A Tesla car charging station at the wind and solar battery plant outside Jamestown in South Australia. Credit:AAP It arrived in time for this summer's strains on the electricity system, and may come in handy as the mercury soars this weekend over a region of Australia in arc from Adelaide to Tasmania and up to Brisbane and beyond. The big battery, located next to the Hornsdale wind farm in the mid-north region of South Australia, has already been active, drawing interest from well beyond these shores. The Los Angeles Times and Washington Post were among international publications to cover the battery's early success in shoring up Australia's electricity grid. Interest was sparked in part by the battery's quickfire response – just 0.14 seconds – to inject electricity into the network following the failure of a 559-MW unit of Loy Yang A in Victoria's Latrobe Valley.

All smiles now: SA Premier Jay Weatherill tours the new Tesla battery site at the start of December. Credit:AAP "It appears to be far exceeding expectations," the LA Times trumpeted. "In the last three weeks alone, the Hornsdale Power Reserve [as the battery is known] has smoothed out at least two major energy outages, responding even more quickly than the coal-fired back-ups that were supposed to provide emergency power." 'Lumbering coal' The concept of the battery beating out coal-fired power was a key part of the story, prompted by an article on the RenewEconomy website, headlined: "Tesla big battery outsmarts lumbering coal units after Loy Yang trips". Hazelwood Power Station in Victoria closed in March 2017, with more coal-fired plant closures to come. Credit:Pat Scala

"By the time that the contracted Gladstone coal unit had gotten out of bed and put its socks on so it can inject more into the grid – it is paid to respond in six seconds – the fall in frequency had already been arrested and was being reversed," the report said. As impressive as it seemed, the reality, though, was probably more prosaic. Analysis by Dylan McConnell, a researcher at Melbourne University's Climate & Energy College, found each of Gladstone's six units increased output and had supplied 12.7 MW of the shortfall before the battery "had done anything". It also appears that at least for the Loy Yang unit tripping on December 14, the battery was not "enabled" in the back-up market for Frequency Control Ancillary Services (FCAS). In other words, the battery operators probably weren't paid for that intervention.

'Outstanding' While the hype rings a bit hollow in that instance, there's no doubt the battery has been making a difference, responding to four coal generator trips in December alone. Franck Woitiez, managing director at Neoen – the French operator of the battery – told Fairfax Media its performance had been "outstanding". (Tesla, as is its wont, declined to comment.) "We are very proud of the battery performance throughout December and the start of January," Mr Woitiez said, adding the company had received "quite a few inquiries" about its operations. Critics have quibbled at the battery's size, highlighting that alone it could only supply perhaps 30,000 homes for an hour or so, at a cost guessed at $US50 million ($64 million).

But such figures ignore the many benefits – including supporting the security of the grid – that are only beginning to be understood. "The battery has been dispatched on multiple occasions for both energy and FCAS," a spokesman for the the Australian Energy Market Operator tells Fairfax. For December, "the battery was dispatched for energy on over 380 separate five-minute dispatch intervals, and enabled on over 4600 separate dispatch intervals in one or more FCAS markets", he said. 'Significant' savings The SA government also spruiks the benefits.

"It is difficult to determine price trends at this early stage, however the battery has been active in the Raise and Lower Regulation Frequency Control and Ancillary Services [R-FCAS] markets since commissioning," a SA government spokesman tells Fairfax. "The cost of Raise and Lower R-FCAS in SA in December 2016 was $502,320, compared with just $39,661 in December 2017, following the operation of the battery," he said. "In recent times FCAS services have cost South Australians about $50 million each year," he says. "The battery is expected to significantly reduce the cost." According to Mr McConnell, the battery dispatched about 2.5 gigawatt-hours of electricity while consuming about 3 gigawatt-hours, representing a round-trip efficiency of about 80 per cent. "The performance to date has been very impressive. It's ramp-up from zero output to maximum in seconds (or less) is something that we haven't seen in the electricity market before," Mr McConnell said, noting the current fleet of "fast start" units take five to 10 minutes to synchronise to the grid and start providing power.

Cases of the Tesla battery responding without being "enabled" could also be part of its testing, and there may also be arrangements with the SA government separate from the FCAS market, he said. Victoria moves too A smaller 20-MW battery deal signed with last week between Neoen and the Victorian government – again using Tesla – will provide similar benefits to Victoria when it comes online in mid-2019. The site, next to a wind farm near the western Victorian town of Stawell, could be the first of perhaps a dozen or more battery and storage ventures in the pipeline, according to the Smart Energy Council. "What we're seeing in South Australia and in Victoria is really the tip of the iceberg for projects that will be coming along," John Grimes, the head of the council, said.

Bruce Mountain, director of Carbon and Energy Markets, a consultancy, said the battery is already proving its worth with the full implications still to come. "The biggest single source of insecurity to the power system is a trip of a major coal thermal generator unit simply because they are so large – [it's] not the wind or the sun, or people switching on their airconditioners," he says. Batteries are also useful in taking up excessive supply should demand suddenly drop, affecting the frequency of the grid on the upside. "In the olden days, this was simply sent out to large heatloads, which would just heat up, and waste all the energy into the air," he said. Slowing down progress

The arrival of batteries and other storage that can be immediately released has exposed flaws in the existing market. One issue remains the fact generators supply at five-minute intervals that are priced on the average over half an hour, with an alignment of the two not due to kick in for years. "Bringing the settlement period in line with the trading period, which will come from 2021, will be a major step in allowing batteries to compete effectively and get their full value," Mountain said. That delayed implementation is "symptomatic" of how the industry, including regulators, continues to be dominated by major, centralised operators, he said. (AGL, Energy Australia and Origin Energy are the three biggest so-called gentailers, combining generation and energy retailing.) "They do all they can to slow down progress and ensure the market compensation mechanisms don't suit them," Mountain said. "And the energy market authorities have generally been in their pockets." The power industry has been struggling for years as ageing coal-fired power plants close and shifting federal and state policies have created busts and booms in renewable energy. Troubles included South Australia and its 1.7 million residents being hit by a blackout following a storm in September 2016 and NSW narrowly dodging major forced outages during a heatwave in February 2017.

Snow job Mountain is scathing of the federal government's response, not least its promotion of the Snowy 2.0 pumped hydro scheme as a way to support the grid. By his estimates, it will need 1.8 megawatt-hours to generate each MW-hour of storage for the proposed scheme that Prime Minister Malcolm Turnbull has touted as one of his government's major responses to the nation's energy crunch. "There is no doubt at all that the revenues it will produce won't compensate the capital costs," Mountain says, estimating it would take as much as a decade to build and balloon out to $8 billion – or four times Turnbull's initial estimate. "It took them a couple of months to build Musk's battery, which is essentially a white good that you plug and play," he said.

"I've got absolutely no doubt that batteries will win hand over fist." Households and businesses are also seeing batteries emerge as a viable option to add to solar panels, reducing exposure to higher power prices. Loading Mountain estimates batteries and solar PV with grid back-up are "now competitive on any grid offer" in South Australia, and the same is true for about a third of residents in Victoria and NSW. "It will be true for two-thirds in a couple of years' time – if not in a year's time," Mountain predicts. "It's all happening very quickly."