Navigant Research Blog

Tesla and Storage Industry Take Up Another Challenge to Strengthen the Grid

— August 3, 2017

In September 2016, the massive blackout that hit South Australia cut electrical service to roughly half of the state’s 1.7 million residents for anywhere from 4 to 48 hours, putting grid reliability and renewable energy in the spotlight. Following that event, Tesla CEO Elon Musk claimed that large-scale energy storage could have prevented the disaster, promising that his company could build 100 MW of energy storage in just 100 days or it would be free. While this was seen by many as an attempt to get energy storage in the conversation about grid upgrades, it has now been announced that Tesla won a competitive solicitation to build a 100 MW storage facility.

Tesla’s new project will be located at the Hornsdale Wind Farm currently being built by French firm Neoen. The project will have a 100 MW power output with 129 MWh of storage capacity using Tesla’s lithium ion Powerpacks. The system will be used to smooth the output of the wind farm, shift energy to align with grid demand, and provide reserve capacity for the grid that could theoretically prevent future blackouts as both a source of system inertia and system restart services (in other words, a blackstart).

Major Challenges

Tesla faces some major challenges to build this project in such a short period. If successfully operational within 100 days, it would be one of the few 100 MWh-scale storage systems in the world commissioned in less than 4 months. These records were recently set last year when several large storage projects were built in response to California’s Aliso Canyon natural gas leak to provide emergency reserve capacity.

The key challenges noted by companies that developed the Aliso Canyon response projects involved supply chain and logistics and the overall orchestration/coordination of the project. However, Tesla may have advantages in logistics, as it is a vertically integrated provider of battery systems, which will reduce the time required to order both batteries and balance of system components. Given its recent expansion of manufacturing capacity, it is possible that the company already has many of the modular Powerpack systems built and ready to ship to support this project.

Once the batteries and all necessary components have arrived onsite, the coordination of such a large and complex engineering project is no small feat. Few projects of this scale and type have been built. As with many large storage projects, the experience is a first for local contractors providing engineering and construction work, which can delay the process.

Major Impact

If the project is successfully developed on time, it will represent another milestone, proving the maturity of the energy storage industry. The relatively short timeframe needed to build new large-scale storage projects gives the technology a major advantage over alternatives such as thermal power plants and transmission and distribution infrastructure. A shorter development period allows for shorter planning cycles for utilities, allowing them to quickly respond to changing grid conditions.

This project represents the first major competitive win for Tesla’s large-scale storage business in the Australian market. However, Tesla is not alone in developing massive storage plants in Australia. The Lyon Group recently announced its third solar plus storage project in the country, bringing its total pipeline of projects in development to 640 MWh. However, many stakeholders still question the economic viability of these storage projects, and regulatory rules are still evolving in Australia and other markets around the world. Despite the concerns, these projects are evidence that energy storage is starting to play a major role in the global electricity industry, with large-scale projects able to solve grid issues faster than conventional systems.

 

Chevrolet Bolt Shows GM Is Serious About Making the EV Mainstream

— January 30, 2017

Electric Vehicle 2A decade ago, the documentary Who Killed the Electric Car? chronicled General Motors’ (GM’s) decision to repossess all of the existing EV1s from the small but loyal group of customers that had been leasing the pioneering battery electric vehicle (BEV). Ever since, skeptics have doubted the company’s true commitment to making BEVs—the Volt had an internal combustion engine, and the Spark EV was viewed by most as a compliance car. Wonder no more, because the 2018 Chevrolet Bolt demonstrates that GM is committed to making the BEV mainstream.

While Tesla has made big promises with the upcoming Model 3, GM has pulled ahead by now delivering Bolts to customers. Sales of plug-in EVs (PEVs) have fallen far short of the projections made when automakers revealed the first wave of modern BEVs at the beginning of the decade. Nonetheless, cumulative sales for Tesla, GM, and Nissan are beginning to approach the 200,000 level that will trigger a phaseout of federal tax credits. When that happens, the effective price for consumers will jump by $7,500, and PEVs will truly have to stand on their own merits in order to attract buyers.

