Tesla Powers California

tesla powerpacks

Tesla’s newest product, the Powerwall battery, unveiled in California on April 30.

Ringo H.W. Chiu/Associated Press

Tesla Motors Inc wins bid to supply grid-scale power in Southern California to help prevent electricity shortages

Tesla to begin providing Southern California with energy after winning California utility storage contract to help prevent power shortages following the biggest natural gas leak in U.S. history.

The Powerpacks, worth tens of millions of dollars, will be operational by December 2016.

Tesla Motors will be supplying 20 megawatts of energy storage capacity to Southern California Edison to prevent blackouts by replacing fossil-fuel used for electricity generation with lithium-ion batteries.

It should be enough to power about 2,500 homes for a full day, the company said in a blog post. However, the real significance of the deal is the speed with which lithium-ion battery packs are going to be deployed.

This deal fits into Elon Musk’s long-term vision of transforming Tesla from an electric car company to a clean energy company.

Which happens to be the same motivation behind his deal to acquire SolarCity Corp, the rooftop solar company which was founded by his cousins, of which he happens to be the chairman.

A 2-megawatt battery system by Tesla costs about US$2.9 million, according to company’s website. The company does negotiate contracts which are greater than 2.5 megawatts.

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