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Tesla's big battery in Hornsdale has managed to earn back its construction cost in just a little over two years, highlighting once more that renewables are on their way towards beating coal-fired power plants. With such an achievement under its belt, the Tesla Powerpack farm in South Australia remains as one of the premier examples of how renewables could be used as viable alternatives to fossil fuels.
Last month, Neoen, the French owner and operator of the Tesla big battery, stated that the system has recorded a fivefold increase in revenue in the first quarter. This was due to a set of circumstances that are rather unique and next to impossible to repeat. Among this involved a tornado that cut the transmission link between Victoria and South Australia in late January.
During the incident, the Hornsdale Power Reserve, which is still considered as the largest operational battery installation in the world, was deployed to serve a critical role in managing system security in South Australia. The region was forced to operate as an energy island for almost three weeks, but the Tesla Powerwpack farm, as well as two other battery installations, ultimately helped keep the region's grid safe and stable.
This intervention resulted in a spike in revenue for the Hornsdale Power Reserve to about €21.6 million ($AU36.2 million) in Q1 2020, a far cry from the €4.2 million that the system earned during the first quarter of 2019. So significant was the Tesla big battery's revenue in Q1 2020 that it actually exceeded the facility's earnings for all of 2019.
Such figures are no joke, considering that 2019 was a great year for the Powerpack farm, with the installation showing a 14 percent rise in annual revenue to €20.5 million ($AU33.2 million). But with these figures in mind, the big battery had already recouped its construction cost of $AU96 million. These earnings go hand-in-hand with the fact that the facility has delivered about $150 million worth of savings to people in the region.
Unusual weather phenomena aside, it is difficult to argue against the Hornsdale Power Reserve at this point. Even without the tornado that resulted in a spike in revenue in Q1, it would only have taken the big battery perhaps a year or two to recoup its construction costs. This is a big win for renewables, especially since batteries like Tesla Powerpacks are designed to last a very long time.
The rapid return of investment for the Hornsdale Power Reserve also flies in the face of criticism that the facility has received from critics. After all, the facility was openly mocked by Australian Prime Minister Scott Morrison back in 2018, who suggested that the Powerpack Farm was just as useful as some tourist attractions like the Big Banana in Coffs Harbour. Considering the performance of the big battery so far, it appears that the Prime Minister's Big Banana joke lost its freshness even before it had a chance to be picked.Follow @PurplePanda88