Tesla’s Big Battery, located in southern Australia, just got hit with a federal lawsuit for failing to provide the crucial grid support it once promised it could.
Built by Tesla in 2017, the 150-megawatt battery supplies 189 megawatt-hours of storage and was designed to support the grid when it becomes overloaded. Now operated by French renewable energy producer Neoen, it supplies storage for the adjacent Hornsdale wind farm, using clean energy to fill gaps that coal power leaves behind. It made waves at the time of its construction for being the largest lithium-ion battery in the world—though it’s now been superseded by another Tesla battery, the 300-megawatt Victorian Big Battery, also in Australia, which caught fire in July.
On Wednesday, the Australian Energy Regulator (AER), the body that oversees the country’s wholesale electricity and gas markets, announced it had filed a federal lawsuit against the Hornsdale Power Reserve (HPR)—the energy storage system that owns the Tesla battery—for failing to provide “frequency control ancillary services” numerous times over the course of four months in the summer and fall of 2019. In other words, the battery was supposed to supply grid backup when a primary power source, like a coal plant, fails.
The HPR’s alleged pattern of failures was first brought to light during a disruption to a nearby coal plant in 2019, according to the regulator. When the nearby Queensland’s Kogan Creek power station tripped on October 9, 2019, the HPR was called on to offer grid backup, having made offers to the Australian Energy Market Operator (AEMO) to do so.
But the power reserve failed to provide the level of grid support that AEMO expected, and, in fact, was never able to do so in the first place, the lawsuit alleges, despite making money off of offering them. Though HPR did step in eventually, and no outages were recorded, the incident spurred investigation into a number of similar failures over the course of July to November, 2019. The reserve’s failure to support the grid in the way it promised created “a risk to power system security and stability,” a press release on the lawsuit says.
“Contingency FCAS providers receive payment from AEMO to be on standby to provide the services they offer,” Clare Savage, chair of AER, said in a press release on the suit. “We expect providers to be in a position, and remain in a position, to respond when called upon by AEMO.”
The Kogan Creek station has a history of tripping frequently and instantaneously, according to a 2020 report by the Australian Institute. “The worst performing individual generating unit,” on the National Electricity Market (NEM) grid, which supplies power to 80 percent of Australians, the station’s size also means the impact of its shutdowns is massive. Tesla’s Big Battery was supposed to step in when Kogan Creek failed.
For the most part, it’s done its job, the reserve company claims: HPR saved Australian consumers $116 million in costs for FCAS in 2019 alone, according to an independent review that the company commissioned last year. It carried an estimated 12 to 15 percent of the local market for grid support across the region in that time, the report says.
Neoen Australia managing director Louis de Sambucy told Motherboard in an email that the company is “disappointed by the AER decision to commence proceedings, underscoring a handful of recent grid shortages in which the Hornsdale battery offered crucial support.
“Hornsdale Power Reserve has and will continue to deliver important services for the electricity network and we will continue to work collaboratively with the regulator,” de Sambucy said.
The Australian regulator is seeking financial penalties in its lawsuit against Hornsdale.
“It is vital that generators do what they say they can do if we’re going to keep the lights on through the market’s transition to variable renewable generation,” Savage said in the press release.
Motherboard reached out to the Australian Energy Regulator for comment and did not hear back by publication.
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