Tesla's so-called Gigafactory could lead to cheaper solar energy storage solutions

In a letter to investors about Tesla Motors’ 2013 financial results, Tesla Chairman and CEO Elon Musk says the company plans to build a gigawatt-scale factory for the production of lithium-ion batteries. The electric vehicle (EVs) manufacturer’s so-called Gigafactory would allow the company to achieve a major reduction in the cost of the battery packs used in its EVs and would accelerate the pace of battery innovation, says Musk. Moreover, he says: »Working in partnership with our suppliers, we plan to integrate precursor material, cell, module and pack production into one facility. With this
facility, we feel highly confident of being able to create a compelling and affordable electric car in approximately three years. This will also allow us to address the solar power industry’s need for a massive volume of stationary battery packs.«
Musk is also the chairman of US solar leasing company SolarCity Corp., so the battery factory would have a wider market than just EV batteries. In December 2013, SolarCity introduced a new energy storage system based on a battery technology provided by Tesla. The system includes learning software that’s able to automatically discharge the stored energy. According to the company, the storage system is designed for businesses that want to avoid the high-demand charges imposed by some utilities, which have recently started basing their electricity prices on peak demand and not on the amount of the electricity consumed.

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