Tesla’s Home Solar System Price Drops

Image credit: TESLA website

Reuters report a cut in the prices of residential solar systems of Tesla Inc in the range of 15-25 percent, effective last Thursday. This translates to a price drop between $3.000-$5.000 depending on the system’s size and location.

Tesla’s senior vice president of energy operations, Sanjay Shah, announced that the reduction in price can be attributed to streamlining the company’s sales’ operations. In 2016, Tesla acquired SolarCity, to leverage its installer workforce and Panasonic’s panel efficiency and to move towards providing integrated energy solutions, from batteries to solar rooftops. SolarCity ran an extensive sales network which contributed to almost half of solar sales but increased the costs per installed system. Tesla has ceased selling door-to-door and at Home Depot Inc. stores, focusing on sales through its website and its own retail network. This re-orientation in sales strategy allowed for the announced price reduction, which Shah expects to counter the drop in solar system installations.

The drop in installations reflects also the deployment of the much-waited solar roofs. Solar roof shingles are building-integrated photovoltaic (BIPV) products of high durability, that function as solar panels and are combined with non-solar roof tiles to build a solar roof. Following relative delays, twelve solar roofs in the U.S. have been connected to the grid as of May 2019, and the start of mass production was moved to 2019. Utilities like the Powerwall electrical battery which can support electrical supply during outages have seen an increase in pricing during this year, even though Powerwall still offers the highest energy density battery for the lowest available price.

Tesla representatives note the superior quality of their solar panels which can justify their higher price compared to standard products. They suggest that the announced drop in their residential solar systems intends to make them more affordable, adding that the company aspires to become the lowest-cost solar provider in the US.

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