Here’s an extract of our conversation about Tesla’s new battery storage products:
Alison van Diggelen: Tesla has a big announcement next week about batteries. Of course, I’m not going to ask you to preempt Elon Musk’s announcement…but give us the case for battery storage. Why is Tesla going into battery storage for the home and utility scale?
Steve Jurvetson: This may be the first peek into a unified theme across companies. So as people know, Elon Musk is an incredibly prolific entrepreneur, having come up with, or been at the founding team of Tesla, SpaceX, SolarCity, PayPal, all different industries that seem to have nothing to do with each other.
Now the troika of perhaps SolarCity, and the Gigafactory (which is an incredible initiative underway in Nevada right now), and Tesla comes into light for the first time: There is synergy. Say 20 years out, there’ll be a distributed utility where Solarcity has the solar cell installation, leasing and basically ownership, installation and the whole shebang, actually building panels as well for solar on homes, everywhere.
Well, once you get enough of that (last I checked they have around 40% market share in the US) you start to generate so much energy that you are like a variety of utilities combined, but it’s ephemeral. If you’re not using that energy when generated, it goes away. So right now, you push it to the grid and it’s expected the utility can use it, especially since solar is produced at peak hours. But what if you wanted to get rid of the grid altogether? You’d need distributed storage …if every solar cell came with a big battery that could smooth out your daily needs, then you could just disconnect from the grid. You could certainly lower the generation capacity of the grid…that pushes on fossil fuels and nuclear.
How to pull that off? As a customer of Tesla and SolarCity I see my solar cells and I see my car and think, can’t we just connect these together? If I need to suck energy out of my car, I can use it to buffer the load from my cells, but it’s not so easy…
Part of the synergy and leverage is that Tesla is planning to build an enormous plant of batteries, anticipating the 3rd generation vehicle…you’re going to have some excess capacity, potentially for some period of time as you ramp up.
There will be blocks when you produce a lot more batteries than you might need in that particular month…well what are other interesting things you can do with them? What would you do with those batteries at the end of life of a car? Those battery packs are really useful for secondary storage uses.
For folks who don’t know this…the Gigafactory isn’t named that just out of hubris. It would be the largest factory in the world by footprint and they’re going to eventually build many of them. That one factory alone at scale would exceed global capacity today. So this is an unfathomable amount of batteries.
I really have to credit Elon for realizing that these numbers pencil out to be so enormous and to share that with the world, before he had the solution in the bag.
van Diggelen: Talk about the utility scale side. If you were a utility…in charge of PG&E today, talk about how you’d be feeling and what you might be doing to deal with this?
Jurvetson: On the one hand, you’re threatened by solar and you’re going to do all your dastardly deeds to try to quench and kill innovation, because that’s what big companies do, it’s in their blood. That’s what they’re expected to do.
But on the other hand, they need this too because whether by mandate or the goodness of their hearts…so mandate…they do more wind, do more solar. Many of those wind farms you see, on Pacheco Pass, they’re not doing anything useful. They may be spinning but they’re not even hooked up sometimes. There are rules and regulations to generate the capacity but not to actually make use of it. So part of the problem with time shifting is you have different needs at different times, wind is often a nighttime peak, so storage is needed throughout to pump water…there are all kinds of things you can do….in demand response. There’s a lot of inefficiencies in the utilities where they’ll build peaking gas fired power plants that are just turned on for a few hours in the year at most for those peak needs. So all that infrastructure just because you couldn’t do needs sharing or have the capacity to buffer.
If you had big old battery sitting there on the grid, you wouldn’t need that. So distributing that allows you to put it near the point of consumption and point of generation in a solar context.
van Diggelen: What are the markets for these utility scale batteries? Would it be companies like Apple that are going solar in a big way or is it to sell to PG&E?
Jurvetson: Good question. In general, there’s a whole cascade of markets: everything from consumers for their home, businesses and utilities themselves. The utilities can go to all kinds of technologies, even Telcos like for a cell phone tower you need storage there as well, especially in places like India and elsewhere.
There are technologies like flow cell batteries, compressed air solutions being developed…there is a variety of ways to approach this. Tesla’s approach is just leveraging what they know best which is lithium ion chemistry and batteries and a battery management system…so you can potentially address a whole range of these.
van Diggelen: So it’s the same batteries they use in their car?
Jurvetson: Exactly…
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Check back soon for more highlights from the Steve Jurvetson interview.
