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Comment by _ea1k | Hacker News Reader

During the trial its $2/kwh. A powerwall costs ~$10.5k for a single unit with a capacity of 13.5KWh. You'd need to do 5MWh to pay for the powerwall, and that would be ~370 cycles.

The pack should be good for over 1k cycles. This is definitely a beneficial thing for the owner at these prices.

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For reference:

https://www.tesla.com/sites/default/files/pdfs/powerwall/pow...

If it's being used for solar-piped home backup it's covered for unlimited cycles, and for any other usage they rate it for 37.8 MWh of lifetime AC output.

Now, I don't see anything talking about the Powerwall's warranty within this article explaining Tesla VPP, so whether or not this might be considered when they determine warranty eligibility is anyone's guess.

I would think that just charging $2/kWh during peak time would be enough to bring down peak load without using any batteries.

Well, yeah, probably. You'll also make a lot of people unhappy

$2/kWh is very expensive. I guess by paying the powerwall users you can limit how much you spend with them. Not sure with how much local granularity can you turn them on, but it definitely helps

How can they pay powerwall users $2 if they're not actually charging $2?

Presumably most of the time they are charging end users more than they are paying energy providers.

By amortizing that across off-peak pricing?

By not having to build more power plants or not putting the battery equivalent of all the power walls.

Also, I imagine this is to get the power wall users 'hooked'. Then over next few years that $2 will turn into 20 cents.

This isn’t actually unique to powerwall users - this is a program for energy providers to supply emergency power. There’s a minimum amount of power needed to be eligible and a powerwall is too small. Tesla realized that they have the unique ability to manage a fleet of small batteries to act as a single large one to qualify.

Will the price go down in the future? Maybe. Is this a gimmick to get people hooked? Probably not, assuming Tesla isn’t paying end users more than they make to join in.

And hope that won't realize they're destroying their battery without enough compensation?

You're buying the bare minimum to stabilize the grid and you're buying it "delivered" already

Only if people reacted to it reliably and predictably, which generally at the moment they can't.

So they're being paid not just for not using this power at that moment, but being part of a system of "demand response" that lets the grid plan ahead and modulate demand.

They also do this with people's AC and various large industrial energy users.

But, time-of-use rates are a currently underutilized idea, and with greater computerisation, you can get more and more value from this on short-timescales.

You want to start with the low hanging fruit first, and EV chargers are that easy win as they are being installed now.

> But, time-of-use rates are a currently underutilized idea

Is it not normal in the US to pay less for electricity at night and on weekends?

That's very common in the places (Netherlands and Switzerland) where I've lived, for as long as I can remember, and seems much more low-tech than using consumer batteries to supply back to the grid and paying them a custom rate.

It's still 'controversial' and little used in the US:

https://www.utilitydive.com/news/an-emerging-push-for-time-o...

> A new idea is to vary the price of kWhs, making the price higher for residential customers during peak demand, and lower at other times, allowing for more precisely pricing kWhs at what they cost.

> With today's flat per-kWh rates, "customers who use the grid more during peak demand are underpaying for the costs of meeting that demand," Brattle Group Principal Ahmad Faruqui told Utility Dive. "Customers who use the same kWhs during off-peak times pay the same bill and are subsidizing the others. TOU rates can redress that inequity."

The quotes drive home why it is "controversial"; because generation and transmission companies see it as a potential way to improve revenue, not as a way to improve the grid.

I will assent to these powerful features when there is a strong legal guarantee that it will be used to improve the world, not to juice up someone's q2 numbers by charging me more.

Remember that these are the same companies that by and large lobby against being able to sell solar power back to the grid.

> lobby against being able to sell solar power back to the grid.

Worse, they lobby against residential solar as a whole. I could install enough solar panels & batteries to cover 100% of my needs through the year, but unless I disconnect from the grid completely, I'd still pay about half of my current electric bill, without using any electricity from the grid. The utility company with local monopoly is specifically making sure as little residential electric is installed as possible.

In San Diego, we get to choose whether we want to opt into the time-of-use pricing, or whether you want to pay based on the traditional flat-rate tiered pricing (where your monthly consumption is compared with your neighbors to determine your price per kilowatt).

It sounds fancy and pro-consumer, but in reality, we have some of the worst rates in the nation. Jon Oliver even did a recent bit about how ridiculous it is. (Search for "Jon Oliver SDG&E".)

Also the 1k cycles is until the pack capacity goes down to 80% of the original. You could still use the pack well past that unless tesla somehow limits it or complete short of some of the elements in which case you should be able to replace the element.

TBH, I think it goes well past 1k even for the warranty. Someone else pointed out that its closer to 2,800. I wasn't sure, so I picked a conservative number.

How long will the trial prices last? $2/kwh is insanely high; usually the wholesale electricity prices hover closer to $0.02-$0.04/kwh, although the recent gas price increases have disrupted that for now. The war in the Ukraine is not going to last forever though, and if gas prices remain this high we might see an accelerated transition to non-fossil based electricity generation.

At $0.20/kwh, so prices 10x above "normal", you'd need 3.7k cycles to pay for the powerwall. That would be well above the lifespan of the pack, so at lower prices the profitability of the scheme (to the owner of the pack) falls off rapidly. I suppose it all depends on how long you estimate the trial pricing will last. TFA mentions in the fine print that this project "shall continue until at least December 31, 2023, unless expressly extended by PG&E or terminated sooner." Take from that what you will.

Peak pricing is much, much higher than the prices you quoted and in the ballpark of the trial. E.g. before the 2021 Texas outage the offer price for additional power was the legal cap, $9 / KwH at the time.

Peak pricing is indeed higher, but also much rarer. Prices of $2/kWh are reached extremely rarely, so the VPP in this scheme might only be operating once or twice a year. The calculation in the GPP about payback time for the powerwall assumed you could get a lot of cycles in, but at these elevated prices that seems unlikely to happen. Note btw that the $2 is flat, so even if prices reach $9/kWh you'd still only get $2/kWh back.

I notice that the article does not include any expectations about how often the "events" would happen btw, even though the utilities would surely have enough data to at least make an estimate.

The payback calculation was a direct reply to the concern that VPP use will wear out the battery too fast. The only reason it was done was to show that if VPP would trigger often enough to meaningfully harm the pack, it would also pay you more than enough to replace it.

In practice, VPP will be rare, and thus the payouts will be low. But so will the harm caused to you by participating, assuming you already own a suitable system.

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