Elon Musk is at it again.
Most casual observers thought the giant lithium-ion battery Gigafactory being built by Tesla Motors (TSLA) was all about the electric car market.
That’s… mostly true. But it’s also about so much more.
Musk also plans to use the Gigafactory to produce batteries that can power private homes, and even larger structures.
The company’s Chief Technology Officer, JB Straubel, believes the market for stationary batteries “can scale faster than automotive,” and could account for up to 30% of the Gigafactory’s battery output.
Rumors about the company making the major shift into stationary batteries have been around for a while. But, they weren’t confirmed until the evening of April 30 by Musk at a Tesla event.
Storage and the New Grid
What’s so big about this news is that these batteries may very well become a key component in the grid of the future.
More and more homes, businesses, and utilities are using renewable energy. But the major problem with energy sources, like solar and wind power, is that power generation can be intermittent.
These batteries can be used to combat the surging nature of renewable energy by storing electricity during peak productions times and then releasing it when it’s needed.
The battery system, unveiled by Tesla yesterday, is similar to what has already been available to about 300 customers of Solar City (SCTY), a company that Musk chairs. These units can be leased for an initial outlay of $1,500, with a payment of $15 per month.
Musk unveiled two batteries for the home: the 10-kilowatt capacity Powerwall and the 7-kilowatt capacity Powerpack. The cost is $3,500 and $3,000, respectively.
The Powerwall is intended to provide back-up power for the home while the Powerpack can be used to run everyday refrigerators and TVs.
In the corporate world, Tesla battery back-up systems have already been installed by both Apple (AAPL) and Google (GOOGL) at their corporate campuses. The company has also launched a pilot program with Wal-Mart (WMT). No price was stated by Musk for the business products.
