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Tesla's 'Dangerously Ambitious' Gigafactory Could Save U.S. Battery Business

84 points by cryptoz 13y ago

analyst74 13y ago
Interesting fact presented in the beginning of the article: all the government funded research/companies went belly up. Food for thought: Is it because of the sheer difficulty of such ventures? Or is it because the money went to the wrong hands?
- cobrausn 13y ago
  Well, the article answers the question later on. Cosmin Laslau, Lux’s energy storage specialist, said there are profound differences between the past failures and Tesla’s new lithium-ion production effort. “Most importantly, the likes of A123 built Li-ion capacity first, and then waited forlornly for demand and partnerships that never came,” he said. “Tesla has taken the opposite approach: It started by creating the demand, unearthing a niche for luxury EVs powered by massive battery packs.”
  - skywhopper 13y ago
    This makes sense. Domestic Li-ion manufacturing would be nice, but you won't generate more demand for batteries just by building new factories. What we need to spending money like those federal grants is on battery research. Capacity and charge time are major limiting factors on the growth of electric vehicles (not to mention the primary limiting factors in mobile computing performance as well). Finding new battery tech and improving existing tech is where the federal money should be flowing.
- DaniFong 13y ago
  I'm a founder of an energy storage company, Lightsail Energy. To say all government funded energy storage companies went belly up is an exaggeration. Many still survive, although you will note a strange anti-correlation between government funding and survival. In my opinion a lot of money did go in the wrong hands. The main problem is that the government is totally confused as to its actual funding strategy -- you need significant, continuous supplies of capital to develop and commercialize hard technology -- every time it fluctuates you impose major stresses and delays. In at least a few cases, the problem was that the government provided support, and thereafter withdrew it. This was most problematic for the DOE Government Loan Guarantee program -- after Solyndra (a major recipient) went belly up, the government called on their debt in a series of energy storage companies, particularly A123 and Beacon Power. That was the bankruptcy trigger. On the other hand, it is not exactly like those companies were doing so well anyway. They were fragile, though they might have had a bright future.
  - toomuchtodo 13y ago
    > This was most problematic for the DOE Government Loan Guarantee program -- after Solyndra (a major recipient) went belly up, the government called on their debt in a series of energy storage companies, particularly A123 and Beacon Power. That was the bankruptcy trigger. Is it possible Tesla paid their DOE loan back early to prevent any volatility from that liability hanging out there?
    - DaniFong 13y ago
      Hard to speculate, but it probably gave them a lot of leverage.
  - lotsofmangos 13y ago
    Hi, I've been following your company. You lot are amazing. That is all. :) edit - oh, I do have one thing to ask, how do you think your tech compares with Gravitypower http://www.gravitypower.net/ http://www.gravitypower.net/ and Isentropic http://www.isentropic.co.uk/ http://www.isentropic.co.uk/ ? edit 2 - and when can I expect to be able to buy a small one, say enough storage for my house? Or are you only doing the grid-scale?
    - DaniFong 13y ago
      Speaking as a engineer who generally applauds the competitive attempts but is sometimes freaked out by the technical challenges they put ahead of themselves... Gravity Power: I hope they have a good idea for how they can make and seal a giant concrete piston and boreshaft. I think engineered pumped hydro has a major edge on these guys -- and energy cache. Isentropic: potentially lower cost than us (gravel's not too expensive), but significantly more loss channels, so a tougher efficiency problem. Serious loss channel potential in the thermal gradient, plus both heat stores need to be pressurized in their main design. Wouldn't trade places with them, but maybe they'd say the same. We might eventually do a ~10kw version for homes or a ~100kw version for cars but that is very speculative / in the future. I am modestly excited by Ambri, Aquion, and Tesla.
  - Egregore 13y ago
- loceng 13y ago
  "Is it because of the sheer difficulty of such ventures?" Keeping R&D alive is difficult, especially in a competitive market. You need to keep momentum going. One way to help success rate is through economies of scale. If you know or have a hunch you can sell huge volumes, then you can more safely put money towards the infrastructure that will bring down cost per unit - whether that's for a full vehicle, or individual parts like batteries for a vehicle.
