SA Government announces Tesla deal to install batteries and solar panels at 50,000 homes and link them to the electricity grid

A NEW scheme to install free batteries and solar panels at 50,000 South Australian homes — linked to the grid to create a 250MW virtual power plant — will cut power prices by around $80 a year.

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ELECTRICITY bills are expected to drop $80 each year after the State Government announced a scheme to pay for 50,000 homes to have batteries and solar panels installed — which will be linked to the grid to create a 250MW virtual power plant.

Teaming up with billionaire Tesla founder Elon Musk once again, Premier Jay Weatherill announced 24,000 housing trust homes and 25,000 private homes will have batteries and solar panels installed.

The move is expected to cut their electricity bills by 30 per cent.

Mr Weatherill said the scheme would create the biggest “virtual power plant” in the world, which independent electricity expert from Frontier Economics Danny Price had calculated could cut 5-6 per cent, or $80, of all household’s bill on average by increasing competition and forcing down prices.

Salisbury North resident Des Jenkins was the first customer to be switched on when the Housing Trust home he shares with his wife and two grandchildren was transitioned to the scheme on Sunday.

He said it was the first time they could afford to use some appliances in the home, despite having all the “mod cons”, because their quarterly bill would be cut from around $900 to $600.

“We are using a dishwasher we couldn’t use before, air conditioning because we couldn’t afford it and our bill was up to $927 every three months,’’ Mr Jenkins said.

“We have custody of two grandkids and they use up the power on our pension, now we even have an app on my phone to see what we are using.’’

Announcing the scheme at Mr Jenkins’ home, Mr Weatherill said: “The Virtual Power Plant will be the biggest of its kind in the world, easily eclipsing Canberra’s Reposit Power Virtual Power Plant, which connects 250 homes and businesses to the grid.

“Today’s announcement is the next phase in the State Government’s Energy Plan, which is already making South Australia more self-sufficient through the world’s largest lithium ion

battery and the solar thermal plant.”

Salisbury North resident Des Jenkins was the first to be connected to the State Government's new solar scheme. Picture: Miles Kemp

Mr Weatherill denied the announcement was designed to draw attention from the Liberal Party campaign launch, also on Sunday, and the deal had been signed by Mr Musk on Friday afternoon.

Private investors will pay for the bulk of the $80m start-up cost of the scheme along with a $2m grant and a $30m loan to Tesla from the State Government.

Deputy Opposition Leader Vickie Chapman pilloried the scheme and said it compared badly with the Liberals electricity plan announced last October.

The Liberal Party would create a $200m interconnector fund to help build a $500m new interconnection between South Australia and the rest of the National Electricity Market.

Independent testing showed the average household bill would fall by up to $302 a year by 2021/22 under the Liberal plan, which included subsidies for 40,000 to help them buy batteries.

“The State Liberal’s policy will help 40,000 South Australian households buy a battery and save all South Australian households $300 when fully implemented,’’ Ms Chapman said.

“The Weatherill Government will help Elon Musk upgrade his private jet.”

The scheme is far bigger than private sector alternatives, eclipsing the biggest being carried out in SA by AGL, which is connecting 1000 homes.

One thousand housing trust homes will be the first to be connected to the 5kw systems.

Over five years the scheme will be rolled out to 50,000 homes, with private homeowners able to apply for free installation by logging on to www.virtualpowerplant.sa.gov.au for details.

People will be selected based on need but also geographical spread for installation efficiency and optimising use of the electricity.

How it works

Roof top solar panels: 50,000 homes will each have 5kw of solar photovoltaic panels generating electricity to power the home.

Battery: Excess power charges this battery. The 13.5kwh battery is part of a network of 50,000 in garages located in areas where power could become scarce around Adelaide and when needed can be fed into the system.

Inverter: The system turns the stored power into a form that can be fed back into the grid.

Money: The householder pays nothing for installation of the system and the hardware, because part of the sale of the electricity back into the grid pays for this. The remaining profit from the energy generated goes to the householder to take around 30 per cent off their annual bill.

Policy police

What? 50,000 will have batteries and solar panels installed at no cost.

How? $2m gift to Tesla, $30m loan and $48m of its own money to be recouped with a cup of the electricity fed back into the grid.

Pub test: The 30 per cent cut in bills for the lucky householders will be easily achieved as they are under current solar-panel payments for electricity fed back into the grid. There will be less blackouts with another 250MW at the ready to stop shortages, but the 5-6 per cent cut in bills for all when electricity companies have to compete harder for customers; don’t hold your breath.