The Tesla Powerwall: Does It Really Mean The End Of Fossil Fuels?

May 8, 2015

When Steve Jobs tapped Tim Cook to be his successor at Apple, the man knew what he was doing. Cook is just as detail-oriented as Jobs was, and he's kept the company moving forward -- usually in interesting directions

However, there's one thing that Cook can't do quite as well as his late boss: headline product launches, which are increasingly important marketing tools in today's event-driven, video-centric culture. For help on that front, he might want to take some pointers from Tesla's CEO Elon Musk, who gleefully unveiled the Powerwall Home Battery last week.

To be fair, Musk is no Steve Jobs, either. Onstage, he's far too giddy, far too bro-ey, and he laughs at his own jokes. (A terrible habit. Looking at you Kenan Thompson. You too, Jimmy Fallon.) But there's no denying, the Powerwall debut was exciting, and the device itself is a thing to behold: beautiful, sleek, and powerful.

But here's the real question: does the Powerwall signal the end of fossil fuels, as some have suggested?

No. But also: yes.


Here's how the argument from eco-enthusiasts usually goes: energy from renewable resources like the sun, water, and wind makes up a small portion of humankind's total energy output. (For reference, such resources accounted for 10 percent of the U.S. total in 2014.) Of those, solar power is probably poised for the greatest growth because it's the most widely available. 

Unfortunately, our means of harnessing the sun's power and storing it for long periods of time are both limited. Powerwall solves one of those problems by creating an attractive, affordable way to store electricity. 

Is that a fair assessment? Sure. But it leaves out a few important details. Most importantly, the Powerwall isn't powerful enough to allow most of us to go off-grid -- at least, not with just one device.

The average U.S. home consumes around 30 kWh of electricity per day. The Powerwall will be offered in two versions: a 7 kWh for $3,000 and a 10 kWh $3,500 (plus the cost of an inverter and installation). So the average home would need between three and four of them to function off-grid, meaning that consumers would need to shell out around $15,000 or $20,000 for the devices, not including solar equipment.

In other words, the Powerwall is pricey -- too pricey for many homeowners to consider, even with tax credits. If that weren't the case, we'd probably have seen a run on similar (and similarly priced) devices, which have been available for some time.


However, the Powerwall does signify a shift -- a very important shift -- simply because it's beautiful. And as Apple has proven time and again, when companies make something beautiful, many people will want it -- even people who've shunned similar products before. The Powerwall turns battery power (from solar, wind, or any other source) from a geeky hobby into something that average Joes and Janes can handle.

Given the huge demand for Powerwall devices, competitors will surely follow. There will, in a matter of years, be a number of companies catering to people who want to purchase nice-looking batteries to power their homes, their cars, or serve as backup energy sources. Tesla knows this: that's why it's building the Gigafactory, to make batteries better, cheaper, and faster. 

The Powerwall is not the end of fossil fuels, though. It may not even mark the beginning of the end, which arguably happened over 60 years ago. Let's just say that it has arrived somewhere in the last chapter of fossil fuels.

But, oh, that last chapter is going to be a doozie. Consider the number of homes worldwide that will need products like the Powerwall. Consider the number of households who can afford those products (though prices will obviously drop over time, thanks to economies of scale and other factors). And consider the powerful oil, gas, and coal industry lobbyists who will fight the transition every step of the way.

Translation: don't sell off your stock in Shell just yet. 


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