"Tesla’s most disruptive product may not be its cars"

"Tesla’s most disruptive product may not be its cars"

This just showed up on my LinkedIn home page. I don't know anything about "Quartz", its source, and can't vouch for it one way or the other. But it's an interesting perspective:

drbchy | 21 februari 2014

I better buy more Tesla stocks!!

AlMc | 21 februari 2014

Once the analysts and general stock holding public finally figures out that TM is an energy company that happens to make great cars the stock will really take off.

Captain_Zap | 21 februari 2014


Isn't that what the gigafactory is all about?

AlMc | 21 februari 2014

cZap: yes, but many analysts have yet to figure out the true worth of TM is that it is not just disrupting the auto industry but more importantly the energy production (with solar..SCTY) and
storage (good by electricity bills) companies.

if people think the auto dealers are giving TM a hard time..wait till we see what big oil, natural gas and coal companies have to say.

Dramsey | 22 februari 2014

Tesla's not an energy company, because they don't, you know, produce and sell energy. Nobody thinks Panasonic is an energy company.

A battery is a storage medium. All the windmills and solar panels at the factory will be used to run the factory, not produce power for sale.

Personally, I think one of their most disruptive things might be the weakening of the franchised dealer model.

AmpedRealtor | 22 februari 2014

Tesla is not an energy company and being an energy company is nowhere in its sights. Solar City is an energy company, not Tesla. The name of the company is Tesla Motors, not Tesla Energy. Elon's vision for Tesla is to further sustainable transport, as he has said repeatedly. He has never stated his goal for Tesla to be an energy company.

Solar City is a separate company from Tesla, but the two sometimes are conflated because Elon sits on the Board of Solar City while his cousin (or other relation) is their CEO.

cb9 | 22 februari 2014

Isn't that disruptive though? A non-energy company that competes with energy companies?
I keep hoping electric companies will wake up, partner with solar city and tesla and explore v2g as a way to displace oil and gas - I have to think they might have a huge upside for doing so.

Jolinar | 22 februari 2014

yes, but Elon is Chairman and has the biggest share in the Solar City. Also Elon never said that Tesla is energy company, but he is always talking about how he wants to revolutionize energy industry - both consumption (TSLA) and production (SCTY). And with giga-factory, Tesla will become supplier for Solar City.

Dramsey | 22 februari 2014

@cb9: How is Tesla competing with energy companies?

SamO | 22 februari 2014
Kleist | 22 februari 2014

@Dramsey - Tesla/SolarCity aren't competing with electrical utilities, but working with them - distributed generation thanks to solar is comming anyway, but doesn't fit in the current centralized power distribution system. Distributed storage can make it happen. Give me a 40 kWh local storage system for my house for $10k lasting 20 years and I can be energy neutral... I even let the utility manage the usage. That home storage system I expect to become available around 2018... the giga factory will make the price and capacity possible.

SamO | 22 februari 2014


Sorry to disagree but Solar City is not competing yet but will. Look at the resistance put up just by California (the most progressive energy system in the US).

Kleist | 22 februari 2014

@SamoSam - you see it too short term, sure there will be pain with the utilities. Government mandated solar, now it is mandating storage. Tesla can provide a service to utilities and that will pay off long term.
The real disruption is on the electrical generation/distribution side and so the challenge for Tesla is how to work with the utilities in particular as they are PUC controlled.

SamO | 22 februari 2014


I am not the one with short term thinking. Distributed energy production is a utility killer.

Just ask the utilities in Germany that have seen decreasing revenues. Or Hawaii.

The writing is on the wall that citizens won't need a utility company if they have solar and battery backup.

Utilities make their biggest margins on peaker energy production. That peaker energy will not be needed with distributed storage.

Dramsey | 22 februari 2014

Solar City can be considered an energy company since they produce residential PV systems. And their partnership with Tesla is interesting. The battery storage systems are new but will remain expensive niche products for the foreseeable future.

Still, I think the cars and selling model are much more "disruptive"; it's not as if residential PV didn't exist before Solar City.

Dramsey | 22 februari 2014

@SamoSam: Interesting tidbit in the third cite you posted...

