What A Tesla + Solar City Future Looks Like - Swell Energy

Introduction

Musk says that uniting Tesla with SolarCity has been part of his "Master Plan" to provide customers with a one-stop-shop for energy, storage, and consumption. In Musk’s words, SolarCity merging with Tesla would create "the world’s only vertically integrated sustainable energy company."

Earlier this year, Tesla CEO Elon Musk proposed a merger between his electric vehicle company, Tesla, and the solar energy company SolarCity, which was originally founded by his cousins, Lyndon and Peter Rive. For the Tesla/SolarCity deal to go through, it had to be approved by both Tesla and SolarCity shareholders. On November 21, the deal was finally done.

Implications of the Merger

Musk says that uniting Tesla with SolarCity has been part of his "Master Plan" to provide customers with a one-stop-shop for energy, storage, and consumption. Merging Tesla with SolarCity means that Musk can scale his products in an unprecedented way, cutting R&D and overhead costs, resulting in hopefully big savings in the market. The deal also allows Tesla to appeal to his eco-conscious audience under one united brand.

Though the merge won’t be without its challenges, the deal fits with Musk’s style of movement, change, and growth within Tesla. If there was ever a CEO who had mastered the art of keeping shareholders and customers excited about the unlimited possibilities of the future, it would be Elon Musk. His new product launches and announcements, especially those surrounding his energy storage projects like the Tesla Powerwall home battery, have been inspiring and electrifying. Musk maintains both understated mannerisms and captivates his audience, getting them on board to whatever big destination Tesla is headed next. Yes, Elon Musk has an infectious presence, but he can’t make it on charisma alone. To really succeed, Tesla needs to churn out some big numbers.

Recent Performance

The most recent profit reports released by Tesla are giving shareholders a confidence boost. Tesla announced that it turned a profit of $22 million last quarter while the US oil industry managed to lose $67 billion last year due to low gas prices. These stats put Tesla in a great position, but it hinges on several factors, including the success of the merger with SolarCity. The future of Tesla also depends on a large chunk of the Nevada desert with the Gigafactory.

Much of Musk’s net worth has been put at stake with the Tesla Gigafactory. When finished, it will be the largest building in the world by footprint. The Gigafactory is a clear, visual example of how ambitious Elon Musk is and his very high hopes for the future of Tesla. If everything goes according to plan, the factory will churn out 150 gigawatt hours of batteries every year, enough for 1.5 million Tesla Model 3s. The end goal is to drive down the cost-per-kilowatt hour of batteries to an unprecedented low, making Tesla’s cars and lithium-ion batteries more accessible and affordable to a wider customer base.

Affordability and Accessibility

Affordability and accessibility will be huge assets to Tesla as they unveil their renewable energy-fueled products. Traditionally, products relying on renewables, like solar panels and home batteries, have been geared toward a more affluent crowd. Tesla is starting this shift with their new solar roof.

Just minutes after the shareholders approved the Tesla/SolarCity merge, Musk made another announcement about the newly unveiled solar roof. He claims that Tesla’s solar roof will actually cost less to manufacture and install than a traditional roof. Many customers were doing the math, factoring in the savings on their electrical bills from generating their own electricity. The power generation, Musk says, is just a bonus.

Musk posed the question, "Would you like a roof that looks better than a normal roof, lasts twice as long, costs less and generates electricity?" Traditional, cheap asphalt shingles are heavy and bulky, leading to high shipping costs and product loss due to breakage. Tesla expects its tempered-glass roof tiles to hold up much better during transportation and to be cheaper and easier to ship due to their lighter weight.

Looking Forward

Merging Tesla and SolarCity is another step toward bringing solar and energy storage products into the mainstream. The future of clean, dependable energy depends on widespread adoption of renewable energy generation and storage. Driving down costs through vertical integration, cuts in overhead, and durable, easy-to-ship products will introduce new price points to a wider population. When the price drops low enough for average households to afford Tesla’s products, the last barrier will be an educational one.

The benefits of adopting new technology like solar panels and energy storage batteries go beyond luxury and excitement; they also offer a way for homes to protect their own power.

We have built a thriving society that depends on a functional electrical grid. Most Americans rely on the power grid to energize daily activities. Without electricity, every system that sustains our society would break down, both individually and structurally.

It’s time to rethink how we protect our power instead of relying solely on a vulnerable grid. Energy security can be found by harnessing the sun's free energy daily and storing it in batteries for later use.

Tesla’s products give homes the ability to secure their own energy. A Tesla + SolarCity future could mean energy security for all.