Tesla Motors’ CEO Elon Musk appeared on stage Thursday night to announce “Tesla Energy” — a line of expensive batteries “for homes, businesses, and utilities fostering a clean energy ecosystem and helping wean the world off fossil fuels.”
But more than that, the company is rebranding itself from a simple electric car company to an “energy innovation” company. Energy storage is their new market, and they hope to lead the way in helping the world to cut carbon dioxide emissions.
“We have this handy fusion reactor in the sky, called the Sun,” Musk told people at an event in Hawthorne, California Thursday night, adding that the world needs storage batteries that don’t “suck.”
Musk says Tesla has the solution: the Powerwall. It’s a home battery that allows homes, businesses and utilities to store energy from solar panels or the electrical grid during non-peak hours to be used when electricity demand is highest. This could lower energy bills and make green energy much more competitive with fossil fuels.
“The Powerwall is available in 10kWh, optimized for backup applications or 7kWh optimized for daily use applications,” Tesla says on its website. “Both can be connected with solar or grid and both can provide backup power. The 10kWh Powerwall is optimized to provide backup when the grid goes down, providing power for your home when you need it most. When paired with solar power, the 7kWh Powerwall can be used in daily cycling to extend the environmental and cost benefits of solar into the night when sunlight is unavailable.”
The only problem for consumers is that Tesla is selling its Powerwall to installers for “ $3500 for 10kWh and $3000 for 7kWh” and that doesn’t include the price of an inverter or installation. It’s definitely not something your everyday American will be rushing out to buy, but it could be the first of a long line of storage batteries.
Energy storage is what green energy advocates and environmentalists say is necessary to make wind and solar power competitive with fossil fuels like coal, gas and oil. Wind and solar aren’t reliable sources of power because they are intermittent — the sun doesn’t always shine and the wind isn’t always blowing.
Battery storage, however, would enable people to store solar energy, for example, built up during the day to be used at night when power demand is spiking. This could allow consumers to offset their energy bills.
But battery storage’s application is not limited to just green energy, fossil fuels can also store energy on batteries for later use. A home with a battery can simply store power from the grid in the same fashion as a home with a solar panel. Both systems can create energy savings.
This could be a big breakthrough, but before you go jumping up and down there are some huge hurdles to overcome. The main one is cost. Musk is charging up to $3,500 for these batteries — about what the average American household spends on electricity in nearly three years.
Tesla’s Powerwall battery: • Price: $3,000 – $3,500 • 51″ x 34″ x 7″ • Delivery in 3-4 months http://t.co/HaLZ17M4SW pic.twitter.com/lj5xi4vubb
— CNBC (@CNBC) May 1, 2015
Costs for batteries are predicted to come down as more are manufactured, so that may be a problem that goes away. Another problem Musk has is he’s really selling the battery as an extension of solar power (likely in a bid to help SolarCity, in which he’s the main investor), but rooftop solar hasn’t exactly caught on yet.
Most people aren’t buying solar panels for a variety of reasons. One reason is that panels have expensive, long-term leases and another is that rooftop solar can hurt your home’s value when you go to sell it.
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