The reason, according to the Hawaiian Electric Co.: so many Hawaiians are stampeding to solar that circuits may become oversaturated, causing voltage spikes, damaging appliances, electronics and even the utility’s equipment.

Hm. Remember how I was saying that widespread adoption of PV could lead to problems with the unpredictable appearance and disappearance of lots of power into a grid that wasn't designed to handle it? And that what we needed was grids that were designed to handle it?

SamO | 22 februari 2014

According to HECO that's the case. According to independent auditors, not so much.

SamO | 22 februari 2014

And BTW battery backup would solve ANY problems.

Kleist | 22 februari 2014

@SamoSam - but we agree that a (or THE) major disruption will happen at the electrical system level - how utilities will be able to cop with it is another question. Not all US utilities are hostile, I had a PG&E engineer out at my house before I even ordered the car and he was very supportive, but explained the challenges ahead. My local distribution could not handle even 10% EVs... it is designed for 1 kW continues and 3-5 kW occasional peaks ( dryer, A/C ). Some years ago it was very hot for days and all the local transformers popped... and only 1 in 5 homes have A/C here. If you want to keep the current electrical system there would be a monumental upgrade of the last mile distribution needed.
I am aware of the German situation ( I am German living in the Bay Area ) - uncontrolled subsidized solar and wind, but storage was overlooked... now how to tame the beast. Elon made quite a while ago a little remark that Germany was his most important market - it can't be cars, but the Germans need his batteries systems.

bonaire | 23 februari 2014

The OP linked story cites Morgan Stanley analysts. They appear to be the underwriters of the offering that will monetize the activities of the gigaplant, so, they will be bullish at this point. :)

bonaire | 23 februari 2014

By the way, there are perhaps more grid storage companies in existence as competition for batteries and large MW units already for sale. And Li-ion battery storage for renewables continue to be less optimal for grid storage than other form factors. From molten salt to pumped hydro to other forms. The best way to do it is at the point of production of large utility scale renewables such as wind farms and MW arrays. Not individually at each small rooftop installation. Hawaii is a bad example because it is a true utility island and not a much larger national grid. Companies like ABB and other very large electrical component suppliers will surely lead and are already doing grid storage. ABB owns Power One, maker of PV inverters. They have a partnership with Panasonic for battery storage systems already for sale which are partnered up with their inverter solutions. That is only one example. I just think a lot of you guys need to delve deeper into this industry.

lolachampcar | 23 februari 2014

Speaking from a S. Floridian viewpoint, the tipping point will come when PV + battery costs fall below grid supplied power. Once this happens, capital costs will be wrapped into the cost of the house and the utility will no longer be needed.

So, when does that happen?

Inverters work today and can get much better (and cheaper) should the market grow dramatically. PVs are there from a price standpoint and too will improve with volume. The ONLY thing that is missing to enable a transition is home based storage.

Once again, Elon has returned to the fundamentals of a problem, identified the constraints and is working to address them.

Sure there is going to be kick back from all those that would loose. However, the one true benefit that the US has over so many other places in this world is that private enterprise can create disruptive technologies to displace entrenched interests more efficiently. There will be lobbying by those entrenched entrusts but a lot more of that activity happens in the sun shine in the US thus the odds of people as a whole affecting the discussion are increased. Ours is not a perfect system but, in this instance, I think it is one of the better systems.

lolachampcar | 23 februari 2014

Oh, and I forgot to mention the whole reason for AC is the ability to distribute power efficiently. If power is generated and stored locally via DC, there is no reason the primary power consumers in our houses will not migrate towards DC to eliminate the inverter losses inherent in supporting a legacy AC based infrastructure.

Brian H | 24 februari 2014

Check out the % of power which is residential and that used by industry. It's not as simplistic as you describe.

Baribrotzer | 24 februari 2014

@ lolachampcar -

What voltage of DC?

That is not a trivial question. Most computer and home entertainment gear uses multiple DC voltages internally, and those are easy to produce from AC wall power. But with DC home power, everything would either have to run upon one agreed-upon voltage, or you would again need to use inverters, or the solar-and-battery system would have to supply several positive and negative voltages. Any of which, I would argue, will reintroduce all the complexity and losses you'd save by going to DC.