Brian Tucker / Utility Dive
Tesla is continuing to make energy storage a key part of its business. Chief Financial Officer Zach Kirkhorn said on Monday’s call that the energy business had comparable margins to Tesla’s more mature electric vehicle arm, although the utility-scale storage Megapack product still needs more work.
However, Tesla’s solar business has been hit with some criticism, with Electrek reporting in March about customer complaints of massive increases in installation prices. Musk admitted Monday that the company had made some “significant mistakes” with the solar roof project, which seeks to replace a building’s roof with solar tiles. The price volatility, he said, reflects a realization that the “complexity of roofs varies dramatically,” adding that some more complex installations were canceled and the customers saw their deposits refunded. The shift to combine solar and storage for all customers, Musk said, will streamline installation by ensuring that all the power generated goes to the battery system before reaching the house’s circuit breaker, while also making strides to shore up the grid.
“We can be working with utilities to use our Powerwalls to stabilize the overall grid,” Musk said, pointing to the recent mass outages in Texas. “Effectively, the Powerwalls can operate as a giant distributed utility. This is extremely powerful and necessary,” especially as more people adopt electric vehicles that demand more power.
Musk also said that a software update for the Powerwall could enable as much as a 50% power increase than the 5 kW of real power currently advertised for units sold since November.
Overall, Tesla exceeded Wall Street expectations for revenue, posting a record quarterly profit even amid supply chain disruptions to its car business because of the COVID-19 pandemic and a global semiconductor shortage. The company reported record production and deliveries of its electric vehicles and executives said they are on pace to exceed 2020 deliveries by 50%.
Jeff Windau, a senior equity analyst with Edward Jones, said the Q1 earnings were a “good, positive note” for the company, especially for the energy business. “We believe they’re going to continue to grow that out,” Windau told Utility Dive, adding that he sees energy storage as a “key part of their story.”
Musk also said he is bullish on the ability to fight climate change and rapidly deploy solar and wind power, especially with wider deployment of stationary storage as battery technology improves. “Sustainable energy is being solved,” he said, “it only matters how fast we solve it.”
