Seeking Alpha
View as an RSS Feed

Steve Funk  

View Steve Funk's Comments BY TICKER:
Latest  |  Highest rated
  • How Volkswagen Thinks It Will Undercut Tesla On Battery Cost [View article]
    "Also, do not give Panasonic all the credit for Tesla's cells. Tesla has a proprietary patented design and Panasonic manufactures this design"

    Show me a Tesla Patent for battery chemistry:
    Tesla's patents revolve around the pack construction, charging, thermal management, etc. Right now, Tesla really does need Panasonic's secret sauce.

    Also, the Gigafactory agreement has the battery pack being assembled there with operations being supervised by Panasonic.
    Mar 20, 2015. 08:44 AM | 3 Likes Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    You can lash out but you really are trying to make engineering claims that are baseless. A) MWh are not the same as MW and cannot be used to figure out the peak capacity of a generating SYSTEM. B) Energy and power, as used by engineers, is different. C) You have been using a lot of column inches proving a lot of nonsense that has little to do with battery storage and less to do with generating capacity or efficiency. JRP is right. The blended cost structure of generating electricity throughout the day varies considerably.
    Mar 15, 2015. 06:21 PM | 2 Likes Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    You are making a lot of assumptions that are wrong. Unlike finance where the units are always dollars, energy calculations must have correct units.

    You are using gross TWh figures that you found on Wikipedia and then assuming you can back into a power plant capacity from that. The capacity of a plant would be rated in MW, not MWh.
    Mar 13, 2015. 08:05 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    Blue Sky,
    You keep repeating that 9% of electricity is hyrdo. The DOE claims 6%-8%. Hydro runs low in the summer when all the air conditioners are running. There really is some good information on hydro power (and electricity storage) at the DOE web site you should check out The DOE is examining expansion of off-shore tidal and wave hydro generators but mostly in the Pacific. Other than that hydro generation will remain capped.

    You ignore the inefficiencies of hydro storage. You can lose 15% running a turbine, then another 15% to pump back up, especially if you include transmission losses. That is one attraction of the battery storage method. The round trip losses will be much less, maybe one third less. The Ludington site I referenced is linked to a nuclear plant where fuel is relatively cheap but installed capital is large. Keeping that capital working overnight offsets the pumping and transmission losses.

    You are looking at electricity storage as an engineering problem to solve. I do not. All of this technology is known. I look at it as an economic problem. With low demand for utility bonds, poor payback for many alternative energy solutions (including battery storage), and Public Service Commissions who do not want to change quickly (i.e. raise electricity rates drastically) how are any of these things going to take off quickly? That is why from an investment standpoint I recommend taking a wait and see approach. I don't see battery storage being a money maker for Tesla. It will help them fulfill their agreement with Panasonic. Perhaps Solar City will get a bump from this since they will be the ones selling and installing the storage batteries.
    Mar 11, 2015. 12:03 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    "If grid A sends electricity to grid B, and grid B sends electricity to grid C, then one might argue that grid A can constructively send electricity to grid C."

    If only life were that simple. In fact transmission losses can equal 10% or greater to transmit several hundred miles even with "stepping up [voltages] high enough". To transmit inter-continental could wind up losing 25% of your electricity. The cost of those losses quickly pays for a generating facility closer to the point of use.

    You also assume that the grid interconnections have infinite capacity. They do not. There are bottlenecks in the grid interconnections. We will never transmit electricity across the continent due to the inefficiencies, but with billions investment in transmission capability we will be able to more effectively use wind farms and solar electricity within regions. Part of that will be electricity storage but all of this infrastructure will be built in fits and starts. If you have a long investment horizon buy copper mines, Siemens, and GE, and IBM.
    Mar 11, 2015. 11:31 AM | 3 Likes Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    The upgrade of the grid is an issue. Transformers and their associated switchgear (i.e. substations) are one of the key parts of the grid and will take decades to upgrade. Since this is an investment web site, how do you think the investors and bond holders of this equipment will react when told we are just going to write off their equipment and they (utilities and their investors) just have to take it on the chin? That solution will not fly.

