be used for mobile and fixed purposes.
Therefore, the vanadium redox flow cell is not an ideal choice.
In any case, the vanadium redox mobile battery type competes directly with Tesla\'s Powerpack business.
Of course, it is not technically (the two batteries have different properties), but is related to the energy storage market as a whole.
That is to say, VRFBs will eat part of what would have been invested in Li-
Ion storage solution.
(1) features (specifications etc) so, let\'s start with the \"neutral\" feature of the VRFB: Now let\'s talk a little bit about the negative features (no deals-
Finally, we should also be aware of the positive features of VRFBs: Please note that there are other features, but we will not mention all of them in this article.
(2) before we talk about the planned and already operational VRFB project, please allow me to remind you that the demand (growth) is directly related to the price of the installation/packaging.
Earlier, when we discussed Lee
Ion batteries a little bit, we recognize that the cost of installation will only drop slightly.
So, reviewing the cost of the battery (or battery pack) depends on what is wise: So, as you understand, tracking the potential cost development of the battery can be very challenging.
This is especially true when the chemical mixture is constantly changing.
An example of this is Tesla\'s ongoing efforts to reduce the amount of cobalt used in batteries.
When a chemical mixture changes, the \"sensitivity\" of the battery to certain raw materials (price fluctuations) also changes.
This statement basically proves that the prediction of this problem is still theoretical and extensive and therefore neither objective nor reliable.
Write this down. (3) Geo-
Economics: China is winning war for the future. There are several \"large\" VRFB projects in operation: The grid battery attached to the Tomamae wind farm (2005) in Japan caught my attention, especially since the state is in the NaS Battery (sodium sulfur battery, sodium and sulfur) invested a lot of money.
After 2000, NaS battery technology has made considerable progress around the time the above-mentioned VRFB was installed and built.
So the question now is: Did Japan give up the vanadium battery because the technology is not so promising?
Note, however, that the raw materials (sodium, sulfur, ceramics) needed for NaS batteries can be easily obtained in Japan, rather than vanadium oxide.
We will discuss the NaS Battery in detail later.
The good news for the chemical energy storage business is that the big project is finally starting (vanadium-and lithium-based).
Major investors include the United States, Japan, Australia and China.
China, in particular, has already planned quite a few projects.
It is currently building the world\'s largest 800 MW vanadium redox flow battery station.
It is \"larger\" than Tesla\'s ESS (129 MWh) in Australia, but \"smaller\" than the planned 1 \".
Two GWh projects in California.
Of course, the last two projects areion battery-based.
Now, the project (800 MWh VRFB installation) has been undertaken by Juncker power, which has built the batteries into containers.
Organizing packaging into containers can reduce shipping and installation costs.
Unfortunately, according to Mastermines Research, the construction of the project will be postponed until 2020 (initially planned to be completed by the end of 2018 ).
Therefore, China will not be the world\'s largest chemical (battery) energy storage facility.
But it seems to have the upper hand in addressing the raw materials needed for the energy revolution.
(A) in the first part of this series, I mentioned that there is A second one in China
Lithium reserves are the largest (after Chile ).
However, it is also the first in terms of vanadium reserves.
Fortunately, the new \"alliance\" between China and Russia\"
The largest vanadium reserves are being rewarded.
These two countries can form an OPEC of vanadium to manipulate prices for their benefit.
(B) but more.
Russia also produces nickel and aluminum.
(C) about 10% of cobalt (global productivity) was produced in total in China and Russia ).
(D) Turkey, Russia\'s \"latest ally\", has the largest reserves of graphite.
China has a third
It is currently the world\'s largest producer of graphite.
So the Asian giant can get all the necessary raw materials, bring about a revolution in energy storage and export them to Europe (partly to Japan ).
Competing countries should generally target China\'s energy imports (China\'s oil reserves are exhausted and natural gas is mostly deep shale gas), but it will be difficult to manage
Diversified imports ).
Taking Russia away will be a more realistic strategy.
In this case, of course, \"reality\" is a relative term.
There has always been an \"energy problem\" in Japan: there is a lot of demand, but there is limited domestic production.
Therefore, waste of energy is particularly \"expensive\" and it is very important to use efficient batteries.
This country has been testing vanadium.
Battery of the past.
But this type of battery has (or at least has) a relatively low efficiency and is less effective when \"connected\" to the grid (without instant reaction time.
