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Tesla Will Disrupt Centralized Power Companies, says Morgan Stanley

SolarCity and Tesla Gigafactory - The End of Power Companies as we Know Them?
SolarCity and Tesla Gigafactory – The End of Power Companies as we Know Them?

Tesla Motors may be more than an electric vehicle automaker, according to financial services corporation Morgan Stanley.

Morgan Stanley says that Tesla could actually end up disrupting centralized power companies as we know them, but how? Tesla is not just a car company, and neither is SolarCity just a solar panel company. In the end, they are an entirely new way to look at renewable energy and transportation. SolarCity, of course, is a solar power company, whose solar panels help to defray the costs of powering homes and businesses, as well as reduce their associated carbon footprints.

Of course, SolarCity, by itself, can’t fully eliminate one’s dependence on the power grid, the energy generated at some faraway place and delivered via overhead and underground power lines. The problem is that the sun isn’t consistent in power output, at least from our perspective where we’re trying to generate renewable energy from it. Renewable energy intermittency is one of the biggest obstacles to a fully renewable power grid, which is where Tesla comes in.

Tesla, you see, is not a car company, but an energy storage company. True, they put big lithium-ion batteries in the Tesla Model S, but they also make lithium-ion backup batteries for homes and businesses. Tesla backup batteries are the perfect combination for SolarCity solar panels, enabling some homes to completely disconnect from the grid, which has power companies worried. Morgan Stanley says this could be the beginning of a spiral effect, in which fewer grid customers will drive up power prices for grid-tied customers. Rising grid-power prices will drive even more customers to decentralized renewable options, such as SolarCity and Tesla backup batteries, which will, in turn, drive grid-power prices up even more.

Construction of the Tesla Gigafactory, which will produce some 80 GWh of lithium-ion battery capacity every year, only 50 GWh of which is planned for electric vehicles. The rest of that capacity is for renewable energy backup power, and could eliminate the conventional power producer’s business model forever.

Photo credit: Kevin Krejci

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  1. Bob Wallace Ladson

    Et al:  My point is I don’t trust stock analysts even if they are right because they have an agenda dictated by their bankster.  The idea is always to move a stock in a preferred direction.

    I myself strive for as much independence from ongoing payouts; and, If the numbers worked out for me, I would be the first to cut the cable to the transformer.

  2. Ladson

    Perhaps you should pay some attention to Australia where rooftop solar is disrupting  their conventional power producer’s business model.  And Australians are starting to add storage to their homes which will further disrupt.

    We’re witnessing a great shakeup in the world of energy, at least those of us paying attention are….

  3. Ladson well, i wouldn’t put it beneath them to do so. after all, we can thank financial companies for practically every depression and recession. on the other hand, i wonder if there’s a grain of truth to their claims.
    there are already net-zero homes on the market, which would require just solar panels and backup batteries to drop right off the grid. the real question, i think, has to do with how many people are actually prepared to invest in renewable energy and backup energy storage systems.

  4. Pay no attention to these guys.  Morgan Stanley makes money by churning the stock market and betting on the ups and down of stocks.  This time I would say they are short on Tesla stock and are trying to drive the stock down.


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