Tesla Inc.’s (NASDAQ:TSLA) Energy Storage And Solar Installation Businesses Performed Exceptionably in 2020
Tesla Inc. (NASDAQ:TSLA) has released its latest quarter earnings report in which results indicate that the energy storage and solar businesses are starting to pay off.
Energy storage and solar installation businesses growing
In the fourth quarter, the storage business performed exceptionally with YoY growth approaching 200%. In a presentation to shareholders, Tesla indicated there were significant energy deployments in 2020 compared to 2019. The company said that its total battery deployments exceeded 32 GWh for the first time in a single year which is around an 85% YoY increase.
Equally, solar deployments performed exceptionally in 2020 with installations increasing 18% YoY to 205 MW. The company said the growth is due to meaningful improvements in its solar retrofit strategy that includes cost reduction, industry-leading pricing, and product simplification. Most importantly Tesla realized $752 million in Q4 from the storage and energy generation business. This was an improvement from $436 million reported a year ago and from $579 million realized in Q3 2020.
Interestingly, this could be the start of the Surge from Tesla’s energy business. Elon Musk had long indicated that he wants to create a leading power or utilities enterprise and world capital is organizing resources to spur the shift into renewables. Most importantly, tesla will benefit significantly from the current administration’s renewable plans through their goal of boosting solar development and buildings. However, big infrastructure spend requires big batteries that can store renewable power as well as massive solar installations.
More funds supporting renewable energy infrastructure
Also as the federal government commits resources to renewables, there is equally private capital coming in for improved energy storage and solar installations. Over the past week, investors committed over $2 billion into companies lending money to homeowners for efficient energy upgrades and solar installations. Tesla stands a chance to benefit from these cash registers for its solar installation and energy businesses.
The investments aim at driving the adoption of renewable energy sources to reduce greenhouse gases emission and combat climate change. The lending programs available aim at incentivizing the shift to efficient energy appliances and renewable sources.