The Purchase of Solar City by Tesla Will Have a Big Impact in Australia

Jon Capistrano
Jon Capistrano
June 26, 2016

If you’re a Tesla user now, it’s possible that you may have a garage with cars loaded with lithium-ion batteries. With the possible acquisition of Solar City could see Tesla add Tesla Energy solar panels to your roof and a Tesla Powerwall to the wall as reported by Tech AU.

Tesla has recently announced plans to acquire Solar City, the United States’ number 1 solar provider, which is also co-founded by Tesla owner Elon Musk. Tesla says their goal is to fast track the world’s shift to sustainable transportation by offering affordable electric vehicles. They believe an important factor of that strategy is to set up an end-to-end solution.

The US Company has not made their presence in Australia yet, but the company employs 14,000 people. If the acquisition is approved at $2.8B, then it will have big significance for the Australian solar market. At present, Tesla’s business model for Powerwall is to sell through existing energy retailers like Australia, Natural Solar and Origin Energy.

If Tesla Energy brings solar solutions to the country, it will see a different landscape as energy storage becomes more important for making the solar economics work. Serious reductions in feed in tariffs will mean that traditional solar installations are becoming less viable, even though technology, PV panel efficiency and inverters are improving.

When you talk to owners of an all-electric vehicles, they usually say that they wish to have a couple of solar panels on the roof of the garage and charge the car using it, which leaves the owners off the grid for their electric car needs. If this philosophy extends to all of the power used in a home, it will be more viable and will be more cost efficient with an end-to-end solution. Across Australia, we have seen energy prices go up and households turn off any non-essential appliances to save money. This puts in doubt about the viability of smart homes of the future and technology that improves the lives of many Australian households.

Just imagine your home with the right balance of solar collection and energy storage, this means that you can add any number of gadgets that consume power 24/7 without thinking of the cost, because essentially it will be free. This will be something Australia may experience is Tesla Starts selling solar. This will also further increase the competition and creative opportunities to allow more people into the solar power industry. As of this time, there’s no plans that Tesla would stop offering Powerwall through any competing providers.

The upfront cost may be too expensive for many households and it can double if you add solar battery storage into the system. To counter this, many providers are experimenting with long-term leasing or a rent-to-own solutions that doesn’t need any down payment, with a commitment to buy power from a retailer within 20+ years. In the United States, Solar City has an option where the owners can payoff solutions over 10 or 20 years. The no down payment scheme is basically a loan, so while people may not think of Tesla as a financial institution, they will after they have acquired Solar City. Any owners who will choose this option will be charged fixed monthly payments.

Click here to read the full story on Tech AU and here to read the letter of the Tesla Acquisition on Tesla Motors

Image credit: Tesla

 

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