So Japan had to look elsewhere and its scientists came up with an acceptable alternative: NaS batteries (Na = sodium, S = sulfur ).
It\'s really interesting to know that Ford is the pioneer of this battery.
Back in the 1960 s, car companies tried to produce an electric car powered by a NaS Battery (Elon was not the first person to dream of an electric car for the masses ).
The project failed, but Japan later developed a fixed energy storage capability using the knowledge generated.
* The link above is an interesting read as it was written in 2011. Back then, Li-
It is believed that the ion battery has not been able to supply power for a long timedistance EV.
This is a good example of how rapid and unpredictable technological advances are.
This proves how reports and forecasts are developed in this industry.
There are a lot of battery types currently under development.
No one knows when the next break will happen (and no one knows which battery it is ).
Write this down.
Now the NaS battery is very efficient and can store a lot of energy.
They also have a long cycle life.
Here are some important features: the latter feature is also a major hazard problem for a fixed energy storage device.
It is reported that a fire broke out in a NaS battery unit in Japan.
Since then, there have been fewer and fewer new projects.
In short, however, let\'s point out that currently the NaS battery is only available for fixed/grid applications (not mobile applications ).
In addition to Japan, the United States and other countries are also operating some radio stations.
But, as you can see on the chart, the installed capacity in Japan is by far the largest --
Operate 167 sites.
An example of a well
The famous NaS battery construction company is NGK.
Now, there have been many developments over the years.
Both the United States and Japan. g.
Claims sought to reduce the operating temperature to around 100 °c (claims were filed on 2009 and 2010, respectively ).
A recent breakthrough at MIT has made NaS batteries more resilient.
In contrast, the NaS battery seems to be in line with the Powerpack\'s NMC Li-
Ion technology, and VRFBs.
Although the latter type of battery (VRFB) is not flammable and does not explode (overcharge), the cycle life of the NaS battery is as long as it has instant reaction time (such as Powerpack), the larger the project, the cheaper the price is.
As a result, NaS battery technology could be a threat to Tesla\'s Powerpack.
Now, however, Li
Ion batteries are still \"King\" because they are balanced in all aspects (cost, cycle life, reaction time, energy density, efficiency.
So far, we have covered all kinds of pure chemical batteries.
But what about the battery mixture?
I\'m pretty sure you guys have encountered capacitors at least once in your life.
They are everywhere, even on your computer.
The super capacitor (also known as the super capacitor) is a stronger breed that theoretically can power electric vehicles at some point in the future.
Super capacitors have promising features: they last for a long time (cycle life), can be charged almost instantly and can withstand a wide range of temperatures.
They don\'t explode, they don\'t. inflammable.
Their energy density is very low, but the power density is very high.
To understand what this means, imagine them as small bottles with a large opening
The ion battery is like a large bottle with a small opening.
The latter lasts longer and can store more energy, but the super capacitor can discharge in an instant.
They work almost like a camera\'s flash and instantly give off a constant glare.
This feature (huge power burst) makes the Super capacitor a qualified candidate for weapons.
In fact, China is already developing a powerful laser weapon.
Super capacitors are used in power grid networks but cannot be used for large-scale energy storage (they manage power output ).
Combine them with lead
However, this is being changed by acid battery technology.
This type of battery is called a super battery and several energy storage projects are already running.
Super slaughterhouse is almost as efficient as Li
Ion battery (90-94%).
For mobile purposes (EVs) and utility purposes, they have a cycle life of far more than 260 cycles and are \"running\" longer.
Let\'s also talk about price sensitivity.
When demand for Li
With the rise of ion batteries, a lot of investment is required to increase the output capacity (still more investment is needed ).
These investments need to be \"repaid\" at some point, which means
As we move forward, the price of ion batteries has dropped more slowlye.
Producers will need to sell Lee-
Pay for the ion battery that invests \"cost\" at a higher price ).
Higher requirements for Li
Ion batteries have also raised demand for more raw material output capabilities.
This expansion brings fluctuations in the prices of lithium, cobalt and other metals (due to supply fluctuations), which will again reduce the rate at which the price of the battery will decline (the company will set the margin of safety, in order to keep the minimum profit at all times ).
Super slaughterhouse leading-
100% recyclable acid base.
This means that the price of related raw materials will fluctuate less, because more indirect supply will be generated. used).
