Tesla largely responsible for slide in U.S. home solar sales

https://www.reuters.com/article/us-tesla-solar/tesla-largely-responsible-for-slide-in-u-s-home-solar-sales-report-idUSKBN1E915A

by callwaiting • 9 years ago

96 90 9 years ago

reuters.com

mtgx• 9 years ago

But under Tesla’s ownership, the company has largely stopped its aggressive marketing campaigns and ambitious expansion.

From what I heard, that was more like "aggressive salesmen." Perhaps Musk wanted a different more Tesla-like approach to sales, then the sleazy salesman persuading you to make the purchase at all costs. Even if that strategy results in more revenue in the short term, maybe Musk thought he doesn't want Tesla to be known for that type of purchase experience.

TheSpiceIsLife• 9 years ago

Off topic. Did you intentionally use the word then after the comma in the second sentence in the second paragraph "then the sleazy salesman"?

I see this a lot here on HN where I assume the word should be than. Is this some regional dialect quirk?

azernik2• 9 years ago

In most American accents, the two words are homophones, so misspelling one as the other in writing is quite common.

35bge57dtjku2• 9 years ago

No, people are just lazy. It's not like people don't mix up the two in other regions.

amluto• 9 years ago

Instead they've gone for the very nice Tesla experience. You put down a deposit and no one contacts you for a month. You ask for specs (architectural and performance) and get squat. You call them and the sometimes return your phone call. You ask whether they can give a rough install date and you get squat.

It's a roof for Pete's sake. I'm a bit surprised anyone puts up with this crap. A shoddy underspecified solar install above a roof is one thing. An actual roof, that's supposed to be waterproof and such, is rather different.

lafar6502• 9 years ago

Ha ha good luck if you plan to build a new house- maybe there are regions where you can live few years without a roof

enjo• 9 years ago

Utilities across the country are changing how they handle net metering (buying back at the wholesale instead of retail rate). It greatly changes the payback on these solar installations... I’m guessing that has more to do with any slowdown than Tesla’s management. Not to mention that the low hanging fruit may already be largely picked.

latj• 9 years ago

Yes. This is exactly what is going on. In the same time period described the power dinosaurs (Google autocorrected companies to "dinosaurs" but it kinda fits in more than one way so I'm keeping it) have implemented polices to slow down adoption of PV claiming they can't build the infrastructure fast enough to hold the growth but all the while just hoping to figure out a way to remain relevant while not embracing any kind of change.

narrator• 9 years ago

Wait till the masses discover cryptomining as an alternative to measly net metering rates.

travmatt• 9 years ago

If that shifts the mining away from large datacenters run by coal, would that be a net benefit for society/environment?

city412• 9 years ago

I have solar and generate far more electricity than I could ever use. I investigated cryptomining as a way to use up that electricity, and no matter how I crunched the numbers I couldn't make it profitable.

ghaff4• 9 years ago

Anecdotally, the door-to-door sales and the aggressive sales guy camped out at the entrance to Home Depot seem to have largely gone away. I suspect it's a combination of, as you say, a less attractive financial payback and the fact that people who really want to do it have already done it.

(I'm not sure what the tax incentive situation is. As I understand it, that's still in place.)

dawnerd• 9 years ago

I really want to get it even though I missed out on some of the savings, but really doesn’t make much since here in Portland. My house is basically always in the shade.

It would be huge if I could run my homelab without worrying about how much power I’m eating up.

throwawaylalala• 9 years ago

I live in Florida. Almost no solar here. Lots of fruit to be picked.

annamargot• 9 years ago

It’s my impression that this is from utility companies blocking solar.

https://www.rollingstone.com/politics/news/the-koch-brothers...

rconti• 9 years ago

California's "Net Metering 2.0" basically gives you net metering credits in Time-of-Use (ToU) "buckets" which means you don't get the full credit you would have gotten under Net Metering 1.0 if you generate the most from, say, part peak hours of 10am-3pm, but use your air conditioning during peak hours from 4pm-7pm.

But from everything I've read, this means I'd actually come out ahead if I had solar on my house. I don't have air conditioning, so much of my usage is constant demand, plus some lighting and TV and such late into the evening, plus laundry and other appliances, also typically later in the evening (after the 7pm peak ends). But the solar would be generating me TONS of part-peak during midday and even a fair bit of peak hour generation at 4-5 and even towards 6pm as the sun goes lower angle.

I'm really curious and interested in doing it, just never went so far as to invest in solar.

