Superchargers Potentially a Revenue Source

mbhaddad · May 30, 2013

With the announcement of grid storage being added and the announcement that tesla is working with local grid operators I see potential in the chargers actually becoming profitable as a large scale demand response product. The storage for 1 site was stated at 1mw with 300 total charge stations the capacity is 300mw which is equivalent to 3 100 MW Combustion Turbine plants. Image in 2017 when there are 1000 stations. 1000mw is equivant to 1/2 of all enernoc's demand response under management in 2009, they had revnue of 100M that year so i'd assume to see a 50M in revenue for tesla @ 1000 stations. What are your thoughts?

Mark

callmesam · May 30, 2013

mbhaddad said:
With the announcement of grid storage being added and the announcement that tesla is working with local grid operators I see potential in the chargers actually becoming profitable as a large scale demand response product. The storage for 1 site was stated at 1mw with 300 total charge stations the capacity is 300mw which is equivalent to 3 100 MW Combustion Turbine plants. Image in 2017 when there are 1000 stations. 1000mw is equivant to 1/2 of all enernoc's demand response under management in 2009, they had revnue of 100M that year so i'd assume to see a 50M in revenue for tesla @ 1000 stations. What are your thoughts?

Mark

Mark,

You are leaving out one revenue stream. Solar. Each of the 1000 stations in your example would be solar so that the energy PRODUCED as well as stored, should be added to the revenue stream of Tesla. Elon said that the energy produced should be net positive. No way yet to quantify net energy produced without outlandish speculation.

Ok.

The Hawthorne Supercharger has a 5x20 solar canopy with 100 panels. If each panel is 100 w, then the installation is 10kW system. Might produce 8,000 kWh per year. If you can maximize time of use to charge the batteries at night, and discharge to grid during the day, then you could get a 4-10x amplification in buy price of $0.035/kWh to $0.20/kWh sell price.

toastypasta · May 30, 2013

I'm not 100% sure which announcement (conference call) this happened on but i am pretty positive that Musk stated that they are energy positive. they are actually sending energy to the grid thus creating cash.

Though IMHO i'd think that all that cash would be put towards maintaining the Superchargers as well as paying any rent/leases/taxes for land of the Superchargers. The more stations created, the more costs involved so i'd only hope that they make enough revenue sending energy into the grid to actually pay for any station costs so fill ups remain free for Tesla drivers.

moltenfire · May 30, 2013

But how long is it going to take to recoup the $300,000 cost of each Supercharger? 8000kWh/yr * $0.20/kWh = $1600 a year. This sounds like it's going to take a LONG time for a return on investment (and this is excluding the cost to buy or lease the land).

TI Sailor · May 30, 2013

Hopefully my math is okay. If not, I'm sure someone will quickly tell me.

$2000 built into each car for SC activation x 20,000 cars/yr x 5 yrs = $200,000,000/$300,000 per SC = 667. Assume 75% take rate on SC activation = 500 SC's. A good start to the network I think... :smile:

Grendal · May 30, 2013

In long term, Elon is for EV adoption. He has stated forever that part of reason for creating Tesla was to push the major manufacturers into creating EVs. I can see a time that he would allow, for a fee, other manufacturers cars to use Superchargers. It would degrade some of Tesla's exclusivity but it would improve EV adoption.

It wouldn't happen for a number of years and it would probably start with manufacturers that Tesla provides the drive train for.

So possibly another stream of revenue for Tesla.

mitch672 · May 30, 2013

Your all missing the point; the "end game" and how Tesla really plans to make money long term displacing the ICE is in licensing SuperCharger access to other EV manufacturers, after they prove it works and become the undisputed leaders in long range EVs, it's all laid out in gory detail in this Randy Carlson "Seeking Alpha" article from March, he even calculates what a SuperCharger visit is worth, and concludes with "Tesla can make more money from giving away free electricity, then they can from making cars", it's well though out:
SuperCharging Tesla - Seeking Alpha he even mentions grid tied batteries and rate arbitrage.

haid · May 30, 2013

moltenfire said:
But how long is it going to take to recoup the $300,000 cost of each Supercharger?

The real question is how many cars will each Supercharger sell near term, and long term. It is advertising that benefits the Model S owners. And it makes the Model S more useful.

marvinat0rz · May 30, 2013

Would be fun to crunch the numbers on peak vs. bottom electricity pricing in the US. Battery storage has always been considered not economically viable, but with this scale it becomes a relevant question. Could one of you Americans dig up the pricing of electricity per kWh during peak demand and lowest demand during a day? I'm thinking along the same lines as mbhaddad, buying electricity when it is cheap and selling it when it is expensive. While at the same time maintaining good charge on the packs in the Supercharger station, this is guaranteed to be a revenue source. The question is how big, which we could calculate.

