Tesla and the South Australian government have teamed up again -- this time bringing solar energy and Powerwall battery storage to 50,000 homes, at no cost.

Premier Jay Weatherill announced the launch of the Virtual Power Plant on Sunday, which will use energy generated from rooftop solar panels to power the entire state.

The move comes as Tesla’s 100-megawatt battery in Jamestown South Australia, which famously came to be thanks to a Twitter bet between Mike Cannon-Brookes and Elon Musk, continues to provide the state with back-up power.

“My government has already delivered the world’s biggest battery, of now we will deliver the world’s largest Virtual Power Plant,” said Weatherill.

“We will use people’s homes as a way to generate energy for the South Australian grid, with participating households benefitting with significant savings in their energy bills.

“Our energy plan means that we are leading the world in renewable energy and now we are making it easier for more homes to become self-sufficient.”

Each participating household will be provided with a 5kW solar panel system and a 13.5kWh Tesla Powerwall 2 battery for free, with the sale of the electricity back to the grid to finance the project.

The Tesla Powerwall 2 battery will soon be in 50,000 South Australian homes. Source: Tesla

The rollout is being funded by a $2 million grant from the state government and a $30 million loan from the Renewable Technology Fund.

Energy from the solar system is first used to power the house on which it is installed, with excess energy moved to the grid.

The battery network, which is set to be the biggest of its kind in the world, forms the Virtual Power Plant, able to distribute the surplus energy into all homes, potentially driving down energy prices for the entire state.

Completion of the project would create a 250-megawatt power plant, which Weatherill explained could lower energy bills by 30%.

While Tesla is providing the batteries for the scheme, the South Australian government is currently seeking a private retailer to join the project as official Program Retailer.

“What this project will do is connect thousands of solar and battery systems to make one giant, coordinated virtual power plant,” said Energy Minister, Tom Koutsantonis.

Although free, tenants do not technically own the solar panels and batteries, rather they are simply leasing their roof space to the Virtual Power Plant.

A trial of the system has already begun, with 1,100 Housing SA public housing properties participating.

Following the trial, systems will be rolled out to 24,000 public housing properties, before being offered to all South Australian households.

The government’s goal is to connect at least 50,000 households in the next four years.

Residents can register their interest to participate here.