Elon Musk announced the world's biggest Lithium Ion Battery in South Australia last week. Photo/AAP
Tech billionaire Elon Musk has put his money where his mouth is and has promised to solve South Australia's energy issues by building the world's largest lithium-ion battery.
His promise: If he can't deliver on the battery in 100 days, it will be free.
Last week, Premier Jay Weatherill announced the South Australian government had accepted the "historic agreement" with Tesla and French renewables company Neoen.
Sony Corporation first commercialised lithium-ion batteries in 1991 and widespread use has been seen in products such as laptops and mobile phones ever since.
The product offers double the capacity of nickel batteries and can store 150 watt-hours of electricity for every kilogram of battery.
Lithium-ion is a low maintenance battery, with no scheduled cycling - fully discharging a battery and then recharging it again - required to prolong the battery's life.
Despite advantages, lithium-ion is fragile and requires a protection circuit to maintain safe operation.
Tesla will be building the world's largest lithium-ion battery, which is 60 per cent bigger than any other large-scale battery energy storage system on Earth.
The 100MW battery will provide the region with 129 megawatt-hours of energy to be paired with Neoen's 99-turbine wind farm at Hornsdale, near Jamestown, South Australia.
Around 640 Tesla PowerPack's - each containing 16 individual battery pods - will charge using renewable energy then deliver electricity during peak hours to help maintain the reliable operation of South Australia's electrical infrastructure.
In addition to load balancing the state's renewable energy generation, the batteries will provide emergency back-up power in the case of a blackout.
In a blog post, Tesla said the project in South Australia "will provide enough power for more than 30,000 homes", or reportedly a total of about 1 hour and 18 minutes of power going at full capacity.
Currently the world's largest installation is an 80 megawatt-hour substation at Mira Loma in Ontario, California.
Built in a collaboration between Edison and Tesla, the battery storage contains two 10 megawatt systems, each made of 198 PowerPacks and 24 inverters.
The 80 megawatt-hour batteries can store enough energy to power 15,000 homes for four hours or 2,500 homes for an entire day.
Since being turned on in December 2016, the battery storage substation has been used to ensure electricity generated from photovoltaic solar and wind farms does not go to waste and also offers an alternate power source during peak hours of the day.
Elon Musk's '100 days or it's free' pledge will start immediately after the grid interconnection agreement has been signed.
News.com.au has attempted to contact the South Australian government but they are yet to confirm when that agreement will be signed.
However, both Tesla and Jay Weatherill have separately said they expect the project to be completed by December 1.
Industry suggestions published by Forbes claimed the 100MW battery farm would cost between $A200 million and $A240 million.
Speaking to reporters on Saturday, Premier Jay Weatherill dismissed this price range and despite refusing to reveal the exact cost to taxpayers, he said the project would fall well within the $150 million set aside for renewable energy alternatives.
Tesla's battery division head Lyndon Rive originally suggested a price of $US400-600 kWh, which would put the cost of the 100MWh system at around $A66 million.
Musk himself had previously quoted significantly less than prices previously suggested, with his estimates putting the system at around $A33 million.
According to Musk, the battery is expected to create an 'initial huge input' of local jobs during the construction phase, although he admits there will be few ongoing positions as the system is designed to be self-sustaining.
Local company Consolidated Power Projects will be responsible for ongoing work and maintenance after winning the contract.
Professor Hugh Saddler said the installation will make an important contribution to increasing the security and reliability South Australia's troubled electricity supply.
"[The project] will help to keep a lid on wholesale electricity prices, by making it more difficult for gas generators in the state to drive prices up to extreme levels by what is called strategic rebidding behaviour," he told Gizmodo.
Research Principal at the Institute for Sustainable Futures Dr Geoff James said the timing of the project would be excellent as it would provide support before the coming summer.
"The Tesla battery farm, like a modern Stonehenge aligned with the surrounding turbines, will shift wind energy production to make it more dispatchable and therefore more profitable, he said.
"At the same time, its high power capacity will be available in quick bursts to keep frequency in the right range. In just the same way, batteries at residential and commercial premises can support both the owner and the grid, and it won't be very long before South Australia can aggregate another 100 MW of battery capacity in this way."
Deputy Director of the Monash Energy Materials Dr Ariel Liebman added the groundbreaking announcement foreshadows the shape of the Australian energy future, but suggested we shouldn't get too complacent.
"There are still significant challenges in turning this kind of activity into business-as-usual. We still don't have a National Planning Framework, as pointed out by last month's Finkel Review," she said.
"Failing to take such a national approach will likely result in billions of dollars of stranded assets as different technologies unexpectedly emerge as competitive at various locations at different points in the future. The current NEM market design cannot efficiently incentivise investment over the required horizons."
Just spoke with @JayWeatherill, Premier of South Australia. Very impressed. Govt is clearly committed to a smart, quick solution.
— Elon Musk (@elonmusk) March 11, 2017
Last September, 1.7 million residents were left without electricity - some for up to two weeks - in a statewide blackout caused by 50-year storm damaged critical infrastructure.
The heat of the Australian summer in early 2017 also resulted in more blackouts this year.
Responding to Aussie tech giant Mike Cannon-Brookes's challenge to build a 100MW battery farm, Musk said he could deliver in 100 days.
Premier Jay Weatherill said a multistage procurement process attracted around 90 responses to the Expression of Interest from battery storage manufacturers, including LG Chem, AES and Kokam, and developers such as Zen Energy, Carnegie Clean Energy and AGL Energy.
"I'm thrilled with the selection of Neoen and Tesla, whose experience and world leadership in energy security and renewables will help South Australia take charge of its energy future," he said in a statement.
"Battery storage is the future of our national energy market, and the eyes of the world will be following our leadership in this space.
"This historic agreement does more than bring a global energy giant in Tesla to South Australia, it will also have some significant economic spin-offs."
The government added the winning tender was a "competitive commercial offer with the best value for money".
Tesla has previously claimed it is able to drive down the per kilowatt hour cost of its battery pack by more than 30 per cent by "using economies of scale, innovative manufacturing, reduction of waste, and the simple optimisation of locating most manufacturing process under one roof".