Tesla Batteries Help to Cash In on Transition to Renewable Energy, Reports the University of Queensland

by Eva Fox March 04, 2021

Tesla Batteries Help to Cash In on Transition to Renewable Energy, Reports the University of Queensland

Photo: The University of Queensland

Tesla's battery, installed at the University of Queensland in late 2019, demonstrated that grid-connected energy storage systems can generate income from renewable energy sources. Published on March 2, the report provides a detailed overview of the project's performance in 2020.

As part of the University of Queensland’s energy leadership ambitions, a 1.1MW/2.2 MWh Tesla Powerpack battery system was constructed at the St Lucia campus in late 2019—the state’s largest behind-the-meter installation at the time.

At an all-in cost of $2.05 million, the project was funded through the sale of renewable energy certificates created by UQ’s existing 6.3 MW behind-the-meter solar PV portfolio. The battery is controlled by a custom system developed by UQ called the Demand Response Engine or DRE.

From a financial perspective, the battery delivered a total of $158,000 in value to UQ across 2020. Just under half of this was earned during Q1, with Q4 accounting for the next 22%, followed by Q2 and Q3, which made up around 15% each. FCAS makes up over half of all income, with arbitrage contributing a further 30%, and the virtual cap service contributing around 15%.


Source: The University of Queensland

While the battery fell short of revenue expectations, the 2020 performance review report concludes that the St. Lucia battery has achieved "excellent results" from a technical standpoint throughout the year, including its ability to beat the state's gas peakers at their own game. It also highlights the fact that, in the case of FCAS, this underperformance was primarily driven by lower than forecast market pricing during Q2 and Q3. The FCAS service also suffered from a lack of participation in the contingency lower market, as well as an absence of co-optimization between the FCAS and arbitrage functions.

Underperformance by the virtual cap service was driven by financial cap prices being substantially lower during 2020 than forecast at the end of 2018 when the project’s financial modeling was completed. This reflects an overall reduction in volatility across the Queensland region of the National Electricity Market (NEM) driven by many factors, including the impacts of COVID-19.

The report said that the findings of the performance review make it clear that the UQ battery, and battery energy storage in general, are well positioned to seize the opportunities that will be created as the energy transition continues to gather momentum.



“From an overall perspective, the performance of the battery during 2020 has solidified its place as a central part of UQ’s energy management program now and into the future, despite its size only being a fraction of overall site load,” the report says.

“This role will be amplified by a range of forces that are poised to rapidly reshape the energy market over the coming months and years. This includes yet further increases to the penetration of variable renewable energy sources, as well as the pending change to five-minute settlement as of October 2021."

© 2021, Eva Fox. All rights reserved.

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