In an August 31, 2016 S-4 filing Tesla (TSLA) reported that it planning to raise additional funds by the end of this year.
"Such additional funds would be used primarily for tooling, production equipment and construction of the Tesla's Model 3 production lines, equipment to support cell production at Tesla's Gigafactory, as well as new Tesla retail locations, service centers and Supercharger locations. Secondarily, if the Merger with SolarCity is completed, the additional funds would also be used to support the additional capital needs of the Combined Company."
A recent article estimates that Tesla needs to raise $5.53 billion if the SolarCity deal is approved and $2.47 billion if the deal is not approved.
Tesla noted on its website on September 15, 2016:
“Last week, through a competitive process, Tesla was selected to provide a 20 MW/80 MWh Powerpack system at the Southern California Edison Mira Loma substation. Tesla was the only bidder awarded a utility-owned storage project out of the solicitation.
Upon completion, this system will be the largest lithium ion battery storage project in the world. When fully charged, this system will hold enough energy to power more than 2,500 households for a day or charge 1,000 Tesla vehicles.”
The contract is a step toward the transformation of Tesla from an an electric car company to a clean-energy company, done in conjunction with the acquisition of SolarCity.
According to Tesla's website, a 1 MW / 4 MWh Tesla Powerpack system costs about $2 million.
Recycling can save money
Bloomberg New Energy Finance estimates that about 95 GWh of lithium-ion batteries are expected to come out of cars by 2025, and about 26 GWh of them will be converted to stationary systems.
"Today, a new stationary storage system can cost up to $1000/kWh. In contrast, repurposing used EV batteries could cost as little as $49/kWh in 2018, with an additional $400/kWh cost to convert to stationary."
If Tesla is serious about using EV batteries for utility storage it needs to establish a recycling program immediately. While very few Tesla owners have replaced batteries so far, BMW, Nissan and Mercedes Benz have second-life stationary storage projects in place. It will be many years before EV batteries have reached their end-of-life to power a car (there is still sufficient power left for stationary storage), so Tesla's current need for funds will not come from battery recycling. But it eventually will.
Tesla is cool to the notion of recycling batteries for stationary storage, perhaps planning to reuse some of the components for new batteries. However, I expect that Tesla will eventually move to a different lithium ion battery chemistry than the one it currently uses.
Three major materials used in batteries include:
• Lithium Nickel Cobalt Aluminum (Li1-xNiCoAlO2) used by Tesla and Panasonic on Model S, referred to as NCA
• Lithium Nickel Manganese Cobalt (Li1-x (NiMnCo)O2) used by nearly all Korean and Japanese manufacturers, referred to as NMC
• Lithium Iron Phosphate (Li1-xFePO4) being promoted by the Chinese government, referred to as LFP
I’ll discuss in a future article based on energy density, cost, and driving range, which battery structure will be used in future Tesla EVs.