    As for the electric demand, you are not entirely correct to say that there is this steady increase forever. Conservation and efficiency efforts have had surprising effects. Some areas of the country are indeed using LESS electricity than a decade ago. Autos take a huge amount of energy and will impact the grid negatively. There are dozens of papers on it and it is not so simple as to prove it in a short remark with a few numbers as you have done. Also, the needs vary considerably in different regions of the country.
    Mar 10, 2015. 02:12 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    The Ivanpah Solar facility is over 400 MW, as big as a decent sized coal plant! I could not find how long thermal storage lasts, but I believe the working fluid is sodium with large underground reservoirs. There is also a huge helio stat that you can see from the air when traveling from Denver to San Francisco. That is probably the Nevada plant you mention. These are a great solution in the desert.
    Mar 10, 2015. 02:00 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    Blue Sky,
    Hydro power available is a relatively fixed amount and runs pretty near capacity. Hydro power capacity is being reduced slightly as a small movement is taking hold to remove small power dams. Part of this is a desire to return rivers to their natural state and part is driven by old dams/ turbines that need repair and do not have an economic case anymore. There are no significant hydro sites left in the US so we cannot expand this option.

    As for water storage, as I have said, it is a limited option. Your numbers indicate that hydro can achieve 9% of our electric capacity. Here is a quiz on where our power comes from You can see that hydro is mostly on the coasts becasuse that is where the elevation changes are. Hydro power is only several percent of total production and falling. As a practical matter pumped water storage like that at Ludington is more difficult to get past environmental hurdles so it is more of a point solution than a general solution as your numbers indicate.

    Last, your gross back of the napkin analysis assumes that all electricity can be generated anywhere and consumed anywhere. That simply is not how our grid works. For many reasons electricity must be generated and used regionally. That means that all that cheap electricity from the Bonneville dam will never be able to help Chicago.
    Mar 10, 2015. 01:37 PM | 3 Likes Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    "Your utility ought to expect to need to upgrade customer equipment constantly (several times per decade)"

    Substations and power lines need to be upgraded to increase electrical service capacity. Transformer lives are on the order of decades, not fractions of a decade. You don't help the EV cause by using false numbers and logic to claim that no infrastructure upgrades will be needed. Rational and regular upgrades to the existing infrastructure will need to be made to support the coming EV needs.

    Public Service commissions determine infrastructure upgrades and the PSC members are appointed by elected officials. The sooner these costs are out in the open and a fair plan for cost allocation worked out the sooner EV costs can be counted on. That can only help the EV industry in the long run.
    Mar 9, 2015. 03:55 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    Your units don't even add up in your calculations. Even NREL has papers showing that the most optimistic projections of solar/ battery charging is at least slightly more expensive than operating a conventional car.

    There are other papers by NREL and others that show the electrical infrastructure across the country will need an upgrade in order to charge even a significant fraction of the vehicle fleet. It can't be solved by downloading a new Tesla charging algorithm.
    Mar 9, 2015. 03:08 PM | Likes Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    "This is a bigger market than ev cars"

    Nonsense. There are over 254 million registered vehicles in the US.

    By contrast, there are less than 90 million single family residences (attached and detached). I don't see landlords of 4-plexes putting in battery systems for the renters pleasure.

    So potential residential solar/ battery installations are a little more than 1/3 of the vehicle market.
    Mar 3, 2015. 04:27 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    Blue Sky,
    There are pumped water storage/ generation facilities:
    It levels demand for nuclear and wind generation.

    There are problems with water storage too. First you need a Lake Michigan in your back yard. Where are you going to get 29 Billion gallons/ day in California.

    I am not sure how you figure "that the existing US hydroelectric infrastructure could provide enough storage to supply nearly 100% of the US night-time electric demand." Seems like crazy talk to me. Hydro is only a few percent of total generating capacity. Most river based dams cannot "charge" at night and generate during the day. There is no physical way we can generate 100% of US demand with hydro storage.
    Mar 3, 2015. 02:57 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    All of your references are from people selling themselves (Goldwater) or selling equipment (Solantro control electronics). The RWE that you cite with 80 MW "distributed" capacity appears to have 73 MW in wind power. The dynamics of 5 Mw "distributed" wind turbines is a far different scenario than the subject here (Tesla residential batteries). Maybe I missed something in your reference? I would submit that press releases from politicians and salesmen do not make good arguments for one energy policy or another. Do you have any peer reviewed engineering studies?

