Tesla Motors plans to add a new revenue stream by manufacturing batteries for home and business power storage systems. But the quest won’t be easy, owing to stiff competition in the market to garner customers and government subsidies, which are key for growth.
Tesla CEO confident
Tesla CEO Elon Musk, however, said Tesla Energy will outperform the competition by offering an integrated system for generating solar power and storing it onsite. Musk, at a recent company event near Los Angeles, said, “We’re just not aware of who would even really be second, honestly.”
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Analysts note that the multibillion-dollar market is still in its nascent stage as power companies, businesses and home owners are gradually responding to government incentives, purchasing systems and stabilizing the grid. Musk can be rightly known as one of the most powerful salesman in the world, but it is not just Tesla that is offering such systems. Experts believe the price of the home storage battery pack from Tesla is $3,000, which is similar to what others are offering.
Many players with similar offerings
Some of the most renowned namesm such as Samsung SDI Co. Ltd, LG Chemicals and Saft Groupe, are giving direct competition to Tesla by producing products similar to those of the EV manufacturer. These companies are also making small batteries with solar panels at homes and businesses and bigger ones to support utilities’ pent-up grid reliability, says the report.
Not just big names, but small players are also entering the field. Stem, a company that integrates batteries into software systems for businesses and is backed by Total and General Electric, won a big contract last year with California utility Southern California Edison. Tesla and SolarCity are as of now shipping a small quantity of storage systems, and competition for the limited subsidies is seeing a rise.
In 2011, the situation was largely in favor of Tesla, when the company and SolarCity were alone in claiming incentives for onsite storage systems in California, says the report, which cites state data. But this has changed , and players like Coda Energy, Stem and Green Charge Networks are taking a major chunk of the projects as per the data.