Tesla Powerwalls for Home Energy Storage Hit U.S. Market
To Steve Yates, the best thing about his new Tesla Powerwall is that he doesn’t have to worry anymore about the lights going out during a storm. Or maybe it’s how cool an addition it is to the entryway of his house in Monkton, Vermont.
“I’ve always wanted to have a backup power source,” said Yates, who was without electricity for 36 hours during Hurricane Irene in 2011. He also admires the Powerwall’s sleek white contours. “It’s kind of art-deco looking.”
A year after Elon Musk unveiled the Powerwall at Tesla Motors Inc.’s design studio near Los Angeles, the first wave of residential installations has started in the U.S. The 6.4-kilowatt-hour unit stores electricity from home solar systems and provides backup in the case of a conventional outage. Weighing 214 pounds and standing about 4-feet tall, it retails for around $3,000. But hookup by a trained electrician is required, as is something called a bi-directional inverter that converts direct-current electricity into the kind used by dishwashers and refrigerators. The costs add up quickly — which has fueled skepticism about Musk’s dream of changing the way the world uses energy.
Net-metering policies, which allow residential solar customers to sell their excess solar electricity back to utilities, have limited the appeal of home batteries in many states. But that’s shifting: Net metering is being phased out in some states, making storage more attractive.
“The picture is rapidly changing across several markets,” said Yayoi Sekine, an analyst for Bloomberg New Energy Finance. “Changes to net-metering policies and implementation of time-of-use rates will improve the case for residential energy storage systems going forward.”
Sales Emerging
For Yates, money wasn’t an issue: he got his unit for free from Green Mountain Power as part of a pilot program. Tesla has said it anticipated the unit quickly growing to a multibillion-dollar business, and some people are clearly willing to pony up. Snapshots of early Powerwall installations in Australia, South Africa and Europe have begun popping up on social media by customers who want early bragging rights. Mark Kerr of Wales describes himself in his Twitter profile as the “First Tesla U.K. owner of fully operational Powerwall battery unit and it feels good.”
Tesla’s Powerwalls — and the larger Powerpacks for businesses and utilities — are made at the company’s gigafactory for battery production east of Reno, Nevada. The two products are part of Tesla Energy, which is its own business unit. In the first quarter, the unit delivered more than 2,500 Powerwalls and almost 100 Powerpacks in North America, Asia, Europe and Africa, Tesla said Wednesday in a letter to shareholders.
“It’s starting to ramp up,” said JB Straubel, chief technology officer and a member of Tesla’s founding team, in an interview at the gigafactory. “They are going in all around the world. It’s happening.”
Customer Range
Consumer interest runs from rural residents eager for an alternative to diesel generators to Tesla loyalists who support the company’s mission of accelerating the transition to sustainable transportation and are forgiving of the company’s notorious product delays. Powerwall deliveries were originally supposed to begin last summer.
Rosemary Brisco of San Mateo, California, is among those seeking the trifecta: a Tesla in the driveway, solar panels on the roof and a Powerwall to optimize both.
“We put off going solar until there was a way to back it up,” said Brisco, who has driven a silver Model S sedan since 2013. “Now we’re going solar and getting a Powerwall at the same time.” Installation is set for next week.
The market for Tesla Energy also includes utilities that want to better integrate renewable energy and make their grids more efficient. Some are selling or leasing Powerwalls directly to ratepayers.
Sales Model
It’s a business-model switch for the Palo Alto, California-based company that’s best known for its electric vehicles. Tesla sells its cars directly to consumers, without dealership intermediaries. But with roughly 3,000 utilities in the U.S. — each with different rate structures — the market for home energy storage is fragmented and hard to predict. So in a departure, Tesla has teamed with utilities, solar companies and others to get Powerwalls into people’s homes.
