Cars are a much higher margin way to sell storage than selling it without the attached car. Or at least that has been the justification in the past for Tesla prioritizing shipping cars over more grid storage.
I don't think that's changed, as grid scale storage is a cut throat market. Maybe residential storage paired with solar will have higher margins, but the limit there is regulatory, and there's also ample competition in the solar market.
Which is to say, cars really seem to be Tesla's best bet and core driver of other value, IMHO.
Hmm. This is a bit of a silly comparison, but Tesla will sell a Megapack with 1.9MW, 3.9MWh for about $2M, “ready to install”.
Signature Solar has an 18kW, 61.44kWh battery plus inverter setup for about $22k. If you could buy 64 of these, you get just over 3.9MWh and 1.15MW for about $1.4M.
Tesla’s system presumably operates at a nicer 480V and is intended to scale larger, but the cost isn’t amazing if you pretend this is apples to apples.
Utilities and energy developers buy solutions, not parts. Megapack + Autobidder is turnkey. Also, cost sensitive buyers are not a great cohort to market to; market to folks with capital to spend and who understand the value prop. Let someone else chase garbage margins. Price is what you pay, value is what you get.
> Also, cost sensitive buyers are not a great cohort to market to
…
> ("Tesla’s little-known Autobidder product has already made over $330 million for energy investors")
A lot of investors looking for returns would love to save 30-40%. I also wonder whether Autobidder, which is hosted on Tesla’s cloud, would actually be very exciting for grid operators who value reliability and things like black start.
Anyway, my real point is that I’m comparing apples to oranges, but Tesla’s value proposition in the energy sector doesn’t look unassailable to me. If I worked at a company like EG4, I would seriously consider trying to compete.
When real competition presents itself, the discussion will be material. Engineering culture is hard to cultivate, no utility is going to write an autobidder replacement. Utilities can barely do anything besides put RFPs out for generation, maintain their distribution networks, and operating their IT systems for billing and grid management. Some even fail at that (US PG&E).
This is like saying "all of these slow moving, conservative, entrenched, low paying organizations can compete with software companies if they just tried." And if horses could sing. Engas has terrible enterprise fundamentals to try to create an engineering culture ($$$) to obtain market leverage [1].
TLDR Culture and resources matter to innovate and deliver. The stars must align.
I don't think that's changed, as grid scale storage is a cut throat market. Maybe residential storage paired with solar will have higher margins, but the limit there is regulatory, and there's also ample competition in the solar market.
Which is to say, cars really seem to be Tesla's best bet and core driver of other value, IMHO.