Tesla is facing blowback after numerous reports of delayed solar and energy storage installations.
The company was excoriated in a recent Business Insider story for failing to meet delivery timelines for the Solar Roof and Powerwall home battery product. Several current and former Tesla salespeople quoted in the article said that customers are facing long and uncertain wait times, while the company instructed some employees to avoid fielding Solar Roof inquiries due its limited availability.
Last week's USA Today article was a bit more sanguine, but still observed "slow production rates have meant too few Powerwalls are available for customers interested in the three-year-old product." Meanwhile, solar tiles for non-employee rooftops are just starting to get deployed two years after their introduction.
The article went on to say that the $6,000 Tesla Powerwall currently has a six- to nine-month wait time, and the Solar Roof has a delivery date of 2019 or beyond. Still, CTO JB Straubel insisted that Tesla is committed to solar and called the Powerwall a “big success,” particularly in Australia and Europe.
Despite the apparent delays, many homeowners are still willing to pay the $10,000 to $15,000 to add a Powerwall to an existing PV installation. Accessory devices, control systems, metering and software add cost to the battery system and make installation much more complex than for solar alone, according to Barry Cinnamon of Cinnamon Solar.
Buzz in the online forums
Experiences reported in online forums back up employee claims of Tesla delays.
Twitter user Seth Brody, who put a deposit down on a Tesla solar and Powerwall solution, said he recently received a call from the company saying all shipments and installs have been “halted indefinitely.”
The Tesla Motor Club page devoted to Powerwall 2 supply issues includes similar comments.
"The scheduling group informed me that due to supply chain issues, they will not be scheduling anyone until the end of the year,” said one commenter. “Unfortunately, if you haven't scheduled yet, it's looking like it won't happen until 2019."
Another community member said they were concerned delays would cause them to lose their reservation under the California Self-Generation Incentive Program. One user said Tesla has been unable to given even a rough estimate of when their systems will be delivered.
"Just got an email that they won’t even have a soft timeline due to an indefinite supply delay,” the customer wrote. “I guess my $500 will be an interest-free loan for a while, hopefully the 30 percent tax credit will still be around."
A GTM commenter gave an especially negative review of Tesla’s performance several months ago. “We are an installer [in] the business more than 15 years — we still can barely get any tangible info out of Tesla on PWII availability, much less answers to technical questions. And the ‘solar shingles’ may as well be vaporware, as far as our inquiries are concerned. I know many other installers across the U.S. that have similar experiences.”
“I'd say Samsung, Panasonic, sonnen, etc., are far more ‘in the game’ than Tesla is, at least as far as product availability in the real world goes,” the commenter continued.
A Tesla customer in Australia reported a very different experience, though, having received their Powerwall shortly after ordering.
"This astounds me! I'm in Australia. We ordered our PW2 in November 2017 and had it (along with a 10 kW solar system) fully installed and running in January 2018,” the Tesla Motor Club member wrote. It was “[a] timeframe of about 2.5 months from when we accepted the quote and paid our deposit."
In April, GTM spoke to one of the first Solar Roof customers, who said that interacting with Tesla was an overall “positive experience.”
Tesla's official line
Tesla responded to GTM regarding these press reports and user forum claims. A company spokesperson said that Powerwall deliveries continue globally for orders already placed, and that new orders placed this month will be delivered at the end of 2018 or the beginning of 2019.
Upon Powerwall production ramping at the Reno Gigafactory in 2019, the goal is for retail deliveries and installations to happen within one month. The company added that Solar Roof production is also ramping at Tesla’s Buffalo, New York factory.
As for PV, the company remains bullish on traditional solar for both commercial and residential rooftops and claims a four- to six-week span from sale to install. Tesla had a 16 percent market share for residential solar in 2017, way down from its 33 percent share in 2015, according to Wood Mackenzie Research.
The Powerwall timeline
There is still a disconnect between Tesla statements and reports from the field. Here's a Powerwall timeline that might root out some truth.
May 2015: Tesla unveils a new set of battery products at a hype fest in Southern California. The company announces it would charge $3,500 for a 10-kilowatt-hour energy storage pack that includes batteries, thermal management and software.
