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Tesla’s use of clean power for its battery factory would be unprecedented

Amid the news that Tesla and Nevada have come to an agreement over a deal that would see Tesla’s massive battery factory built in the state was another head-turning bit of information. Tesla CEO Elon Musk said that the factory will produce its own energy through a combination of geothermal, wind and solar, and it’ll produce all of the energy that it needs — Musk described it as “a self contained factory.”

Tesla's image of its clean powered factory. Courtesy of Tesla.
Tesla’s image of its clean powered factory. Courtesy of Tesla.

In Tesla’s communications materials, the company called the factory “a net zero energy factory” that will be “powered by renewable energy.”

If [company]Tesla[/company] builds — or even buys — enough clean power to run the entire 10 million-square-foot factory, which will be filled with energy-intensive battery manufacturing machinery, it would be unprecedented in the history of industry and manufacturing. Energy-intensive manufacturing factories don’t often build their own power, and never say they’re going to do it entirely with clean power.

Some countries that have substantial naturally-occurring baseload clean power (“baseload” means it runs all of the time) like Iceland can run their aluminum smelting industry off of hydropower and geothermal power. But Tesla said it will meet its energy needs with not just geothermal (baseload) but also solar and wind, which are variable sources of power (meaning, they only occur at certain times of day).

How it is going to do this is not entirely clear. Will Tesla actually build and own the solar, wind and geothermal assets around the factory? If it did that, would it work with a power developer via a power purchase agreement?

Or will it buy power from clean power projects around the state, some potentially already under development, and connect the factory to the grid? If Tesla did that it would use the same amount of power from the grid as the power from the clean energy projects that it’s buying from (Apple uses this model for its data centers).

Solar Farm in Tucson, Arizona. Image courtesy of IBM Research, Flickr Creative Commons.
Solar Farm in Tucson, Arizona. Image courtesy of IBM Research, Flickr Creative Commons.

If it builds its own power around the factory, will it overcome the variable nature of solar and wind using its own batteries for energy storage, storing the energy during the day to be used at night or when the wind dies down? Tesla would need some kind of way to overcome the solar and wind fluctuations, whether that’s the grid, generators, or energy storage.

If Tesla does meet all of its needs with new solar, wind and geothermal power generation, that’s going to require a whole lot of panels, turbines and geothermal wells. Navigant Research analyst Sam Jaffe told me he would expect a 10 million square foot battery manufacturing factory to have a peak electricity consumption of over 100 MW.

For comparison’s sake, Apple has a 500,000 square foot data center in North Carolina that could be using around 60 MW (it doesn’t disclose the actual energy consumption). Battery manufacturing is usually more energy intensive than running servers and keeping them cool.

Apple has built out two huge solar panel farms (the largest privately owned in the U.S.) that each stretch out across 100 acres and together produce 40 MW. Now Apple is building another 100 acre solar panel farm to make another about 20 MW. So Apple will have 300 acres of solar panels to power its data center (also a small fuel cell farm). That’s three hundred acres of clean power for a 500,000 square foot data center, which is less energy intensive than making batteries.

And Apple doesn’t power the data center directly from the panels; its solar farms put the energy onto the grid and then the data center draws the equivalent power from the grid. Apple didn’t want to invest in energy storage tech for the solar sites, as that would bump up the cost of clean power considerably.

So, the solar panels that will be on the roof of Tesla’s “Gigafactory” are just a drop in the bucket for the type of clean power it would need. If Tesla builds out its own clean power, the area around the 10 million square foot factory will be covered in clean power farms.

Ormat's Steamboat Complex that produces enough geothermal power to run the city of Reno. Image courtesy of Katie Fehrenbacher.
Ormat’s Steamboat Complex that produces enough geothermal power to run the city of Reno. Image courtesy of Katie Fehrenbacher.

If Tesla builds out geothermal power for a big portion of its factory energy needs, that would be an unprecedented high-profile use of geothermal power. Geothermal power plants use drills to tap into the somewhat rare earthly occurrence of hot underground rocks meeting significant water or steam, which can be pushed to the surface and then recirculated to keep a geothermal plant running. Nevada has substantial geothermal resources, but many places don’t, and thus geothermal power has long been a very small portion of the world’s energy mix.

