The cost of the Tesla Powerwall

The public announcement a couple of months ago by Tesla of a medium sized stationary Lithium-ion battery targeting the household market provoked an inordinate reaction. The web erupted with the Powerwall, from exuberant stockholders to mindless criticism, to Forbes' ridiculous claims, every one had a compulsive need to opine over it. I noted the hype and expressed my scepticism towards a technology that seems far from cutting edge in what stationary applications is concerned.

In spite of all the publicity there was little effort to put numbers up for discussion. What is the cost of the electricity generated by a system backed by a Powerwall?

This post is an exercise attempting to answer this question. It presents calculations towards the levelised cost of electricity for a household self-consumption PV system, with and without the Powerwall.

Press review 15-08-2015 - The dolldrums

It is the middle of August, it is a holyday in much of Europe, but also weekend and most folk are away on vacation. The media is mostly concerned with the influx of refugees, that now occupy traditional holiday destinations. The Brent index hardly moved, staying flat throughout the week at 49 $/b, just an hair off the January lows.

China budged its currency in response to internal economic difficulties ever harder to hide. In the same day the media reported actions by the Chinese Central Bank to depreciate and appreciate the Renminbi. The worrying thing is that apparently this was actually the case.

This review is just a short roundup on the some of the issues followed in this space the last year. Starting by Ukraine, where the Kiev government slowly derides and finds it increasingly difficult to keep its territory together.

Press review 08-08-2015 - Contango deceivance

The Brent index closed a sixth consecutive week of losses under 50 $/b and just an hair off the bottom set last January. The main difference this time is a considerably flatter futures curve; now only in 2017 the future contract fetches a price above 60 $/b. The mainstream media tries to sell the mindless idea that a flatter curve means lower prices for a longer period. In practice this means traders have less of an incentive to store petroleum to sell at a later date, i.e., the supply glut if far less severe this time. But well, these days only the unwary trust the mainstream media at face value.

Various analysts had been for months advertising against what it seemed a growing disconnect between petroleum extraction rates reported by the US government's EIA and the real market. The EIA kept reporting increasing extracted volumes against a backdrop of collapsing prices, declining drilling rigs and asset fire-sales. Cornucopian pundits used this disconnect to foolishly claim the "shale" industry had become efficient enough to be profitable at low prices. But there is no magic here, just a cover up of sorts. And once again we see how the US government is anyything but innocent in this story.

Press review 01-08-2015 - Something must break

There is no bottom in sight for commodities at this moment, and petroleum is no exception. The Brent index closed down for the fifth consecutive week and is now just 3 $/b over the secular bottom set last January. Sour news for the fossil fuel industry in general mar the business pages of the mainstream media: investment deferrals, staff cuts in the tens of thousands, quarterly losses, unavoidable mergers; the spectre of a bankruptcy wave haunts on.

With far less impact on the mainstream media these long months of volatility and under-price petroleum is brewing all sorts of instability among petroleum exporting countries. From Venezuela come news of mass plundering, pointing to an relevant loss of control on the economy by the government. Ailing public finances in Angola foster contest to the regime, that in its turn replies with ad hoc arrests. The UAE is raising petrol prices by 25% overnight.

Something must break. This market is simply not sustainable, part of the supply curve is about to be shaken off. Rest to know exactly which. Will a wave of bankruptcies wipe off the mal-investment in North America? Or will it come down to the implosion of one or more exporting economies?