Johan · May 30, 2013

Just don't forget that the main reason (I would presume) for the battery packs on the SC stations is not to charge them at night and then selling it back to the grid during the day, but instead to be able to charge more cars at peak hours without having a super-beefy grid connection and the associated demand fees.

marvinat0rz · May 30, 2013

Yes, I would assume that, along with helping offset the cost of operating the Supercharger stations themselves. Tesla won't be subsidizing their car owners, they are going to profit or at least be close to break-even on this system. Otherwise it isn't viable in the long-term. But it seems like they've thought of this. I'm really impressed with the execution and level of thought that has done into these decisions - hopefully I'm not just staring myself blind and missing something important.

mbhaddad · May 30, 2013

I'm particularly thinking about when cars are not using the system. Just as grid storage with no energy in them they are very valuable to the ISO/RTO's in the world as purely a place to store and retrieve energy on/off peak.

Cattledog · May 30, 2013

Much more likely each panel exceeds 200 watts.

callmesam said:
Mark,

You are leaving out one revenue stream. Solar. Each of the 1000 stations in your example would be solar so that the energy PRODUCED as well as stored, should be added to the revenue stream of Tesla. Elon said that the energy produced should be net positive. No way yet to quantify net energy produced without outlandish speculation.

Ok.

The Hawthorne Supercharger has a 5x20 solar canopy with 100 panels. If each panel is 100 w, then the installation is 10kW system. Might produce 8,000 kWh per year. If you can maximize time of use to charge the batteries at night, and discharge to grid during the day, then you could get a 4-10x amplification in buy price of $0.035/kWh to $0.20/kWh sell price.

CapitalistOppressor · May 30, 2013

Johan said:
Just don't forget that the main reason (I would presume) for the battery packs on the SC stations is not to charge them at night and then selling it back to the grid during the day, but instead to be able to charge more cars at peak hours without having a super-beefy grid connection and the associated demand fees.

You are forgetting that they will be used for battery swapping as well. "SuperCharging" facilities will be battery swap facilities with SuperCharger ports attached, and all covered over with solar collectors.

igotzzoom · May 30, 2013

If I were Tesla, I would proceed carefully with this. There's already the promise that Model S owners would be able to use Superchargers free for the life of the vehicle. The company needs to honor that promise. However, for subsequent future models, I don't think it would be that disingenuous to charge a small usage/Kw fee for owners. But make the proportional cost significantly cheaper than other public charging stations, which are running $1-2/hr, by providing a lot higher quantity of charge for the same cost. I could see an NFC smartphone app, possibly in conjunction with PayPal.

bollar · May 30, 2013

igotzzoom said:
If I were Tesla, I would proceed carefully with this. There's already the promise that Model S owners would be able to use Superchargers free for the life of the vehicle. The company needs to honor that promise. However, for subsequent future models, I don't think it would be that disingenuous to charge a small usage/Kw fee for owners. But make the proportional cost significantly cheaper than other public charging stations, which are running $1-2/hr, by providing a lot higher quantity of charge for the same cost. I could see an NFC smartphone app, possibly in conjunction with PayPal.

It's only free on the 85. It's a $2000 option on the 60. I think they have plenty of room to charge future owners on this, or another model.

igotzzoom · May 30, 2013

bollar said:
It's only free on the 85. It's a $2000 option on the 60. I think they have plenty of room to charge future owners on this, or another model.

Are you talking about the Supercharger option, or the use of the Superchargers? My impression is that if your vehicle is equipped with the Supercharger hardware, the use of the charging stations is free.

dsm363 · May 30, 2013

igotzzoom said:
Are you talking about the Supercharger option, or the use of the Superchargers? My impression is that if your vehicle is equipped with the Supercharger hardware, the use of the charging stations is free.

Both the 60 and 85 kWh cars have the hardware but you need to pay $6,000 to activate it on the 60 kWh Model S.

bollar · May 30, 2013

igotzzoom said:
Are you talking about the Supercharger option, or the use of the Superchargers? My impression is that if your vehicle is equipped with the Supercharger hardware, the use of the charging stations is free.

All Model S cars are Supercharger capable. The $2K enables access. It is apparently a software switch.

mitch672 · May 30, 2013

Please read the link I posted in post #7 of this thread, there will never be a need to charge for use of the SuperChargers, that is built into the one-time fee paid by the manufacturer to license their usage (in the case of Tesla themselves $1500 of the price of the 85KW Model S is reserved for that, for the 60KW Model S, that is an optional $2000 paid for by the end user)

Superchargers Potentially a Revenue Source

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