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CLIMATE ACTION PROGRAMME

5 February 2018

Tesla to build a virtual solar plant in South Australia using 50,000 homes

Aiming to be the world’s largest virtual solar plant, the state government of South Australia has partnered with Tesla to roll out a network of at least 50,000 home solar and battery systems.

Each participating household will be equipped with a 5Kw solar panel installation and a 13 kWh Powerwall 2 storage system.

In total, the virtual power plant will have an installed capacity of 250 megawatts (MW) and 650MWh of storage.

The project will end up being about 50 times larger than initially proposed in 2017, and will be about 3 times the size of the rest of similar plants around the world.

A virtual power plant works by taking a large number of solar panels on individual households and integrating them for the benefit of these consumers to lower the cost of their electricity.

The 250 MW added capacity to the system is expected to improve competition across the market and generate savings of $190 million for all consumers whether they participate to the project or not, according to an analysis by Frontier Economics, a European consultancy specialising in microeconomics.

For the households participating in the project, the virtual plant is anticipated to reduce their energy bills by 30 percent.

Danny Price, Managing Director of Frontier Economics, commented: “South Australia is definitely leading the way in developing a 21st-century power system ahead of everybody else”.

Initially, the plan will be rolled out with a trial in 1,100 social housing properties. Following the trial, which has already launched, solar energy systems will be installed in a further 24,000 Housing Trust properties with the plan being for at least 50,000 households to participate in the initiative within the next 4 years.

Members of the public who are interested in participating in the programme are invited to express their interest.

What is even more exciting is that participating households will share no expenses either for the solar panels or the storage system. The system will pay itself through the sale of electricity.

“My government has already delivered the world’s biggest battery, and now we will deliver the world’s largest Virtual Power Plant”, the South Australian Premier Jay Weatherill has said.

He added: “Our energy plan means that we are leading the world in renewable energy and now we are making it easier for more homes to become self-sufficient”.

The project will cost roughly $800 million. For the initial phase, the government of South Australia will provide a $2 million grant and a further $30 million as a loan whilst it seeks additional investors. 

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