“All the breathless coverage of Elon Musk’s Powerwall battery brouhaha last night is missing the most important thing: a sober discussion of real-world costs,” Christopher Helman writes for Forbes. “So let’s take a look at the costs and see if this world-shaking, game-changing innovation really makes any sense.”
“Musk said Tesla’s 7 kwh capacity battery would cost $3,000, while the 10 kwh capacity one would be $3,500. (That doesn’t include the cost of an AC-DC inverter – about $4,000 — plus professional installation),” Helman writes. “The implication is that a 10 kwh system could supply 1,000 watts of current to your home for 10 hours… So how much is that battery power going to cost? Setting aside for a moment the cost of making that electricity in the first place, let’s look at just the cost of using the battery to store it and get it out again. Researcher Winfried Hoffman, the former CTO of Applied Materials AMAT +1.62%, has done some interesting work on the falling costs of battery power. He figures that for a lithium-ion system with an initial installation cost of $400 per kwh capacity, 80% efficiency and ability to run 5,000 cycles, the average cost of stored electricity will be 15 cents per kwh.”
“To get your real electricity cost, you have to add to that 15 cent battery charge whatever you’re paying for that electricity in the first place… Adding together your 15 cents per kwh for solar power plus the 15 cents to cycle a kwh in and out of the battery, and you’re looking at 30 cents per kwh for electricity. I think 30 cents per kwh is bonkers. At my home in Texas I pay 10 cents per kwh to Reliant Energy for electricity that is mostly generated by natural gas burning power plants,” Helman writes. “Unless your solar-powered home is entirely disconnected from the grid, an expensive battery backup system like Powerwall does not make economic sense.”
Read more in the full article here.
MacDailyNews Take: So, who’s buying a Tesla Powerwall unit?
Tesla CEO Elon Musk reveals Powerwall home battery – May 1, 2015