The clock started ticking for Tesla on Friday to complete what will effectively be the world’s largest battery — a 100 MW/129 MWh Powerpack installation in the Australian state of South Australia. And to adhere to its commitment of completing the installation in 100 days, the Elon Musk company has chosen Samsung over long-term partner Panasonic to supply the battery cells for the massive facility.
On July 6, Tesla announced it had won the bid to install the energy-storage system in South Australia, which began looking for a source of power backup after storms in September 2016 caused state-wide blackouts, leaving its 1.7 million residents without electricity. One of the clauses in the agreement signed between Tesla and South Australia was based on a claim Musk made before bidding for the contract: the company would set up the facility, worth $50 million, in 100 days or make it free.
Terms of the agreement also stipulated the 100-day period would start “once the grid interconnection agreement has been signed.” And that happened Friday, when “Australian Energy Market Organiser and South Australian transmission firm Electranet signed an interconnection agreement to install Tesla’s Powerpack battery system,” the Sydney Morning Herald reported.
Half the installation is already complete, however, and Tesla would be in a position to hand over the facility in an operational state by Dec. 1, instead of needing the full 100 days, the report added.
Musk, who was in Australia on Friday — to talk about his Mars colonization plans and using SpaceX rockets for fast commute on Earth, among other things, on the last day of the International Aeronautical Congress 2017 in Adelaide — delivered a speech near Jamestown in South Australia. That is the site for Tesla’s battery facility, where it will be paired with a wind farm being constructed by French company Neoen.
“This is a great example to the rest of the world of what can be done,” Musk said in his speech, praising the state government for promoting renewable energy. “When this is done in just a few months, it will be the largest battery installation by a factor of three,” he added.
Despite having a somewhat comfortable margin, Tesla will need to nonetheless make sure it can supply the battery cells quickly, and for that reason, it has — for this project — abandoned its long-term supplier Panasonic, choosing Samsung subsidiary Samsung SDI instead, the Nikkei Asian Review reported Saturday.
The Japanese company is busy supplying battery cells for Tesla’s electric vehicles, and as Tesla expands its power backup business, it could mean more of its orders going to the South Korean company, which has excess capacity, in the future.
Tesla will first import the battery cells into the United States, and manufacture the Powerpacks at its Gigafactory in Nevada.
At the close of trade Friday, Tesla’s shares were up 0.44 percent on Nasdaq, slightly underperforming the Nasdaq Composite index that was up 0.66 percent. Shares of Panasonic also closed 0.25 percent higher on the Tokyo stock exchange, outperforming the broader Nikkei 225 index which closed Friday 0.03 percent lower. Samsung SDI was the poorest performer among the three companies Friday, down 0.75 percent on the Korea Stock Exchange while the broader Kospi index was up 0.9 percent.