Did Tesla’s Big Australian Battery Kill the Business Case for More?
There might not be much of an ancillary services market left for other projects. JASON DEIGN
The Hornsdale battery is almost doing too good of a job.
Figures show that Tesla’s “big battery” in South Australia is so good at delivering frequency control ancillary services (FCAS) that there might not be much room left for copycat projects.
As first reported in *RenewEconomy*,
In addition to gobbling up FCAS revenues, the McKinsey research showed that Hornsdale’s arrival cut ancillary services prices by 90 percent across South Australia’s eight FCAS markets.
The problem is that Hornsdale has done such a good job of mopping up FCAS revenues that it might have significantly altered the business case for further battery plants.
Exactly how much Hornsdale makes for its owners is not clear, since the figures are not disclosed and in the McKinsey analysis, “We just looked at the societal impact,” Godart van Gendt, the McKinsey expert associate partner who carried out the analysis, told GTM.
However, it is clear that a 90 percent drop in FCAS pricing is going to make things hard for any future players looking to make their money from ancillary services.