Tesla and SolarCity

The Tesla fanboys were so sure that this merger was going to change the face of power generation. Didn’t really work out that way. MIT Technology Review: Tesla’s trumpeted solar shingles are a flop.

But then I’ve always believed that Tesla (and Musk) were “all hat and no cattle” when it came to solar. For a couple of reasons.

The first is tied up with the reality of what has happened since the merger.

In the more than two years since Tesla acquired SolarCity, its overall solar installations have plummeted by more than 76%.

A Tesla spokesperson told Reuters it’s “actively installing” the Solar Roof product in eight states but declined to discuss its purchases from Panasonic or provide overall installation numbers.

At least they seem to have learned the lesson from the SEC: Don’t embellish the truth.

Those numbers aren’t really a surprise, given the state of SolarCity before the merger. Elon Musk just kicked his shareholders in the teeth. (This is from Business Insider in 2016.)

Now, in case you haven’t been following the SolarCity story, it’s the company that, a few minutes before this deal was announced, Goldman Sachs said was the “worst positioned” for growth in its sector.

So why would someone with no real experience in a business-turnaround capacity, buy such a company? It may only be a coincidence…

It’s also a company that is helmed by Elon Musk’s cousin, Lyndon Rive. Go figure.

Though the stock was down 60% in the year before the merger was announced. Maybe he thought it looked cheap.

Back to the MIT article linked at the top. It looks like Tesla won’t meet the employment numbers it committed to at its “gigafactory” to avoid the penalties inherent in that deal. Though they have another year to get there.

Last year, Tesla ended its months-old retail partnership with Home Depot, and shuttered a number of solar installation facilities. It’s reportedly cut thousands of workers in its solar division since the acquisition. The team also faced difficulties with the appearance and performance of the Solar Roof tiles.

A Bloomberg article late last year said Tesla was operating just one production line at the Buffalo factory, rather than the multiple lines that were supposed to be running at that stage.

And then there is the little issue of actually having a product to sell.

The team also faced difficulties with the appearance and performance of the Solar Roof tiles.

The other reason I always thought Tesla’s move into solar was a joke? (This is not covered in either article.) Musk talked about using his very expensive, lightweight lithium-ion battery technology in homes and businesses. In your phone you want a light battery. In a car you also want to reduce weight. In a building that doesn’t move, why is weight an issue? (Hint: It’s NOT.) In a building that doesn’t move, the issues are cost, life-span, and durability. Long-lasting, cheap batteries, that don’t have a tendency to catch on fire are most desirable. Most homes that rely on solar get by with good old-fashioned lead acid batteries. (Invest in the automatic watering setup!) Want to take a step up? Then there are Nickel-iron batteries. There are also Lithium-iron batteries, which are not lightweight, and not sold by Tesla, that some industrial applications use for backup. (Think cellphone towers in remote locations.) None of those examples move, so weight – critical in applications that specify lithium ion batteries – is basically ignored.

4 thoughts on “Tesla and SolarCity

  1. Excellent summary, especially that last paragraph about batteries.

    The reality of solar power is miles from the hype being sold. There’s intermittency, inefficiency, and the need to clean them regularly. They’re really only practical in the desert. Photovoltaics make sense if you already have all the power generation you need, and have more money than sense.

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    • They also make sense for marine and RVs (off-road style RVs) where you can be sure you WON’T have access to mains power.

      I had as much solar as I could squeeze onto my boat. (37ft sailboat). It was enough to run lights and some navigation equipment. It couldn’t keep up with refrigeration.

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    • For the absolute worst on what has been done with solar, take a look at Australia. And they actually have a lot of real estate where solar works. The problem? The grid can’t handle that much fluctuation. And the .gov dismantled a lot of “traditional” generating power.

      The upshot is that electricity has become unreliable and crazy expensive.

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  2. Right with you on the sailboat. The solar constant is around 1 kW per square yard. Unfortunately, you’ve got to figure on something like 20% efficiency, or 200W per square yard. If you can’t make sure your panels are perpendicular to the sun it’s even worse. I’d guess that your sailboat might have had enough square yards to buy a kW, but not much more than that.

    It can be eye-opening to instrument a solar panel and watch the power change when even thin cirrus clouds get in the way, let alone passing cumulus.

    I see the Australians voted out their Labor Party and pundits say their climate change policies were one of the big reasons.

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