Smart Energy

Chapter 3. Enter Tesla

In the spring of 2015, Tesla made a splash by officially announcing its entrance into the stationary energy storage market. It introduced the Powerwall and its big brother, the Powerpack—rechargeable lithium-ion battery solutions that can meet storage needs large and small. Interestingly, according to Q2 2015 report of the U.S. Energy Storage Monitor published by GTM Research, there were at least two dozen energy storage system vendors operating in the US marketplace at the time. Considering the healthy competition already in this space, why would a car manufacturer throw its hat in the ring?

“Tesla already knows how to do this. They’ve been putting LiFePO4 batteries in their cars for years. They have the experience,” said Randy Perretta. By 2014, Tesla and its supplier, Panasonic Corporation, were already producing enough lithium-ion battery packs to outfit each of the approximately 35,000 vehicles it manufactured that year. The technology, materials, and know-how necessary to develop a stationary energy solution are so similar that Tesla is banking on economies of scale to drive down the cost of production for car and facility batteries alike as its production ramps up.

Another advantage Tesla had upon entering this market was an established customer base. Tens of thousands of customers own Tesla Roadster and Model S electric vehicles (EVs). It’s likely many of them are interested in charging those EVs at home using renewable energy. A 2015 PlugInsights ...