Tesla to sell 25 MW battery as part of Salt River Project settlement

Tesla, by way of purchasing SolarCity, and Salt River Project (SRP) are moving forward in a negotiation to settle a lawsuit brought by SolarCity in 2015, that was headed to the Supreme Court for oral arguments this month.

According to the Agenda Notes,

SRP will purchase a 25 MW utility-scale battery system (BESS) from Tesla, at no more than current market price.

Per AZCentral.com, the board voted to approve the settlement details on Monday, March 5, 2018.

The battery storage plant will be built at the Aqua Fri Generating Station in Peoria. The site is a natural gas plant, with a relatively small 200 kW solar system.

Additionally, SRP has agreed to launch a limited incentive program for residential batteries, with the incentive going to the end users – not directly to the manufacturer.

However, SRP has not agreed to withdraw the rate structure put in place that led to this litigation. There has been an agreement to test new demand rate structures with a limited number of customers.

The beginnings of this lawsuit were that a judge ruled SRP acted illegally as a monopoly in February of 2015, when they approved a new rate structure for PV system owners.

Jean Su, associate conservation director at the Center for Biological Diversity, commented on this,

“This settlement doesn’t address the heart of the problem. While it may be a positive step for battery storage, it fails to prevent utilities like the Salt River Project from continuing to set unfair rates for customers who want to embrace rooftop solar. In our era of runaway climate change, we can’t allow outdated utility monopolies to prop up their bottom line by restricting access to renewable power and obstructing our clean energy transition.”

The changes included a monthly demand charge of US$9.25 per kW of capacity in the customer’s PV system. Under the new structure, the average compensation for electricity generated under net metering was also reduced from the retail rate of around $0.09, to $0.05 per kWh.