July 7, 2016 Paul Lee

Tesla, Solar City, and the Future of Home Energy

Photo credit: Business Finance News

Elon Musk is probably one of the strongest proponents for sustainability today. His first strategy to reduce carbon emissions was to phase out inefficient combustion engines through the mass adoption of electric vehicles. Now, as evident from Tesla’s merger with Solar City, Musk’s second strategy is to strategically supply green power to the grid.

Musk wants to accelerate the adoption of electric vehicles through Telsa, home batteries through the Power Wall, and solar panels through the acquisition of Solar City. By bringing together these three components under one house, it enables the potential for full home energy management systems. Though there is a mixed response in terms of the business case for the merger, what are the technical motivations behind it? It all has to do with the future of smart homes, the grid, resiliency, and cross compatibility of services.

How Would It Work?

During the day, a home’s solar panel would power the home and charge both the home battery and your electric car. At night, the battery would discharge, providing energy to the home and any additional energy your car may need for the next day. This way of managing energy allows residents to become less dependent on the grid because your home would be able to supply and manage its own clean energy.

Motivations for a Combined Service

The connection of a solar PV system and a home battery is important not just for sustainability, energy independence, and resiliency during black outs, but also economic viability. The way solar is currently being marketed to residents is through program called net metering. How it works now is that when a home has excess solar energy, it sells back to the grid and the owner gets paid for that energy. But what happens when there are too many people with solar panels and there is no one to sell back to when there’s an abundance of solar? This is a problem that will plague both the home owner and the utility. In fact, many utilities are trying to dismantle the net metering program, thereby eliminating the viability of solar. With so many solar installations coming online, the way to keep solar economically viable in the future is to be able to store its energy. The following article provides additional insights.

Moving forward into the future we envision a scenario where homes become smart. Our appliances are connected and speak to each other. As of right now we have smart refrigerators, smart TV’s, smart thermostats, and now smart cars. A current problem in deployment of these advanced future home technologies is how to integrate all these pieces of tech. Most people have access to the internet and smart phones but the problem is that all these pieces of technologies exist in silos with not a lot of cross compatibility or communication amongst them. For instance, Apple sees a market for this and has launched their HomeKit in order to consolidate all the various components.

Tesla falls under the umbrella of smart homes and home automation. Tesla aims to bridge several branches: the car, battery, and solar PV system. By unifying these components, you can have one provider bringing an elegant and effective home energy management system that is environmentally friendly, energy saving, and digitally controllable at the palm of your hand.

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Photo credit: Tesla Motors (2016)

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