The biggest expense for geothermal power is the expense of getting the wells drilled, since a portion of the wells drilled don’t successfully tap into the right place to extract geothermal power. But if Tesla, or a power producer, is willing to invest in these initial upfront costs, geothermal power is then a very low cost and baseload form of clean power once it’s up and running. However, Tesla might also be buying geothermal power from sites that are already under development and drilled.

Since Tesla said the factory will be “net energy zero,” the company might end up buying renewable energy credits (RECs) to cover any clean power that it can’t buy or generate itself. All of these energy details will need to be worked out pretty soon, as clean energy power plants can take many months and even years to build, and Tesla wants its battery factory delivering batteries by 2017, with the ability to produce enough batteries to power 500,000 cars by 2020.

At this point it’s not clear how Tesla will power the world’s largest lithium ion battery factory with just clean power — and clean power it says it will produce itself. But once again Tesla stands alone in terms of creating an entirely new vision, and its willingness to take really big risks. And if done right, its methods for powering battery manufacturing with clean power could be a lesson for other companies to do this too.

35 Responses to “Tesla’s use of clean power for its battery factory would be unprecedented”

  1. Joseph Toomey

    Except that you forgot that there is a thermal conversion process before you get all those recharging kVs into the battery, isn’t there? That’s the problem with leftist math wizardry. We all do math the same way. But it comes down to where you start your figuring. Lefties invent a point at which history begins and explain everything from there. But history begins at the beginning.

    Electric Car Conversions:
    Chemical-to-Heat (power plant primary)
    Heat-to-Mechanical (power plant turbines)
    Mechanical-to-Electricity (power plant generation)
    Transmission Loss to Residential
    Electricity-to-Chemical (car battery recharge)
    Chemical-to-Electricity (car battery discharge)
    Electricity-to-Mechanical (car motive power)

    Gasoline Car Conversions:
    Chemical-to-Heat (car combustion)
    Heat-to-Mechanical (car motive power)

    As to those subsidies, both CBO and DoE analyzed the problem three years ago. On a BTU basis, renewables were subsidized 23 to 25 times more than oil and gas. I hope your extension cord reaches all the way to the local library where you can look up this stuff.

  2. Eugene Pharr

    It’s all about the long view and money. If you have enough stable money to invest up front, the long term stability and economy of “clean” power is entirely worth it.

    If your profit-horizon for the investment is only a year or two, however, it’s not.

    Most American companies have an even SHORTER profit outlook of the next several quarters. As a result, the “long view” comes across as an alien idea to most business folks. Elon Musk, however, is clearly NOT planning for short term gain. He’s trying to change the world. And THAT requires the “long view”.

  3. I’m so happy to read this article. We need more companies that are interested in moving forward, and not just trying to exploit our current energy possibilities. My bet, as some of the commenters agree, would be the maximization of the use of geothermal energy. It would be the best way how to satisfy such a big need for the whole factory. It is also a strong precedent for the future – when companies such as Tesla or Apple turn to renewable energy, it would logically improve and subsequently spur the research focused on this area. And this can lead to new possibilities for all of us, not just private companies. I believe that clean energy is the best way how to secure our energy independence as well as to help people in developing countries to focus on other problems than on their impoverished citizens who are struggling to pay the energy bills or don’t even have an access to them. This can lead to a greater affordability of the energy in the very near future.

  4. its so simple. The load of the factory will be known. Lets say it needs 100 MW of nameplate capacity (the author confuses MW with Mwh). Tesla can put 100MW of new solar, wind or geothermal into play, or buy 100MW of capacity already in existence, or a mix of the two. It IS irrelevant where the clean power comes from except to the extent of transmission losses that would have to be made up..to deliver the electrons to the gigafactory.

  5. Brett Gutoskie

    @Doreen Gaydoon

    Two cars per 177 million households? Um, yeah, I’m not sure if you noticed, but not everyone has a car, wants a car, or can afford a car. And then there are folks that bike, take transit, walk, take the train. Nevermind the impact of car sharing, which has been growing substantially, and will continue to do so (see http://www.navigantresearch.com/newsroom/carsharing-services-will-surpass-12-million-members-worldwide-by-2020).

    And why are you cherry picking your statistics regarding solar? That’s one alternative energy source, in 2009 wind power made up approximately 2% of all energy produced in the U.S. (using your figure of 177 million house, that would be a minimum of 3.54 million homes, 24 hours a day. In 2013, that figure rose to 4% (that’s up to 7.08 million homes). (see http://www.epa.gov/cleanenergy/energy-and-you/). That’s only wind energy, add in solar and biomass and the proportion grows obviously.

