Tesla's Musk discusses energy proposal with South Australian government

FILE PHOTO: A Tesla logo hangs on a building outside of a Tesla dealership in New York, U.S., April 29, 2016. REUTERS/Lucas Jackson/File Photo

US-AUSTRALIA-POWER-TESLA:Tesla's Musk discusses energy proposal with South Australian government

By Harry Pearl

SYDNEY (Reuters) - Tesla Inc boss Elon Musk spoke with the premier of South Australia on Saturday after the tech entrepreneur offered to install $25 million of battery storage within 100 days to prevent recurring blackouts that have disrupted the state.

The proposal follows a string of power outages, including a blackout that left industry crippled for up to two weeks and stoked fears of more outages across the national electricity market due to tight supplies.

"Just spoke with Premier of South Australia (Jay Weatherill). Very impressed. Govt is clearly committed to a smart, quick solution," Musk wrote on Twitter on Saturday.

Weatherill said in a statement on Saturday the conversation about the battery proposal was "positive".

Musk made the offer on Twitter on Friday, saying if the work was not completed in 100 days it would be free.

His proposal made headlines in Australia, which is in the midst of a heated debate about the national electricity market and energy security.

Musk proposed the battery storage fix in response to a comment on social media by Mike Cannon-Brookes, the co-founder of Australian software maker Atlassian Corp.

Cannon-Brookes said he would be willing to line up funding and political support if Tesla could supply batteries that would solve South Australia's problems.

Musk responded by tweeting: "Tesla will get the system installed and working 100 days from contract signature or it is free. That serious enough for you?"

He quoted a price of $250 per kilowatt hour for 100 megawatt hour systems, which would imply a price of $25 million for the battery packs.

(Reporting by Harry Pearl; Editing by Sam Holmes)

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