Aug. 2015: Tesla claims it is sold out of batteries through the end of 2015, representing up to $50 million for the year, and potentially 10 times that amount by the end of 2016, according to the CEO. Most of the battery orders have been for the 100-kilowatt-hour Powerpack units priced at $25,000 each, or $250 per kilowatt-hour — an unprecedented price, according to CEO Elon Musk.
March 2016: The 10-kilowatt-hour backup battery is discontinued. The smaller 6.4-kilowatt-hour battery designed for daily cycling applications remains, but there are few markets where energy arbitrage and self-consumption make economic sense. The wholesale price to installers is $3,000.
Nov. 2016: Tesla claims to have shipped more than 2,500 Powerwalls and nearly 100 Powerpacks in the quarter, according to a shareholder letter. The Powerwall went through a redesign, eliminating its poorly designed housing. The energy density inside the box doubled.
Nov. 2017: Tesla has a big battery backlog, possibly stemming from a production issue at the Gigafactory's battery module assembly line. Tesla uses Samsung cells in its Australian storage project instead of its captive Panasonic supply.
Feb. 2018: Tesla plans to triple the amount of energy storage it deploys in 2018 compared to 2017. Tesla's energy storage and solar group had 2017 revenue of $1.12 billion, a small piece of Tesla's total $11.7 billion in revenue last year.
April 2018: Tesla raises the price of the 7-kilowatt/13.5-kilowatt-hour storage system to $5,900 — a $400 increase, despite a year and a half of manufacturing experience and a continued plunge in battery prices.
April 2018: Vermont utility Green Mountain Power's on-bill payment offerings give customers access to batteries and other DERs, but to date, only a few hundred households are using the Powerwall offering.
How many Powerwalls has Tesla sold?
Tesla doesn't make it easy to divine the exact numbers of Powerwalls sold, which leaves it for GTM to read some tea leaves.
Green Mountain Power looks to install up to 2,000 Powerwalls. So far, according to the company, it has installed 530 units.
California's Self-Generation Incentive Program data offers a glimpse into Powerwall deliveries in the state. According to Brett Simon, senior storage analyst at Wood Mackenzie’s GTM Research, Tesla accounted for 82 percent of residential megawatt capacity that had reserved funding under the SGIP in 2017, but accounted for only 46 percent of reserved residential megawatts between January 2018 and May 2018. LG Chem had 53 percent.
This marks "the first time that Tesla has been unseated in residential reserved SGIP capacity," according to the analyst.
Simon pointed out that Tesla still accounted for the majority of megawatts actually installed under the residential SGIP through May 2018, but that's still a mere 500 kilowatts between January and May 2018 — which translates to roughly 100 units of the 5-kilowatt/13.5-kilowatt-hour Powerwall 2s.
Simon also noted that 2,622 grid-interactive residential energy storage systems were deployed in the U.S. in the first quarter of 2018 and 1,529 in the fourth quarter of 2017. It's a good bet that "Tesla had a decent share of them."
Tesla claims to have shipped more than 2,500 Powerwalls in the last quarter of 2016. The number of Powerwalls shipped to Puerto Rico, Australia and Europe is unknown.
The Tesla way
Silicon Valley icons Bill Hewlett and David Packard established "the HP way," a management style and corporate culture that, as best as I can tell, is a commonsense ethos of innovation, respect, consensus-building and employee empowerment. Elon Musk has created his own ethos.
The Tesla way, whether it's applied to Powerwalls or electric vehicles or short-sellers or rockets or cave rescues, appears to be more about moving fast and breaking stuff (including one's own systems) in order to achieve the greater goals of renewable energy dominance and electrification of transportation.
There's plenty of innovation in the Tesla way, but there's also a lot of hype, noise and distraction. There's a clear tendency to radically over-promise and under-deliver. And there's a cavalier attitude toward one's own customers, employees and stockholders. We've seen all of these qualities in the almost three-and-a-half years since Tesla introduced its storage line and the Powerwall.
The mission-centric Tesla way brought boring batteries into the hype cycle and the public consciousness, and inspired an enormous cohort of competitors and entrepreneurs to focus their lives on the energy storage industry. Now, Tesla needs to manufacture and deliver on the vision its CEO created.