I wonder if the falling SolarCity installations means panels and labor have fallen in price a bit?

castratikron2• 9 years ago

What we need is a new grid, one that's designed to move power in any direction. The current grid was built to move power in one direction, from the plant to the home. If we set up a grid that allowed home-to-home transfer of electricity, we'd be able to support an energy market where the price of electricity is set by market forces instead of centralized utilities. Any producer of electricity can put his or her power on the market and compete with everyone else, and consumers can shop around the market for the best prices. It would be the internet analogue of power delivery.

This is not some kind of libertarian dream world. This infrastructure will have to be created and maintained by the government, just like roads. There will probably have to be laws to regulate sale and prevent things like monopolies and non-discrimination. But otherwise whatever happens on this infrastructure will be more or less "free" for the market to decide.

If our answer to climate change is for each home to be essentially an island responsible for maintaining all of the solar/wind infrastructure to meet their own power needs, then we're doomed. We need to be able to move and price power efficiently, and the current model of delivery is broken.

dfox• 9 years ago

Simplest way to make this technically feasible is to switch from AC grid to DC grid, which is not exactly small change.

On the other hand running your whole house on 290-310V DC is surprisingly simple (in places with 230V mains) beacause most typical home devices either don't care at all or have SMPS which rectifies mains voltage to DC. Probably only large-ish home appliance that needs AC is european-style (two knobs and big transformer) microwave oven.

johnmarcus• 9 years ago

yup, its exactly this. shame on Reuters. that article felt as if it was paid for by big oil.

mrfusion• 9 years ago

How hard would it be to buy some land and build a solar farm? As an investment.

nine_k• 9 years ago

How hard would it be to sell this amount of electricity? What kind of a transmission line would it take?

dv_dt• 9 years ago

Add some data center capacity for a cryptocurrency co-lo.

njharman2• 9 years ago

Doing that would be easy, doing that at a profit is hard.

There's a reason windfarms are being built instead of solarpanelfarms.

mcbutterbunz• 9 years ago

I'm not that knowledgeable in this subject, but is it because wind farms provide dual land use? The footprint required to erect and maintain turbine is much smaller and allows existing farmland to continue operation.

philipkglass• 9 years ago

In some countries it's much harder to build a profitable solar farm than a profitable wind farm. Both are viable in much of the United States.

In 2016, the US installed 8203 MW of wind power:

https://www.awea.org/wind-energy-facts-at-a-glance

It installed ~14000 MW of solar PV, including about 10000 MW of utility scale projects:

https://www.seia.org/solar-industry-data

Given the higher capacity factor of utility-scale wind over solar, wind still has the lead in effective electricity supply added in 2016. But both are being built. Through Q3 in 2017 in the US, solar is actually way ahead of wind in terms of capacity increases. Q4 usually dominates the year for both wind and solar, so it remains to be seen if that's true with full-year data. Large scale solar construction in the US could slow down significantly in the near future depending on how harshly the solar module import tariffs/quotas derived from the Suniva ITC case are set.

vbuwivbiu• 9 years ago

I'm a big fan of solar power, but solar farms are a waste of land; put them on roofs and over parking lots instead

xyzzyz• 9 years ago

Solar farms are definitely waste of land in urban areas, however US has plenty of land that is pretty much unusable for anything else than solar power generation.

elihu• 9 years ago

Land isn't such a scarce resource when you get outside the city. A centralized solar farm is cheaper to install and easier to maintain than installing on roofs and parking lots.

If people want solar on their roofs or in their parking lots, then by all means they should install it, but if your goal is to deliver the cheapest cost per killowatt-hour, then finding some vacant land away from people and putting up a lot of panels is a good plan.

pjc503• 9 years ago

That depends entirely on your local permitting regime and what arrangements you can make for selling the power. And what latitude you're at.

chrisgd• 9 years ago

SolarCity was acquired because it was running out of money. There where a lot of questions whether Tesla over paid for the asset because of Elon musk's ownership in both companies. Not having any more money to spend on aggressive expansion might be the biggest reason for the decline

zer00eyz• 9 years ago

"Tesla declined to comment for this story, but has previously said that while sales are down, margins are up. The company expects its fourth-quarter solar installation numbers to be higher than those of the third quarter."

Lets assume what your saying is true, as is the above statement (and the article hints that there was concern about the debt model solar city was using).

The decline in sales and the increase in profits look like there is an attempt to right the ship, rather than persist with a model that doesn't function well.

prepend• 9 years ago

Profits are increasing because they stopped expensive marketing and promotion to attract customers. Solar city was actually losing money with new customers.