    Also, you really need to check your calculator, because its been calculated that in order to power the WORLD (not LA), with solar power, it would require approximately 192,000 sq. miles of solar panels, at 2009 panel efficiency (see http://landartgenerator.org/blagi/archives/127). So at 113,990 and 121,589 sq. miles respectively, covering Arizona and New Mexico with solar panels would actually power the planet by a factor of 1.2.

  6. Nevada was chosen likely because of the basin and range province it sits in. Locate the factory in a graben (flat lying basin). Drill down along the fault line to get the geothermal energy. The graben area will be ideal for solar as well. The wind farm will likely be located in the horst or mountain area next to the graben. Nevada is a good choice based on this geology.

  7. The guy built a major car company in America where people said it could not be done, This is the man who built the Space-X company. We know that the technology is there to do it, so it would be hard to say it will not be done. In Nevada there is lots of sun and barren land so all i see is it will be very large. it will be the price point that is what matters. Once built the biggest cost will be zero and any new competitor will be priced out. It is actually a very smart move.

  8. “clean” = forcing taxpayers to convert a huge amount of fossil fuel into $s, and then, thru force of law, take those $s and give them to someone else to make electricity in a more inefficient way than just burning the original fossil fuel directly. What a total scam…

  9. Tesla may start GRID tied and even use clean credits REC/SREC until they get all their systems and new batteries ready for prime time. It’s a great goal that goes with the Tesla can do process.

    My home and EV run on 110% Solar . I make more than we use and get paid. We help the GRID during the Peak hours and take their extra Off Peak and still make 10% extra every year. It paid for itself in 3 years and is good for about 50. I did it in 2001 before incentives or Net-Metering .

    A factory is a lot bigger but I’m sure it can be done. If anyone can do it Tesla and Solar City will do it.

  10. Phil Williamson

    On the west coast, the majority of that power will be generated from Hydroelectric and wind. Idaho, Oregon and Washington get (ballpark) 80% of their power from Hydro, and a good chunk of the balance from wind.

  11. Doreen Gaydoon

    At some point, we need to have a realistic, honest conversation about our electric car passion. According to Edmunds mild temperature drive across the country, they used 5.04 MwH. annualized. 2 cars per each of the 177 million households, and the average household usage of 10 MwH doubles. Just reported was that we have installed in this solar/alt energy run, enough solar capacity to run 3.2 million houses during the hours of 10am and 2pm. We got there with massive subsidies, and skyrocketed energy prices that keep the working poor from getting out of the hole they have lived in since 2007. Where, at present and next 10 year efficiency for these cells, we need to cover all of AZ and half of New Mexico with panels, just to power Los Angeles, and we wish to eliminate all coal, oil, gas, nuclear and hydro (free the fish) electric power sources, I can’t see how we get anywhere beyond a rich liberals toy and a massive SMUG alert (hat tip Trey Parker). Please correct my math, but this seems quite foolish no matter how one jacks the numbers. Where is the factory for chargers? Where is the factory for extension cords? where is the factory for 480V service components? perhaps this is why liberal educators have wished to play down mathematics skills? I’m wagering Tesla is BK and on the Solandra pile before the factory gets built. Just pumping me thinks.

    • Phil Williamson

      “I’m wagering Tesla is BK and on the Solandra pile before the factory gets built. Just pumping me thinks.”

      Solyndra failed (more or less) for one reason; the price of PV grade silicon dropped from around $1000 a ton to around $20.00 a ton. Had that not happened, Solyndra would have (most likely) been a huge success.

      Where will this energy come from? Well, gasoline takes about 4-6 kw per gallon to refine. That same energy, no longer needed to refine gasoline, can be “redirected” to charge batteries. That energy will move an EV about 3-4 times the distance as that gallon of gas would have done. It’s all about efficiency.

      “perhaps this is why liberal educators have wished to play down mathematics skills? ”

      Hopefully…even conservative mathematics “wizards” can understands a 90% efficient electric motor beats the pants off a 25% efficient internal combustion engine when it comes to converting energy into locomotion. :-) It also beats them when it comes to performance. The quickest street legal electric can in the U.S. can go from 0 to 60 mph in 1.8 seconds. It can do ~10 seconds through the 1/4 mile on less than 10 cents worth of electricity. It’s all about efficiency.

