Tesla's Trillion Dollar Weapon
Tesla is quietly building a trillion dollar weapon. Tesla built the world's largest Lithium-ion battery built in Hornsdale, South Australia, using Tesla's Megapack batteries. In its first year of operation, it saved $40 million and helped stabilize the electricity grid.
Enormous battery storage systems on this same scale are needed for renewable energy to be viable. Tesla's answer to this is Megapack. It's goal is to minimize the complexity of grid storage.
It comes completely constructed from the factory with up to 3 Megawatts of storage. By using Megapack, Tesla can construct a Gigawatt hour of energy 3 times faster than a fossil fueled station. It can also be connected to solar energy with less energy loss upon transfer.
Neoen, a French Energy Business, has revealed a 400 Megawatt project in Australia. This will be one of the world's largest energy installations. Tesla is revealing itself to be the world leader in stationary energy storage.
Expect more storage projects like this to happen as the years go by.
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Bigger Than the Car Business
Tesla Megapacks are an important part of Tesla's trillion dollar weapon. Tesla is now developing a Megapack farm in Australia's South West Queensland and this will have a capacity of 400 Megawatts.
It will give grid services and help to stabilize Australia's energy grid. Tesla has updated the Megapack to have more capacity. Elon Musk has said that the Megapack will help earth create a sustainable energy infrastructure.
The 2022 update can now store 3.9 Megawatt hours of stored energy. The primary use case is for utility companies because it can be charged from wind and solar energy. The Megapack can smooth out this energy for the gird when needed.
During peak energy usage, the Megapack can be drawn from to power homes and businesses. This is helpful when there are grid outages or there is more demand for energy.
The energy division for Tesla has not shown much more growth or profitability. But, there is a shift, and it happened when Tesla can now access all the supply it needs for the EV business and the Energy Business. The Energy Business grew 85% from the previous quarter.
Tesla had a record 2 gigawatt hours and then some in Q3, 2022. Most of this was from the Megapack and the PowerWall. Tesla's PowerWall is a smaller version of the Megapack for commercial use. It's not the primary driver of energy storage revenue though - Megapack is.
Tesla will continue to improve the density and scale of the Megapack, along with the software used to manage the Megapack. When 50% of utility companies are using Megapack with renewable energy, you are going to see Tesla's trillion dollar weapon making Tesla trillions. This is truly a sleeping giant. And, there's a 2 year backlog for orders.
Tesla will earn revenue for maintenance, recurring revenue for software services, and additional orders. What do you think of the Megapack? Is this a trillion dollar weapon for Tesla?
In Related News: Tesla FSD Finishes 2022 With 285K Users
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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.