NCPA - National Center for Policy Analysis

Tesla Becomes the Harbinger of Doom for Utilities

May 14, 2015

It is rare to see a new product, which could fundamentally change the way average Americans live, today is certainly not that day. However, upon announcing the Powerwall and Powerback (a battery designed to power homes, business and public utilities), Tesla innovators shined the media's light on the 800-pound gorilla, which has been staring American utility companies squarely in the face: batteries. Tesla is by no means alone or a first-mover in the battery market, with the construction of similar manufacturing facilities underway by mega-giants such as BMW, Ford, Chrysler, Nissan, BYD in China and Bosch in Germany.

So why was this announcement important for utilities?

To survive, electrical production companies need a way to outcompete battery manufacturers while updating much of America's aged and unreliable transmission infrastructure. Without this, or a significant decrease in the cost of batteries, the grid may become an expensive necessity only the poor and middle-income are relegated to. 

Source: Santiago Bello, "Tesla Becomes the Harbinger of Doom for Utilities," National Center for Policy Analysis, May 13, 2015. 


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