So just by Tesla stopping new customers they increase their income.

njharman2• 9 years ago

According to article SolarCity was also largely responsible for the boom in home solar sales and in building the market and lifting up other solar companies.

agumonkey3• 9 years ago

Any physicist around here ?

to challenge musk/solarcity claims about the 100km² solar farm being equivalent to the world energy output. Energy transport aside of course, just as a napkin calculation thing.

hwillis• 9 years ago

The 100 km^2 aka solarcity's "blue square" is US electrical output, not world and not total energy. There's a 36x difference between the two.

US insolation is around 5.5 kWh/m^2/day. For a non-tracking array in Arizona it's about 6.5-7 [1]. Total energy collection would be almost 10^20 joules with 100% efficiency. US electricity consumption is about 1.4 * 10^19 J [2] so it would only require solar panels with 15.5% efficiency. Average is around 17%.

[1] https://www.nrel.gov/gis/solar.html

[2] https://en.wikipedia.org/wiki/Orders_of_magnitude_(energy)

agumonkey3• 9 years ago

Thanks, I probably misread US electric as something more. Sorry.

If it's national, the 36x isn't that big of a factor. There are other locations with high solar input (africa, australia, middle east).

ridgeguy2• 9 years ago

I'm a little foggy this morning, but here goes:

If 100km^2 is read as an area (not a square 100 km on a side), that's 1e8 m^2. Assuming an average of 500W/m^2 daytime insolation over 8 hours and an average conversion efficiency of 20%, that's about 1e9Watts (1 GW) average output over 8 hours, or 8GW-hr/day of energy.

Assuming 365 days/year, I get about 2.9e4GW-hr/year, or about 29 TW-hr/year.

Wikipedia [1] gives the total energy used by civilization in 2013 as about 157 PW-hr, or 157,000 TW-hr. The same source estimates electricity generation alone was estimated at about 19,500 TW-hr in 2013.

So 100km^2 of solar panels looks like it could produce about 0.15% of humanity's 2013 electrical energy production or about 0.0186% of humanity's total 2013 energy generation.

If the initial solar array dimensions should have been read as 100km x 100km, then its output would be 2 orders of magnitude larger. This would bring its output to 15% and 1.86% of 2013 electrical and total energy generation, respectively.

YMMV - these are only napkin calcs, not reviewed for error or fatal simplification.

[1] https://en.wikipedia.org/wiki/World_energy_consumption

agumonkey3• 9 years ago

No worries, thanks a lot for answering already. I should have looked deeper into wikipedia already.

Also you're right it's 100x100(miles even)² (https://www.inverse.com/article/34239-how-many-solar-panels-...)

echo_oddly• 9 years ago

Average power of radiation over the whole earth is 164 W/m^2 according to https://en.wikipedia.org/wiki/Sunlight. Global power consumption in 2013 was 18 TW (1.575 × 10^17 Wh/y) according to https://en.wikipedia.org/wiki/World_energy_consumption. So 164 W/m^2 × 100×10^6 m^2 = 16.4 GW. That's a factor of 1000. But that's comparing to the average solar radiation striking the Earth. Are there places such as a desert which receive 1000 times the energy of the rest of the earth?

35bge57dtjku2• 9 years ago

There are places that are closer to the equator.

myrandomcomment• 9 years ago

Waiting for the solar roof tiles. Put money down to hold a place in line. Still waiting....

ilaksh• 9 years ago

The incredibly obvious thing that somehow most people are not connecting here is the solar shingles or roofing tiles. They can't continue to push the old-fashioned panels with the same enthusiasm at the same time as launching the solar shingles. Combine that with the fact that they are the only producer of those particular tiles that they are selling and have a bottleneck, and I think that explains it.

There are other non-celebrity companies that make solar shingles, see at the bottom of this article: https://en.wikipedia.org/wiki/Solar_shingle

blunte• 9 years ago

This article completely fails to mention several other potential factors:

- some states have reduced or removed subsidies to home owners for new solar installations

- solar installations are expensive and take years to pay themselves back (and ultimately become a net gain); but homeowners are staying in one home for shorter periods than in the past, making long-term planning less attractive

- some utilities have pressured local governments to block or make difficult new solar installations because of (real or perceived) problems with pushing a lot of power back into the grid from the endpoints (homes)

- political misinformation campaigns have convinced some simple folk that solar is bad (or is un-patriotic since some regions, such as Texas, are so deeply connected to oil and gas)

How much of a role these other factors have played is up for debate, but I think it's rather disingenuous of Reuters to not even mention some of these.

perseusprime112• 9 years ago

Solar will go big when interest in home ownership goes away due to innovations like Uber which is reducing long term car ownership or multiple car ownership. Once home ownership goes away and we can subscribe to smart, intelligent homes powered by solar and other renewable energy sources, it will begin the golden age of Solar. Unfortunately, we are still 20 years away from this vision.

perseusprime112• 9 years ago

The lack of property tax deductions in the new tax bill could accelerate this vision.

newman8r• 9 years ago

That's an interesting thought on home ownership being disrupted.

