Environment

Tesla Is Building An Energy Trading Team

Say “Tesla” and most people think of electric cars. But Tesla is also an energy company. It has built some of the world’s largest battery storage facilities and operates a massive microgrid that will eventually include 50,000 rooftop solar systems coupled with residential storage batteries in Australia. It has applied to be an energy supplier in the UK and in Texas. And now, according to Reuters, it is looking to build an energy trading team based on a post found on LinkedIn.

That LinkedIn submission was created by Julian Lamy, who describes himself as a senior optimization software engineer for Tesla. “I’m building a new team at Tesla focused on Energy Trading and Market Operations,” he says. The job requires expertise in wholesale electricity markets, and the candidate will “lead trading and real-time operations for battery, solar, and wind projects participating in wholesale energy markets,” using Autobidder, according to the job posting.

What Is Autobidder?

Tesla Autobidder user interface. Credit: Tesla

So what is Autobider? For the answer to that, we turn to the Tesla website. It says, “Autobidder provides independent power producers, utilities and capital partners the ability to autonomously monetize battery assets. Autobidder is a real-time trading and control platform that provides value-based asset management and portfolio optimization, enabling owners and operators to configure operational strategies that maximize revenue according to their business objectives and risk preferences.”

Tesla goes on to say “Autobidder is part of Autonomous Control, Tesla’s suite of optimization software solutions. [It] successfully operating at Hornsdale Power Reserve in South Australia, and through market bidding, has added competition to drive down energy prices.”

Sharp-eyed readers will focus on the words “independent power producers” in the first sentence. They may imply that Autobidder will empower non-traditional energy producers, usually those with rooftop solar systems, to participate more easily in the broader utility market — something many utilities are not all that enthusiastic about.

“Batteries are highly flexible assets, but they require smart strategies and software to realize their full value,” Tesla says. “Autobidder allows owners to realize this value by handling the complex co-optimization required to successfully stack multiple value streams simultaneously, including:

  • Wholesale markets, including energy, ancillary services and capacity
  • Transmission & Distribution-level grid services
  • Renewable firming and shaping
  • Bilateral contractual arrangements
  • Other portfolio needs

In wholesale markets, Autobidder includes participation in the following, where regionally applicable:

  • Day-ahead markets
  • Real-time markets
  • Continuous markets

Autobidder uses proprietary artificial intelligence algorithms developed by Tesla for:

  • Price forecasting
  • Load forecasting
  • Generation forecasting
  • Dispatch optimization
  • Smart bidding

“Autobidder’s algorithms are adaptable to new markets and services, and continuously improve through experiential data to maintain high financial performance in dynamic market environments. Autobidder was designed to collaborate with and augment the capabilities of human operators. Autobidder continuously executes transactions in the market using a numerical optimization model that is based on the parameters set and adjusted by a human operator, reflecting the preferences of the trading desk.” The position advertised on LinkedIn is seeking the person who will be in charge of that trading desk. Tesla goes on to say that customers who use Autobidder will continue to enjoy the full benefits of the Tesla warranty on their batteries.

AI & The Grid

Coincidentally, today’s email from Bloomberg Green is all about the use of artificial intelligence to manage the electrical grid and how it will change the dynamics that have become standard procedure over the past 100 years. In that email, Nathaniel Bullard says, “The future will not just involve a move from power systems with hundreds or thousands of large generators to systems with millions of small solar projects and wind turbines. It will also involve hundreds of millions of networked electric vehicles and also, potentially billions of networked sources of energy demand — things like lighting systems, boilers, and heat pumps.

“Their connections to each other have obvious value, from informing operators of conditions to transacting between parties. Energy transition networks at a scale of billions of things will be too big to be run only by humans. They will require artificial intelligence.” It sounds as if Tesla has already identified that trend and is designing new systems to manage the multiple parameters that will characterize decentralized mini grids and microgrids. My colleague Kyle Field sums it up nicely in a tweet:

“A new white paper from my BloombergNEF colleagues, the Deutsche Energie-Agentur (Germany’s energy agency) and the World Economic Forum outlines 15 functions that AI can perform for the energy transition,” Bullard adds. “Many of them are improvements on existing industrial functions that companies use today, from asset optimization and demand forecasting for renewable power generation, to designing and monitoring power grids.” The graphic that shows those benefits is at the top of this page.

Clearly, Tesla is prepared to lead the distributed renewables revolution as it prepares to significantly disrupt yet another industry. Elon Musk has said he expects revenue for the energy side of Tesla’s business to equal or exceed the revenue it generates from selling vehicles. The energy trading desk will play a major role in making that happen.

 

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