Tesla’s ‘virtual power plant’ in SA still alive after government official takes softer stance

Tesla’s proposed 250 MW/650 MWh virtual power plant for South Australia could still push through, as newly-elected premier Steven Marshall took a step back from his hardline approach and adopted a softer stance on the energy project.

In a recent statement, Marshall assured his constituents that existing renewable energy contracts from the previous administration, such as the Tesla SA virtual power plant, would not be unceremoniously discontinued under his government. With this in mind, the first two stages of Tesla’s plan for the virtual power plant, which involves the installation of solar panels and Powerwall 2 batteries to the first 1,100 homes in the network, could still proceed.

According to a report from Australia-based publication Renew Economy, Marshall’s change of heart with regards to Tesla’s virtual power plant appears to have been affected by the backlash he received after announcing that the project would “not be part” of his administration’s agenda. Spoken just before he was sworn into office, the brazen statement incited a lot of strong reactions from SA citizens, especially in social media.

A simple social media tally from the publication’s Facebook account, for one, showed that 88% of the social network’s users who reacted to the article gave a negative response to Marshall’s statements on Monday. The vast majority (73%) who responded to the news through Facebook even expressed outright anger at the premier’s comments.

Marshall’s bold statements on Monday expressing his lack of support for Tesla’s 250 MW/650 MWh virtual power plant appeared to be a knee-jerk reaction due to his political affiliation. On Monday, Marshall, who is from the Liberal Party, seemed to take an overly critical and dismissive stance on programs that the previous Labor-led government started, including plans that would benefit the region’s citizens.

As we noted in a previous report, Marshall wanted to replace Tesla’s virtual power plant plan with a $100 million government subsidy for 40,000 residential units. Under Marshall’s program, residents who already have solar panels installed in their homes would receive a $2,500 subsidy for home battery packs. Overall, the newly elected premier’s project would involve an upfront investment — something that Tesla’s target demographic for its ambitious initiative would likely not be able to provide.

From a financial standpoint, Tesla and the previous administration’s proposal for the 250 MW/650 MWh virtual power plant seems like a far more practical choice for the government. The virtual power plant’s upfront cost, which includes a $2 million grant and another $30 million from the Renewable Technology fund, after all, is lower than the $100 million that the government would have to invest in Marshall’s proposal.

If completed, the South Australia virtual power plant could provide about six times more energy than Tesla’s 100 MW/129 MWh Powerpack farm near Jamestown. Due to the aggregated design of the virtual power plant, the 50,000 households in the network could not only store power for themselves; they could also provide additional grid services when the need arises.