Tesla Motors Inc (NASDAQ:TSLA) just made another big deal to supply it’s PowerWall and PowerPack batteries to a utility firm. Advanced Microgrid Solutions says that it will install up to 500-megawatt hours worth of the firm’s batteries. These Tesla products, which are utility-scale lithium ion rechargeable batteries, offer grid support to utilities using customer load.
The news, which came in a press release from AMS, says that the batteries will offer power firms “greater reliability in areas with circuit overload, reductions in greenhouse gas emissions, and the seamless integration of renewable generation.”
One of the founders of the women-owned business is Jackalyne Pfannenstiel. She became Assistant Secretary of the US Navy for Installations and Environment in 2010, but left the post in 2013.
AMS is a startup out of Northern California. The firm took the energy storage industry by surprise last year when it made itself know as it announced a big 50 megawatt deal with Southern California Edison. That would be 50 megawatts of four-hours-worth of capacity. It is estimated that the project will make up about 200 megawatt hours out of Tesla’s total 500 megawatt hour contract.
AMS buys the Tesla Motors dream
Susan Kennedy, CEO of AMS says that “Tesla’s focus on performance and design makes them the stand out technology choice for our projects.”
She went on to say that “AMS’ projects require intelligent, powerful and scalable energy storage solutions. Tesla’s technology gives us the edge we are looking for.”
Tesla Motors is trying to get its energy storage business up and running and every deal counts. The money that will change hands in the AMS deal was not made public, but each new order is a boost to the Tesla Motors battery business.
“This is all about building resilience into the grid. Energy storage turns traditional demand response into firm, reliable capacity – it changes everything about the way the grid is operated.” said said Jackalyne Pfannenstiel,one of the firm’s founder and a former Assistant Secretary of the United States Navy.
The firm completed its first 50 megawatt contract last year, a piece of work for Southern California Edison. AMS managed to raise $8.8 million in a funding round at the end of May. Much of that money is now promised to Tesla Motors.
Tesla Motors gets power moving
There has been a lot of good news about the Tesla Motors Powerwall and Powerpack, but the firm’s biggest issue is going to be building enough of the units to satisfy demand. The AMS deal won’t require shipment of a huge number of batteries right away and instead forms a wish to buy them in future.
One TeslaPower pack can store about 100 Kilowatts of power. That means the 500MW buy from AMS is worth around 5,000 units.
Tesla Motors is putting together a huge factory in Nevada, but it’s only about one fourth of the way says CEO Elon Musk. When Mr. Musk and his team put an end to that project, and start to create storage on a big scale it will be able to get AMS the devices it needs.
Until then, this, as with the rest of the Powerwall deals, is a little bit of wishful thinking from both firms.