While demand for the super slaughterhouse may increase dramatically, basic capacity (production facilities) has been identified. Lead-
Acid batteries have been around for a long time and no additional capital is needed to increase production.
Nevertheless, I personally think that the Super Battery may not compete with other types of mass energy storage batteries (Li-
Ion, flow for large projects ).
Instead, they will focus on small-
Scale storage project (2-
3 container packaging and power for traditional cars (ordinary batteries), hybrid cars and electric motorcycles.
All electric cars are good at the moment. covered by Li-
Ion Battery Specifications
All in all, the future of the battery seems to be mixed.
We already talked about Super batteries.
Acid Battery), we also have Li-
Ion super capacitor
Ion batteries), although there is no real comparability between the latter and the former (not actually a chemical battery mixture ).
Also tested the flow battery with the super capacitor, but Li-
Due to the coupling of high energy density and high power density, the ion mixture should be the most interesting form.
The future may look very bright: instant charging capability, huge power density, theoretically infinite cycle life and huge energy storage capability.
There should also be no danger of explosions and inflammation.
The friendliness of the battery type to the environment will depend on the level of recyclability.
Currently, only leading-
Acid batteries (and so does super batteries) are truly recyclable.
I mean, the process of recycling batteries is a profitable business venture (the company that recycles LA batteries is profitable ). Li-
Ion batteries can be recycled up to 97%, but (currently) the process is not profitable.
However, this may not be the case for Tesla. Tesla is a company that recycles its own batteries.
Although there are more and more contestants, for e. g.
We will not discuss Proton and rechargeable aluminum batteries.
However, our investors need to be vigilant about any new development and battery type (especially the mixture.
Things may grow faster from now on, as the world is ready to invest in the energy storage revolution and the battery revolution.
As for Tesla, it seems to have made the right choice in terms of NMC fixed/grid battery technology (not LFP.
Musk has been tracking the market, and NMC mix is covering the \"middle zone \"--i. e.
Effective (cost and utility) compared to other battery types ).
This will enable his company to take a bigger share of the energy storage market.
So, \"he knows what he\'s doing \".
In essence, however, all three batteries mentioned in the table below (Flow, Li-ion, Lead-
Acid) will \"survive \".
Each of them has its own purpose/market (big-
Scale energy storage, power grid auxiliary/backup-up power/mid-
Small energy storage, smallscale back-up/small-
Scale energy storage ).
Together they provide a complete energy storage package.
The Super slaughterhouse will take over at some point.
** The price and cycle life range is an extensive assessment.
NaS batteries and other types of batteries are competing for these 3 broad levels/utilization (depending on specifications.
Now, according to IRENA, prices are expected to drop by 30-
By 2030, 50% per type.
But keep in mind the predictions we are talking about: too many moving parts, don\'t trust them.
In addition to its competitors, Tesla will compete with the whole country.
Different countries around the world seem to have different views on which battery type: there is the same \"deviation\" (part) for electric vehicles ), various car companies around the world are betting on NCA, LFP, hydrogen cells, LPG, and even mobile battery technology to power cars.
This is great because diversity and competition will accelerate the energy and battery revolution.
Excellent technology will be the industry leader.
The advantage depends not only on the cost ($/kWh), but also on the overall specifications and capabilities.
Tesla has proven it\'s a \"front line\" many times before --
When it comes to cost, runners
Benefit (cost utility ).
It has expanded its Powerpack business faster than other companies and is now working with many countries.
However, it is very important to remember that the Powerpack business is still developing (slowly) and therefore cannot \"carry\" the Tesla organization.
The potential of the electric vehicle business (revenue) is a factor that investors take into account in justifying the company\'s huge debt (high leverage) and stock dilution rates.
All of this money is spent on expansion (new production facilities) and R & D (batteries ).
The slowdown could be bad for companies.
The same is true of profits because it needs to continue to create profits.
What\'s next: in the next section, we\'ll discuss Tesla\'s secondary business potential (Powerpack, Powerwall, Solar, Leasing and other subsidiaries) as a whole)businesses).
After that, we will delve into the financial situation of the company.
Disclosure: I/we have no positions in any of the stocks mentioned and no plans to start any positions in the next 72 hours.
This article was written by myself and expressed my views.
I have not received compensation (except for Seeking Alpha ).
I have no business relationship with any stock company mentioned in this article.