Lessons Learned

As the first dedicated BEV developed by GM since the EV1 in the early 1990s, GM has applied lessons learned from its prior efforts and observations of what has happened with competitors. “The Bolt program was launched more than 4 years ago with a decree from then-CEO Dan Akerson to deliver an appealing car with a 200-mile electric range and $30,000 price point,” said Stuart Norris, managing director of the GM Korea Design Studio. Norris’ design team, along with the engineering teams in South Korea and Michigan, had a clean sheet of paper to work with.

Seeing the global market trends of increasing urbanization, the growth of ride-hailing services, and the rising consumer preference for higher-riding crossover vehicles all helped to define the general form factor of the Bolt. Advances in battery and electronics performance and cost enabled the team to meet their targets.

A comparatively small footprint in line with B-segment models like the Honda Fit means the Bolt occupies less space on the road. At the same time, its tall stance means there is ample room for at least four adults in its 95 cubic foot passenger volume. Smart packaging means it actually exceeds the 94 cubic feet of cabin volume in the much larger Tesla Model S, and it’s easy to get in and out for passengers of ride-hailing services like Lyft, in which GM is an investor.

Practical and Appealing

Performance is a big Tesla selling point, especially the oft-heralded “Ludicrous” acceleration. However, the much larger external dimensions and mass of the Model S mean that it’s not so nimble on twisty mountain roads or as maneuverable in tight urban areas like San Francisco. At half the price of the least expensive Model S, the Bolt doesn’t offer quite the same thrust, but with 200 horsepower and 266 lb.-ft. of instantly available torque, the Chevy still gets to 60 mph in under 6.5 seconds. More importantly, it handles both mountain passes and urban centers deftly, and based on a first drive, use of the low mode with its extra regenerative braking can boost the vehicle’s charge range well beyond the EPA-estimated 238 miles.

The launch of the Bolt and Model 3 has inspired other automakers to rethink their EV plans and boost the planned range to over 200 miles. If everyone can make their EVs as practical and appealing to drive as the Bolt, we may finally see a surge in sales that makes the emissions-free vehicle a mainstream reality.

 

EV Market Needs More Practical Vehicles, Less Hype

— January 19, 2017

Please 2017, bring us more announcements of practical, production-ready, 200+ mile range battery EVs (BEVs), and fewer of the concept electric super cars or Tesla killers. Yes, these long-ranged, sleek, sporty thrill rides are pretty and may sell in small volumes to high-end buyers when (or if) they come to market. But startups that are seemingly overcompensating for inexperience by showcasing their engineering prowess and far-flung visions won’t provide the needed bridge to mass adoption.

Since Tesla found initial success with the Model S, the term Tesla killer is frequently part of the discussion around most new, long-range BEV introductions from both established and startup automakers alike. In 2016, one company that was the focus of such hype was LeEco, which invested billions in EV startups. These investments led to what was described as one of the more lackluster BEV debuts at 2016’s Consumer Electronics Show (CES): Faraday Future’s FFZERO1. Unfortunately, the company’s variable platform architecture and the way in which that architecture might advantageously position Faraday to achieve its lofty business goals received muted attention relative to the billboard-doubling tail fin.

As it is presented, the architecture should allow Faraday to expand and diversify its vehicle offerings beyond the initial flagship model with ease. Regardless of whether the platform accomplishes Faraday’s business objectives, maintaining focus on either this aspect or another business innovation would showcase the company’s pragmatism and flexibility—qualities desperately needed in a rapidly evolving market. Unfortunately, during Faraday’s attempt to debut its flagship model at 2017’s CES, there were wide reports of financial trouble as well as an executive exodus.