    In any event, this board is supposed to be about investment. Specifically in this thread, about investment in battery storage for residential solar. Simply stated, there is not a general cost effectiveness for residential solar storage. Other commenters have pointed out narrow cases where subsidies have made a marginal case for the homeowner. Until there is an economic case where it makes sense to put photovoltaic generation/ batteries in houses then I think it unwise to invest. In the case of Elon Musk, he is involved with Solar City so he can sell to himself (or his brother). Since Solar City writes a form of sale-leaseback-savings sharing deals, they could probably structure battery deals that look mildly attractive to some cash strapped homeowners. In the long run that won't be enough to keep selling residential batteries.

    You seem to think that I am against solar energy, or "alternative energy" in general, you are wrong. Humans have always used many forms of energy and will continue to do so. Solar might make sense for those in the southwest (homeowners being only a little more than half the population), but not in other areas of the country. Before someone comments that solar works "everywhere", consider that in December Phoenix gets an average of 4.9 KWh/m*2/day. Duluth, Minnesota, gets 1.7, Boston 1.9, and Anchorage 0.6. For the year, Duluth gets two thirds the sunshine as Phoenix so would get less than two thirds the savings since you have to size electrical equipment for peak demand. NREL has a lot of good data on these things and decent scientific studies, much better than politicians statements.

    If I don't see a broad market and high margins for a new device I would not invest in it. No pro-battery commenters have offered any data that show a broad sustainable market for residential batteries so I do not believe it will add substantially to Tesla's profit.
    Mar 3, 2015. 02:47 PM | 1 Like Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    "You charge your batteries with cheap electricity over night then use it during the day when higher rates are in effect. "

    First, not everyone (probably most people do not) have night time electrical rates. In that case you would actually have to pay more for your scheme due the battery charge/discharge inefficiency.

    If your cost differential was $0.05/kWh then each night you stored 100 kWh (allowing for charge/ discharge inefficiency), then charged your Tesla during the day, you would save $5 each "fill-up". If the battery cost $25,000 then you will only have to fully charge your Model S for 13 years to reach a breakeven point. Hopefully your battery holds out longer than that so you can enjoy your payback.
    Mar 3, 2015. 12:30 PM | 2 Likes Like |Link to Comment
  • A Comprehensive Look At Tesla's Home Batteries [View article]
    "Power companies can buy energy from you cheaper than they can pay to generate it themselves using conventional means or spending their own dime to build out alternative infrastructure.
    Therefore, they GLADLY endorse you buying retail "

    A) Residential rooftop panels do not generate electricity more cheaply than coal plants. Period. The topic is too huge to even start you learning with one or two links. All I can say is start reading.
    B) Power companies in many jurisdictions have been forced to collect additional fees to subsidized the residential power. Read your electric bill carefully next time. They are not "gladly" buying dirty, uncontrolled, solar power. It is a PITA for power companies to deal with these small unmanageable power sources.

    The point I was trying to make above is that Public Service Commissions have chosen many ways to shift costs and revenue to favor residential solar energy. The net metering that Californians love and continually point to as a wonderful opportunity is not available everywhere. Another case is pointed out below by JRP3 regarding the "cheap" night rate. Again California is the prime example of a cost dislocation that is probably not warranted on purely economic terms and certainly is not available to everyone.

    That forced reallocation of money to bootstrap the solar industry cannot be sustained as solar energy grows. That is not an opinion, it is a math problem. Using different assumptions of solar growth rates and utility fixed costs will give you a different inflection point, but there will certainly come a time when residential solar will have to pick up their fair share of the grid. And unless you want to live like a hermit, solar generators need the grid.
    Mar 3, 2015. 12:03 PM | 1 Like Like |Link to Comment