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Tesla's Elon Musk offers to solve power crisis in South Australia
March 10, 2017 / 7:40 AM / 8 months ago

Tesla's Elon Musk offers to solve power crisis in South Australia

MELBOURNE, March 10 (Reuters) - Tesla Inc boss Elon Musk on Friday offered to save Australia’s most renewable-energy dependent state from blackouts by installing 100 megawatt hours worth of battery storage within 100 days of signing a contract.

The offer follows a string of power outages in the state of South Australia, including a blackout that left industry crippled for up to two weeks, and stoked fears of more outages across the national electricity market due to tight supplies.

Musk made the ambitious offer on social media, and the government said it could consider backing such a battery roll out by Tesla.

“The government stands ready through ARENA and the CEFC to work with companies with serious proposals to support the deployment of more storage,” Environment and Energy Minister Josh Frydenberg said in an email to Reuters.

ARENA is the Australian Renewable Energy Agency and the CEFC is the Clean Energy Finance Corp.

Musk made the offer in response to a comment made on social media by Mike Cannon-Brookes, the co-founder of Australian software maker Atlassian Corp, who said he would be willing to line up funding and political support if Tesla could supply batteries that would solve South Australia’s problems.

Musk responded by tweeting: “Tesla will get the system installed and working 100 days from contract signature or it is free. That serious enough for you?”

He quoted a price of $250 per kilowatt hour for 100 megawatt hour systems, which would imply a price of $25 million for the battery packs, when Cannon-Brookes asked for an estimate.

“You’re on mate. Give me 7 days to try sort out politics & funding,” tweeted Cannon-Brookes, who could not be immediately reached for further comment.

Tesla launched its Powerwall 2 in Australia, the world’s top market for rooftop solar. Battery storage is just one of several options the government is looking to back in order to ensure reliable power supplies as the country grows more reliant on intermittent wind and solar power.

“We have been talking with a number of large-scale battery providers about potential storage solutions, including in South Australia. To the extent Tesla is interested, we’ll also talk with them,” Clean Energy Finance Corp Chief Executive Oliver Yates said in an emailed statement.

Following a record-breaking summer, Australia’s energy market operator warned this week that eastern Australia desperately needs more gas for power stations within the next two years to provide back-up electricity for wind and solar and avert blackouts.

Reporting by Sonali Paul; Editing by Randy Fabi

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