      “We got there with massive subsidies, and skyrocketed energy prices that keep the working poor from getting out of the hole they have lived in since 2007. ”

      What are these “massive” tax subsidies you speak of? The “working poor” have been trying to get out the hole, not since 2007, but since the 80’s when Reagan conjured up his “trickle down” disaster.

      The replacement for displacement is the modern 3 phase AC motor. Ask “Big Daddy” Don Garlits why he stopped using gas powered racers :-)

      • durham kid

        Thanks for your intelligent response, Phil.

        There (2) things I would like to add:

        1) Doreen has overlooked, as almost everyone else including (supposed) ‘experts’ on energy, the potential of energy conservation. EC is the most quickly deployed, least expensive, least controversial, best environmental and GREATEST potential energy ‘source’ available. I work in the field – our waste of energy is phenomenal – but the good news is that the potential is thus also huge. In the end EC – both planned and unplanned – will be the energy ‘source’ that saves us.

        2) Per unit of energy produced, conventional energy sources receive much greater subsidies than renewables – and they are a mature industry, which should not still need these subsidies. THAT is the gross distortion of the marketplace -whereas the subsidies to renewables are a pittance that attempt to correct thes inequities. I would gladly END ALL SUBSIDIES – but what with the powerful influence of the conventional energy industry, that is not going to happen.

    • Well, I didn’t see much math to correct, but I’ll add some of my own.

      85 KWh per 265 miles driven in an EV *
      3 trillion total vehicle miles driven in the US in the past year (and trending down)**

      So, 85/265*3*10^12 = 962 TWh per year required if all US vehicles were EV’s.

      Compare this to the 4,095 TWh produced in the US in 2012. *** It’s not as bad as it seems, though. Most charging is done at night when power plants have plenty of excess capacity. So, even if all cars were EV’s we wouldn’t necessarily need many new power plants. Ultimately, all cars will be EV’s someday and I’m sure there are plenty of smart people at Tesla and the power companies who know what it will take to make it happen.

      * Using Model S stats. EV’s of the future will be smaller, lighter, and more efficient.
      ** http://research.stlouisfed.org/fred2/series/M12MTVUSM227NFWA
      *** http://en.wikipedia.org/wiki/Energy_in_the_United_States

  12. Just so we’re clear, this is going to be a factory that produces batteries, that doesn’t require external power, these batteries still need to be charged with power from whatever external source… This has nothing to do with the power source for the batteries when the cars are running…

  13. Brett Gutoskie

    I was kind of hoping they would make a bold statement like this. In essence, its the first step to unlocking a perpetual cycle of renewable energy growth. Harvest renewable energy, use it to construct energy storage. Harvest more renewable energy, store it and use it for constructing more energy storage. Sell energy storage to your suppliers so they can become net zero too, onwards and upwards.

    I love reading articles talking about how Tesla is going to manufacture too many batteries because they won’t be able to sell enough cars, totally missing the fact that Tesla is probably going end up being an energy storage company first and a car manufacturer second. Everyone wants cheap energy storage. Still doesn’t necessarily justifies Tesla’s crazy share prices, but nonetheless very exciting prospects.

  14. It’s certainly something we need to see flourish all over the world and allow the planet to recapture it’s oil… An unoiled machine could come to a screeching halt! Batteries themselves are on the verge of a higher capacity for storing power. Nice feed :O)

  15. Katie:

    The Gigafactory won’t use huge amounts of electricity. It will basically be a processing and assembly plant. All the high power intensity work will already be done: mining of lithium, nickle and carbon, smelting aluminum into plate. The Gigafactory will take the pre-processed raw materials and ‘re-arrange their atoms”, as Elon Musk likes to say, into the right shapes: components, batteries and finally packs. Even the four-story tall aluminum stamping machines Tesla Motors already uses are very efficient.

    Bottom line is that they’ll have no difficulty gathering enough green power to run their Gigafactory. They’ll probably be selling spare energy to their neighbors.

    Cheers:

    tinker

  16. I’d like to see how they plan on pulling this off. It’s one thing to say they’re going to do something unprecedented, but I’d love for them to fill in the gaps and say specifically how they’re going to go “clean.”

    I guess it would make sense to buy the clean energy initially as they ramp up their own production efforts. But that’s a guess. So any further digging you can do would be helpful. I’m a skeptic: if you’re going to aim big, be prepared to explain how you’re going to do it.