My vision for the future is that the combination of dropping solar costs, the ability to work remotely, and the high cost of home ownership will open up new areas of land for communities to develop where it was not feasible before.

Combined with other trends like tiny homes, 'van dwelling', etc, it seems to make sense: people want to live high quality lifestyles without the high cost.

I picked up 5 acres in the california desert for a few thousand dollars, I lived there in a trailer for a while and learned a lot - I'm convinced it will become more popular as people start to realize it's doable.

pjc503• 9 years ago

home ownership goes away

Home ownership is the only practical way in which the general public can access leveraged asset price inflation. There has to be big transformation in the economy before home ownership is seen as a cost centre rather than the most profitable investment most people will ever make.

mitchellberry• 9 years ago

Solar and even moreso batteries are advancing so quickly that waiting for further price deflation seems a logical choice for many.

It's the energy equivalent of holding out for next gen cpu's.

pooya13• 9 years ago

None of these factors (although relevant to the article) would explain why TESLA has lost market share compared to other solar companies.

UncleEntity4• 9 years ago

TFA says investors were concerned about the amount of debt SolarCity was carrying so when Tesla bought them they pivoted more towards commercial properties.

gwern• 9 years ago

Yeah, it's quite an omission. Why is SolarCity doing fewer installs? It's a mystery. Don't ask - we have no idea! They just aren't.

nsnick• 9 years ago

Texas is actually deeply connected to wind now. https://qz.com/1103816/texas-wind-power-capacity-will-overta...

greglindahl3• 9 years ago

Wind and solar are complementary -- so that's not a reason for solar to be less popular.

hodgesrm• 9 years ago

I would also not omit the fact that an increasing number of utilities offer solar power options. This is how Google consumes solar power for its data centers.

caseysoftware• 9 years ago

Texas is one of the top producers of wind and top 10 or so for solar. We produce energy in all forms.

I tried to get solar on our house ~3 years ago. The roof is angled a few degrees too far north so we didn't qualify for any federal, state, or local subsidies or tax credits. I'd love to do it but the numbers don't work out that way.

log_base_login• 9 years ago

Not that this necessarily applies to your situation, but for those who might otherwise be dissuaded, it is very doable to install solar panels on the ground to accommodate what requirements exist regarding the incident angle of solar radiation/absorbtion.

I actually find it surprising that your utility finds that to be a deal breaker as it would only limit your ability to generate electricity by a few percent per skewed degree.

xbmcuser• 9 years ago

The prices have fallen a lot since then what might not have been economically feasible then might be today 3 years is a long time in solar tech.

dmh2000• 9 years ago

'aggressive marketing tactics'. in other words, high pressure salesmen making dubious claims

coliveira• 9 years ago

Thankfully, the future of solar technology doesn't depend on the USA anymore. China is the biggest producer of solar panels, and will continue to employ solar technology for its internal development. These factors will make the US adoption irrelevant for the development of solar technology.

WheelsAtLarge• 9 years ago

Linkbait, they don't mention that Solar city was drowning in debt. There was no way it could continue its aggressive marketing. It's one of the reasons it's no longer an independent company. The reduction is not a reflection of Tesla but a reflection of the overall market. People just are willing to spend the thousands of dollars or perpetual lease to power their homes. Like it or not, the switch to solar or similar is for the large utilities to do it. But they won't do it unless they are forced to do it. California has started but its now time for the rest of the country to pass some laws.

greglindahl3• 9 years ago

The main reason is that Tesla -- and only Tesla -- is switching business models from having investors put solar panels on house roofs and selling the power to the homeowner, to the homeowner buying panels. This transition has been going on for the past 4 quarters.

The article discusses it here:

SolarCity’s rapid growth was fueled in part by a no-money-down offering that enabled residential customers to pay a monthly fee to go solar. The business generated huge sales volumes but led to investor concern about debt.

and it's easy to see, from the published financials, that this is a large effect.

Tesla largely responsible for slide in U.S. home solar sales

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