Elon’s secret plan for power revealed
Tesla founder Elon Musk has set his sights on a new market as his company's share price continues to fall, and his latest plan has just been revealed.
A little-known Tesla subsidiary is building a big battery to help sure up the reliability of the Texas state energy grid following a power outage crisis.
Mr Musk previously embarked on a similar endeavour in South Australia, with a giant Tesla battery being installed for energy storage near a wind farm in 2017.
The Hornsdale Power Reserve claim the 100MW big battery saved South Australians more than $A150 million in its first two years of operating, and its currently being expanded with an additional 50MW of storage.
On Monday, Bloomberg reported the Tesla subsidiary Gambit Energy Storage LLC is building a similarly sized battery south of Houston, Texas.
The company appears on a list of subsidiaries held by the US Securities and Exchange Commission and shares an address with a Tesla facility near its Fremont, California factory.
Gambit is one of many subsidiaries on the long list of companies under the Tesla umbrella, and like many others is incorporated in "tax-friendly" jurisdictions such as Delaware and the Cayman Islands.
Millions were left without power for days during the blackouts in Texas last month, which also embarrassed Texas Senator and one time Republican Presidential candidate Ted Cruz after he was spotted leaving the freezing state for sunny Cancun, Mexico.
As he's wont to do, Mr Musk took to Twitter at the time to poke fun at the situation, saying the Electric Reliability Council of Texas (ERCOT) was "not earning that R".
Texas is something of an anomaly in the United States power grid.
Unlike the rest of the states (and even some parts of Texas), it's independent from the federal government.
ERCOT was formed in 1970, following another major blackout in 1965.
It's now supposed to assist power reliability for a state that has more people than Australia.
According to Bloomberg, the Gambit project is registered with ERCOT and will sit alongside an electrical substation near the Texas border with New Mexico.
It's expected to start operating in June.
Energy is an important focus for Tesla, Mr Musk told shareholders during an earnings call last July that "Tesla Energy will be roughly the same size as Tesla Automotive" in the future, for one simple reason.
"The energy business is collectively bigger than the automotive business," Mr Musk said.
Tesla batteries have been used for power storage in California for years, but like Mr Musk reportedly plans to do himself, the battery storage options are now moving to Texas.
Tesla shares continued their downward trend on Monday, closing down 5.8 per cent at $US563 ($A734), down more than $US300 ($A391) since this time last month.
A month ago that same shareholding would have eclipsed $204 billion ($A266 billion) in value.
No one would be happy to lose a billion dollars of their net worth, but in a coincidence that would likely titillate Mr Musk, he loses around that amount when the Tesla price drops by $US4.20 ($A5.5).
He's already set to save around $US9 billion ($A11.7 billion) by not having to pay taxes if he moves to Texas.
Originally published as Elon's secret plan for power revealed