As usual, Elon Musk was extremely convincing in his most recent announcement about Tesla’s new Powerwall battery. Imagine: in a matter of months, you could be weaned off fossil fuels and start participating in the clean energy ecosystem of the future. Your home or business could be off the grid completely.

As solar energy is more widely adopted, a dedicated battery to store the energy makes a lot of sense. Without one, that excess power generated during peak sun hours is often sold back to utility companies, then purchased back when customers need it. That actually adds demand on power plants, increases carbon emissions, and overall, it’s not sensible or efficient. The utility providers can end up making money off of the power you generate.

So Tesla made the Powerwall, which works like most other renewable energy storage systems. You may recognize names like Alevo or Enphase Energy, if you’re familiar with the clean energy industry. This battery stores electricity from solar panels and helps balance loads from the grid. It charges during non-peak energy usage hours, when the rates are lower — like the middle of the day or middle of the night — then provides you energy during morning and evening demand, when rates are higher.

However, there is still no great economic return because the market hasn’t matured enough and installing a whole system of solar panels and massive batteries remains incredibly expensive, even though the Powerwall was announced at a much lower price point than the industry expected.

More on that in a minute. First, here’s a rundown of the key takeaways from the announcement:

1. Telsa’s plan is to remain agnostic: Tesla is seemingly willing to work with any company to install and utilize these batteries. That doesn’t lock them into anyone, so third party developers, installers, and software companies can access the storage systems at a much lower price, and it gives the company the ability to scale and work with providers around the world.

2. They’ll begin installing this summer: “I was surprised they said next year [they will be] scaling significantly,” said Brian Warshay, an analyst with Bloomberg New Energy Finance, noting that the Gigafactory will be complete in late 2016 or 2017. “So it sounded awfully optimistic.” The Gigafactory, which is the world’s largest battery factory, is being built with Panasonic, which will manufacture lithium-ion battery cells for Tesla car batteries. Customers can reserve a Powerwall on Tesla’s website, and installations — done by third party installers — will begin this summer.

3. Tesla Energy is a new division of the company: Tesla is officially no longer just an electric car company. Tesla will offer Powerpack, sold in 100-kilowatt-hour modules at $25,000 each. According to CNET, Tesla has already started working with industrial customers on these installations.

4. Low price point: The price for the residential battery is much lower than most experts anticipated — upwards of $10,000. Musk announced Powerwall at $3,500 for the 10 kilowatt hour (kWh) battery and $3,000 for the 7 kWh model. However, that’s not including the installation costs, or costs for an entire solar outfit on your home or business, which can rack up quickly. “The fact they openly announced pricing… will put pressure on competitors,” Warshay said.

Here’s how it works: The Powerwall comes in a 10 kWh weekly cycle — for backup applications — and 7 kWh for daily cycles. If a home/business has a greater energy need, multiple batteries can be stored — up to 90 kWh total for the 10 kWh battery and 63 kWh total for the 7 kWh battery. The Powerwall generates 2.0 kW continuous and 3.3 kW during peak usage. It weighs 220 pounds and can be installed indoors or outdoors. The battery technology is lithium ion.

Many companies offer lithium-ion battery solutions, though there are other types out there like compressed air energy storage or flow batteries, but those are still in the nascent stages of R&D. Tesla is also the first large company to plan to manufacture energy storage and it’s offering a 10 year warranty.

Musk’s enthusiasm would have you believe it’s incredibly easy and cheap to go off the grid. Soon, it will be much easier, and it continues to be more cost effective as the price of solar panels and installations plummet, with the help of SolarCity where Musk also serves as chairman. But as of right now, the ROI still takes too long to reach break-even for people to view it as an economic benefit.

Why? Basically, it boils down to how much you pay per kWh put into the battery, which is then retrieved later. And if you don’t already have a big enough photovoltaic system to get off the grid, paying the estimated $0.30/kWh for electricity through the Powerwall may not make much sense. On average, grid prices for electricity in the US are about $0.12/kWh. Rooftop solar PV is estimated to reach grid parity in most places by 2016, but it’s not quite there yet.

“It’s much more likely people have a PV system, a few kilowatt hours of storage here and there, and self supply 70-80%, but not 100%,” Warshay said. “As you get up closer, there are significant diminishing returns.”

The batteries are already big with early adopters — engineers, renewable energy professionals, and avid Tesla or Musk fans — but they’ll have to show a significant economic benefit to catch on in the mainstream. The utility scale batteries, on the other hand, show a lot of promise, as Tesla already has pilot programs and partnerships to deploy the systems, and it will probably be the cheapest option for commercial storage.

The way to do that is to create an ecosystem, so that renewable energy makes sense from all angles. Musk, as usual, already seems several steps ahead of everyone with this. According to Greentech Media, Peter Rive, CTO of SolarCity and Musk’s cousin, said that the solar company plans to offer shared grid revenue services by allowing SolarCity customers to use Tesla’s batteries as grid resources and make some money off of the revenue they share with other grid users. SolarCity will install Tesla’s batteries for $5,000 (which is on top of the $3,500 price tag for the battery itself).

Just days after the Powerwall announcement, Tesla announced it will sell used electric cars at lower prices, and there’s a four year (or 50,000 mile) warranty on pre-owned vehicles. Since the first-generation Model S is reaching its three year mark, people who leased the vehicle will be returning it soon, which means there will likely put more electric vehicles on the roads.

Bringing the attention back to the cars — and especially, to the move toward more affordable cars — was a smart move by Musk. He’s expanding the ecosystem for Tesla and for sustainability, and pushing back against the idea that renewables are too expensive to invest in. That’s the primary argument people have at this point, and it’s quickly fading — even if it’s not quite as rosy as the picture Musk painted in the Powerwall announcement.

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