The Race Against Tesla

LeEco’s other two EV investments, Lucid and LeSee, have as of yet avoided some of the harsher skepticism surrounding Faraday. The cars presented by the company do look closer to being production ready. Given that, LeEco is playing catch-up alongside many of the established premium brands, as well as positioning to compete against Tesla. All are aiming to introduce their long-range, $100,000+ flagships sometime before 2020, begging the question: will there be room for all in the premium EV segment?

While these would-be competitors try to outdo each other and out-maneuver Tesla, Tesla continues to stress pragmatic business model innovations. This includes advancing electrification outside of costly premium vehicle segments, laying the groundwork for automated mobility systems, taking the lead in public infrastructure development, and expanding into home energy management. Moving quickly on all fronts is a tough ask for any company, but at least any stumbles Tesla makes are likely to be grounded in vision and not vanity. For their part, the established OEMs are less fallible of Tesla-killer glory and are moving quickly to deploy practical innovations in affordable long-range BEVs, ultra-fast charging developments, and new mobility services.

 

Lucid Motors Is the Latest Silicon Valley EV Upstart

— November 28, 2016

Electric Vehicle 2Chances are you’ve never heard of Lucid Motors. The company has been around for nearly a decade but only recently rebranded itself from Atieva in mid-October. Despite (or perhaps because of) its lack of public awareness, several members of the Lucid team came to Los Angeles for some private briefings during AutoMobility LA. I had an opportunity to learn about what Lucid is planning, get a VR walk-around of the company’s finished vehicle design, and check out one of its prototypes.

The Lucid team includes former Tesla staff among its ranks, including CTO Peter Rawlinson and marketing director Zak Edson. The company’s as-yet-unnamed luxury sedan is scheduled to go into production in 2018 and will be built at a US factory, although no site has yet been announced. Atieva was launched in late 2007, focusing on producing batteries for commercial EVs. “Atieva-powered vehicles have accumulated more than 20 million miles of real-world use with a faultless safety record,” said Rawlinson.

Smaller Footprint, Larger Interior

Rawlinson joined Atieva in 2014 when the company decided to build cars from the ground up. Despite the achievements of Tesla, Rawlinson explained that he still saw a lot of untapped potential in repackaging everything to take advantage of the electric drive system. Tesla’s Model S has the footprint of a large luxury car, but only has the passenger volume of a midsize sedan at 94 cubic feet. However, it meets the US Environmental Protection Agency’s large car designation based on its 26 cubic feet of cargo space, bringing the total to the 120 cubic feet threshold to qualify as “large.”

Rawlinson and Derek Jenkins, Lucid’s vice president of design, sought to reverse that trend with a smaller footprint (akin to a midsize Mercedes-Benz E-class) and an interior volume of 112 cubic feet for occupants. The Lucid sedan uses a similar skateboard layout to other modern dedicated battery EVs (BEVs), with the battery pack under the floor and electric motors at each axle.

In mid-2016, Lucid published a video showing off the performance capabilities of an in-development powertrain prototype based on a Mercedes-Benz Metris cargo van. Using a 600 horsepower (hp) front motor and 400 hp rear motor, the van is capable of sub-3 second 0-60 mph acceleration.

Better Batteries

Lucid has been developing its own proprietary battery chemistry that Rawlinson claims will have 20% greater volumetric energy density and will be less vulnerable to deterioration from repeated fast charges. Assuming Lucid and its cell manufacturing partners can deliver, this will help enable the company to deliver a 100 kWh battery with an optional 130 kWh unit to deliver driving ranges of 300 and 400 miles, respectively. The company plans to equip its car with a sensor package capable of Level 4 autonomous driving. The package includes four solid-state lidar sensors, short- and long-range radar and cameras, and ultrasonic sensors.

The prototype that Lucid brought to Los Angeles had an incomplete interior, but based on the VR demo and looking at the test vehicle, it does appear to be more roomy than Tesla’s Model S. Pricing won’t be announced for some time but it will likely be comparable to the Tesla and in line with Lucid’s goal of delivering a zero-emissions executive jet for the road. Lucid plans to publicly reveal its car on December 14 at its engineering facility in Fremont, California.

 

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