Tesla Seals Deal With Dorset Energy Storage Plant As British Business Is Established

Tesla’s move into the UK energy market has been consolidated with news that the Californian tech giant has sealed a deal to supply a Dorset energy storage plant with software and hardware. Best known for its electric cars, Tesla last week became the world’s most valuable car manufacturer, Tesla also has a promising battery technology and energy storage unit.

It is Tesla’s energy business that the company has moved to expand into the UK. In May the company applied to the UK regulator Ofcom for an energy generation license. That application is still in process and Tesla has declined to comment on its plans in Britain. But if the deal announced yesterday is an indication, the company plans to sell its technology to partners as well as potentially invest in its own battery power plants.

The Dorset plant based in Poole is being developed by British company Harmony Energy in a joint venture with Spain’s Fotowatio Renewable Ventures (FRV). Six Tesla lithium-ion batteries will be installed. They will store energy produced by renewable sources and sell the energy to the National Grid.

Storing renewable energy for use when conditions are not optimal for its production gives the National Grid more flexibility at peak times for energy consumption. Normally short falls have to be made up by firing up capacity at fossil fuels-burning plants. But next generation battery technology such as Tesla’s is gradually beginning to offer a solution as the UK tries to shift away from fossil fuels.

Tesla is world leader in grid storage battery technology, which some analysts believe has the potential to become almost as important to the company as its electric vehicles business. The company has also built a software suite, Autobidder, which allows households that buy battery packs to store excess energy generated from solar panels or other renewables, to aggregate and trade that electricity. Thousands linked together by the software form a “virtual power plant” that can offer meaningful volumes of electricity to the National Grid. The Poole plant will also license the Autobidder software from Tesla.

Harmony Energy chief executive Peter Kavanagh commented:

“Utility-scale battery energy storage is critical to the future of the UK’s energy supply, often seen as the missing link in the UK’s renewable energy strategy, both in terms of controlling grid frequency and providing backup during periods of peak demand and supply.”

Harmony’s Poole joint venture is planned as the first in a “pipeline of battery energy storage plant to be built in the UK.”