Tesla's confidence of being able to plug gaps in grid power has been buoyed by its successful completion of a similar assignment in southern California last year, when it built an 80MWh battery farm in 90 days after a gas peaking plant near Los Angeles leaked tonnes of methane and had to be closed.

Tesla was one of three battery companies to step forward when the California power system operator called for emergency storage and it is one of a large number of battery companies vying for the 1.6 million solar rooftop homes and businesses in Australia.

"We could install everything and get it up and running within 100 days," Mr Rive said at the launch of Tesla's Powerwall 2 battery in a converted substation at Newport, near Melbourne.

"We had a similar challenge in southern California ... We got 80MWh up in 90 days. That's unheard of. You just don't get power plants running up and down that fast."

Energy crisis

Mr Rive's claim comes as Prime Minister Malcolm Turnbull declares a national energy emergency , and the Australian Energy Market Operator warns that either gas users or electricity generators will go short in future unless something is done urgently.

Tesla battery packs at Southern California Edison's Mira Loma substation are capable of powering roughly 15,000 homes over four hours. The company will instal the world's largest battery in South Australia. Tesla

AGL Energy has warned that it may be unable to meet gas demand this winter and manufacturers have warned of mounting job losses and plant closures because of skyrocketing electricity and gas prices and a looming shortage of gas.


Installation of more battery storage could ease pressure on the gas market.

Mr Rive said the $US5 billion Gigafactory had brought a "step function" reduction in battery costs per unit of capacity, and the Powerwall 2 would pack twice the capacity of its predecessor - 14KWh - in a case 30 per cent smaller, for the same cost.

Cost down

He said the cost for large installations had come down to $US400-600 per kilowatt hour of capacity depending on the configuration, or about $US50 million ($A65 million) per 100MWh, with reductions for large scale installations.

Workers at Tomago Aluminium in Newcastle had to shut down potlines during the heatwave in February to save energy and avoid wider blackouts. Peter Stoop

The Powerwall 2 units - $10,000 installed in Australia - could be stacked for larger households or businesses, up to 9 in each stack, carrying about a 126KWh of capacity. Eight stacks would pack a MWh. They will be ready for delivery in Australia next month.

Mr Rive said with batteries in households and at large scale in the power network, "it would be near impossible to bring down the grid" because no part of the system would be dependent on anything else.

The company is running a pilot program in California with utility Pacific Gas and Electricity (PGE), and talking to utilities around the world - including Australia - about similar installations, and announcements could be expected in the next few months.


Power stations obsolete

Battery storage is in its infancy but Mr Rive said he expected "100 per cent" of Australian households with rooftop solar - currently there are 1.6 million - to install batteries over the next decade because many of them are losing fat legacy feed in tariffs.

Prime Minister Malcolm Turnbull has admitted for the first time his government supports the penalty rate cut. Louise Kennerley

Storage and smart management systems - such as those offered by Reposit Power and Greensync and through upstart retailers like Mojo Power and Powershop - can enable households to get better value from their panels and also support the grid for a fee or a cut of the savings when shortages loom.

He said the rollout of the technology would make the building of costly new coal power stations and transmission networks - as governments and transmission companies have been urging - unnecessary and a costly mistake.

"By the time it gets activated the technology will be obsolete, and it's going to take years and it won't address the immediate problem," he told reporters.

"The worst possible outcome" would be to continue investing in the grid as solar panels and storage were rolled out to millions of households, he said. "It makes no sense to duplicate infrastructure."