Tesla Motors just released the iPad of energy storage.
The electric automaker on Thursday unveiled a line of rechargeable lithium-ion batteries -- the sort used in the electric automaker’s Model S sedans -- meant to store solar energy and power homes and businesses. The sleek, wall-mounted devices collect excess energy from solar panels throughout the day for use at night.
The batteries, due out this summer, come in two variations. The commercial-scale Powerpack, currently getting a test run at 10 retail stores across the U.S., can be used by businesses. The consumer model, the Powerwall, will sell for up to $3,500 and could rev the nascent energy-storage industry’s engine.
“It’s the iPad of stationary storage,” Jay Whitacre, a professor at Carnegie Mellon University and the chief technology officer at the sodium-ion battery company Aquion Energy, told The Huffington Post. “Tablets were out there and no one really wanted them. Then came the iPad.”
As with Apple’s iconic tablet, Tesla -- armed with CEO Elon Musk’s starpower -- could make solar-storage batteries fashionable. Though the company already has a considerable field of rivals, including tech goliath Samsung and Swiss battery startup Alevo, which raised $1 billion in private funding last year, none have generated the same amount of attention as Musk. On stage at a Tesla facility outside Los Angeles on Thursday, the product launch was akin to a new iPhone announcement.
But the real challenge will be to make owning the home device economical.
The first problem is the cost. At $3,500 each, the batteries are expensive. And since each one is limited to storing 10 kilowatt-hours of electricity, many homeowners would need to buy several in order to power their homes fully. Tesla is building a $5 billion plant in Nevada, dubbed the Gigafactory, which will produce lithium-ion batteries en masse. But, until then, the price will remain high. To boot, homeowners would have to bear the cost of installing solar panels or wind turbines to charge the batteries in the first place.
The other issue is the current electricity rate structure in the United States. Here, electricity is more expensive during the day, when solar panels generate energy, and cheaper at night. Utility companies will buy consumers' excess solar generated during peak hours and recirculate it into the power grid, then sell it back at a cheaper night rate, when solar panels aren’t producing energy.
Therefore, there's little incentive for people to use solar-storage batteries that hang onto energy during the day if they could be selling it at peak prices to the utility companies and buying it back later on the cheap.
“It only makes sense for storage if it’s more expensive to buy electricity at night and sell it back during the day,” Brian Warshay, an analyst for Bloomberg New Energy Finance, told HuffPost. “But most people aren’t on those types of rates.”
Germany, on the other hand, does offer those rates. The country encourages the use of solar storage by charging high rates for electricity drawn from the power grid in the evenings.
Some states have pioneered models similar to Germany’s. Hawaii has the highest electricity rates in the country, at over 30 cents per kilowatt-hour. Rates in New England are also high, topping more than 20 cents per kilowatt-hour.
But, across the U.S., the average price of electricity was about 12 cents per kilowatt-hour in February, the most recent month calculated by the U.S. Energy Information Administration.
“For the most part,” Warshay said, “grid electricity is just really cheap.”
At the moment, then, Tesla's new batteries stand as something of a proof of concept. But if the company can decrease its manufacturing costs, and if states start pricing electricity more aggressively, Musk's vision of a solar-powered future could become a reality.
Our 2024 Coverage Needs You
It's Another Trump-Biden Showdown — And We Need Your Help
The Future Of Democracy Is At Stake
Our 2024 Coverage Needs You
Your Loyalty Means The World To Us
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
The 2024 election is heating up, and women's rights, health care, voting rights, and the very future of democracy are all at stake. Donald Trump will face Joe Biden in the most consequential vote of our time. And HuffPost will be there, covering every twist and turn. America's future hangs in the balance. Would you consider contributing to support our journalism and keep it free for all during this critical season?
HuffPost believes news should be accessible to everyone, regardless of their ability to pay for it. We rely on readers like you to help fund our work. Any contribution you can make — even as little as $2 — goes directly toward supporting the impactful journalism that we will continue to produce this year. Thank you for being part of our story.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
It's official: Donald Trump will face Joe Biden this fall in the presidential election. As we face the most consequential presidential election of our time, HuffPost is committed to bringing you up-to-date, accurate news about the 2024 race. While other outlets have retreated behind paywalls, you can trust our news will stay free.
But we can't do it without your help. Reader funding is one of the key ways we support our newsroom. Would you consider making a donation to help fund our news during this critical time? Your contributions are vital to supporting a free press.
Contribute as little as $2 to keep our journalism free and accessible to all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. Would you consider becoming a regular HuffPost contributor?
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. If circumstances have changed since you last contributed, we hope you'll consider contributing to HuffPost once more.
Support HuffPostAlready contributed? Log in to hide these messages.