Utilities are racing to expand battery storage on the electrical grid.

The latest example is Pacific Gas and Electric Co., which submitted a request Friday to the California Public Utilities Commission to build and install four large banks of lithium-ion battery storage, according to the San Francisco Chronicle.

The projects would include Tesla's largest installation yet of commercial-scale Powerpacks, a 182.5-megawatt station within PG&E's Moss Bay substation in Monterey County.

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Tesla would design and install the battery backup, then turn over its operation and ownership to PG&E.

The substation, along with the four other locations, power large sections of Silicon Valley, which was hit by large-scale brown-outs in 2003.

"Recent decreases in battery prices are enabling energy storage to become a competitive alternative to traditional solutions," said Roy Kuga, vice president for grid integration and innovation at PG&E. "As a result, we believe that battery energy storage will be even more significant in enhancing overall grid reliability, integrating renewables, and helping customers save energy and money.”

Tesla Powerpacks

Tesla Powerpacks

The California Public Utilities Commission in January encouraged PG&E to accelerate bids for energy storage projects, and these are the first the utility has proposed since then.

The Tesla project is slated to deliver 182 megawatts over four hours from 3,000 Tesla Powerwall 2 battery packs, according to a report in Electrek, to meet peak loads on summer afternoons.

The contract notes that the project could be expanded to provide six hours of storage, or as much as 1.1 gigawatt hours.

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The other three PG&E projects are being built by other companies, including a second project at the Moss Landing substation, one at a third-party electricity provider, and a fourth at a customer site. Together, they can produce 568 megawatts of power. The Tesla installation is the second largest.

Tesla CEO Elon Musk hinted at the project in the company's last earnings call on July 6, saying, "I feel confident that we’ll be able to announce a deal at the gigawatt-hour scale within a matter of months." The Moss landing project, if expanded to six hours, would meet that description.

At a media round-table in Japan, meanwhile, a Panasonic executive said the company would increase its investment in Tesla's Gigafactory, which builds the Powerpack batteries as well as batteries for the automaker's cars, if Tesla asked. Panasonic has already pledged $1.6 billion toward the cost of the $5 billion factory.