In this exclusive Fresh Dialogues interview, former Energy Secretary Steven Chu shares his reaction to Obama’s major speech on climate change; explains how a carbon tax will drive U.S. competitiveness; has a message for climate deniers; and even shares tips for being more energy efficient in the kitchen. When did you last get cooking tips from a Nobel Prize winning physicist who’s been described as the One Hundred Billion Dollar Man? It’s time to listen up folks! It’s time to listen up folks!
“This is a real issue. We have to do something about it!”
When asked if he wrote or was involved in writing the speech, Chu joked that he has ‘been involved’ for 4 1/4 years and recently regaled several heads of state (including President Obama) with his powerpoint pitch for raising appliance efficiency standards, reminding them that “there’s money to be made…and saved.”
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On Carbon Tax
“A carbon tax must be non-regressive and revenue neutral. It will drive efficiency…competitiveness. Educating the public (on climate change, energy policy) is very important, but it’s about economic opportunities and (creating) a growth market. Change will be partly market driven.”
On Climate Change Deniers
“I’d put them in the same category as people who said, in the 60’s and 70’s, that you haven’t proved to me that smoking causes cancer.”
On Chu’s vision for distributed energy
“Distribution companies partnering with the private sector have the opportunity to access fairly inexpensive capital and be part owners in distributed power and energy storage in benign environments, like inside a home or building. When you do that, the price of electricity will go down (3 to 4 times). All of a sudden utility companies will be in a growth business…Utilities should wake up and see there’s money to be made!”
Chu cited the advantages of black-out reduction thanks to demand control; and underlined the multitude of opportunities that low-priced software and sensing equipment offer.
On Cooking with Chu
Tip #1: “If you’re boiling a pot of water: if you put a lid on it, it comes to boil much more quickly.”
Tip #2: “Pick the right sized pot, don’t pick a pot five times bigger, twice as big.”
– Steven Chu, Nobel Prize winner in physics 1997, Former Energy Secretary, 2009-13.
No word yet on whether Steven Chu is planning to give up his new job at Stanford University for a prime time cooking show…Though we hear there is an opening.
The interview was recorded at the Silicon Valley Energy Summit, presented by the Precourt Energy Efficiency Center, Stanford University on June 28, 2013. Photos by Lina Broydo.
The Economist newspaper has a reputation for world-class reporting, with a sardonic British twist. Is the publication bullish about green innovation? I sat down with Martin Giles, the Economist’s US Technology Correspondent last week to get his global perspective on green innovation and the greening of Silicon Valley tech companies. Giles conducts interviews for the delicious Tea with the Economist series and other high profile conferences, but when the tables were turned, he didn’t disappoint. In this Fresh Dialogues interview, we talk GREEN, from data centers to smart grid; and green jobs to political bluster.
Is GREEN and sustainability important to tech companies today?
“It’s definitely on everybody’s agenda. It’s an opportunity to save money. If we can find ways of powering our server farms…our production lines more efficiently, we can save money and do a favor to the environment. That’s a win-win.”
What lasting green trends are happening today?
“E-waste is a big issue…How do we create products that don’t leave a massive footprint on the environment?”
“Smart grid… It’s classic Silicon Valley – it’s technology on the one hand and power on the other…let’s bring them together and create a whole new paradigm.”
On November 17, I attended the CleanTech OpenAwards Gala at the Masonic Center in San Francisco and enjoyed keynotes from Lesa Mitchellfrom the Kaufman Foundation, Bill Weihl, Google’s Energy Czar and Nancy Pfund, of DBL Investors.
Minutes after his company was picked as the National Award Winner. I sat down with Scott Hublou, co-founder of EcoFactor. His three-year-old start-up has created an energy management systemfor the home that uses weather data to optimize heating and cooling. Scott claims savings of between 20 to 30% are achievable. Sounds pretty attractive in this tough economy, and the judges thought so too.
How did the CleanTech Open and its mentoring help you?
“It forces deep thinking around various different business models. Because there are actual deadlines, it’s kinda like being back in school again where you have to have deliverables… You’re presenting to your peers and potential investors, so you always want to make a good impression… think about sustainability, and good market strategies.”
Matthew Smithof Greenbox, a maker of web-based energy management systems for homes, sat down with me at the company’s San Bruno based headquarters to discuss how his team plans to change our energy consumption habits, save us money and save the planet. By providing an “energy dashboard” for homes, he claims the company offers consumers the potential to reduce electricity bills by 10-15% by taking small, easy steps. (more…)
On Cooking with Chu