- baddox 13y ago
  I don't know the details of these government funded companies, but it doesn't seem to surprising. I wouldn't expect a government funded restaurant to be able to compete with privately funded restaurants either. It's pretty basic economics regarding how incentives work.
  - jjoonathan 13y ago
    Solyndra was beaten by government funded companies. Just not the US government.
- danmaz74 13y ago
  Food for thought: Tesla used government money too. Food for thought 2: Most tech startups go belly up.
thrill 13y ago
The statement at the end of the article that "[e]ven if the company fails to sell 500,000 vehicles a year, some of the gigafactory’s batteries could be used in the stationary storage market (which helps explain why he wants to build in the southwest, where solar and wind power farms can be incorporated.)" doesn't make sense to me as a reason even worth consideration, especially given in the same article is the statement that "it would exceed production of every other battery factory in the world – combined". The importance of location in the southwest US for the fledgling alternative energy market seems completely irrelevant if one is striving to become the worldwide majority supplier of a multi-billion dollar market. The access to the port of Galveston would certainly be valuable in shipping that product to the likely majority market offshore, but many other states with ports would likely be interested in a multi-thousand job plant.
- tlb 13y ago
  The value of a finished battery pack is about $20 / lb. Truck transport across the US costs about $0.35 / lb. So indeed, proximity to installation locations makes less than 2% difference.
  - toomuchtodo 13y ago
    Reno is ~235 miles from the Fremont factory, or about 4 hours. The gigaplant is going to be a critical part of Tesla's supply chain, and distance is critical. Better to have your main component within a short drive, and let cells/packs destined for others make the long slog via rail or ship.
gilgoomesh 13y ago
This $5 billion battery factory is intended to enable production of half a million EV cars per year by 2020. It's more amazing to me to think of the scale required in the mid 2020's when EV cars could be 10's of millions per year.
just2n 13y ago
What kind of draw can you put on these batteries? An 85kWh battery may be more useful in every garage than this article claims. The added expense is claimed to "keep consumers away", but really it means things like solar panels become more useful. If you are able to charge your car via power you generate and it can supply enough power back to run your home, you can get some huge benefits. You can have power at night that you generated during the day. No need to suck power from the grid. During outages, you would likely still have a few days of power. And finally, if we actually take full advantage of this, our power infrastructure could directly use these cars to distribute and store energy and route around outages, increasing stability in a huge way. All in all, this could usher in an era of crowd-sourced power generation. One of the primary reasons that hasn't been feasible was the ephemerality of power on the grid. You consume it just after it's produced. We have no good way to store it. But with hundreds of thousands of 85kWh capacity batteries plugged into the grid, we suddenly have a start. I think paying an extra $20,000+ for a car if that's a potential outcome is worth every penny.
- derekp7 13y ago
  So how would this work? During the daytime, you have your car with you at work, away from your solar panels at home. When your car is at home, it is night, so it is not charging then. During a power outage, are you really going to drain your source of transportation to power your house? Especially if you don't know when the power is coming back on to refresh your car batteries? I know I wouldn't -- I'd just fire up a gas generator when the power goes out for an extended time, and use that to also recharge the electric car.
  - epistasis 13y ago
    >During a power outage, are you really going to drain your source of transportation to power your house? It's important to look at the numbers here. An 85 kWH battery can drive 300 miles, or power the typical household for 3 days. Why wouldn't you power your house for a day if only meant 100 miles less range? How long are you expecting the power to be out? You may have a gas generator, but not everybody does. And if your car could act as a UPS until the generator kicked back in, why not?
shaunrussell 13y ago
"Dangerously Ambitious" really? Fuck their rhetoric.
- jotm 13y ago
  Lol, yeah, it's more like Smartly Ambitious...
- noir_lord 13y ago
  Compared to some of the other stuff he has done (privatised space launches) this is one is actually on the tame end of the spectrum.
jamdavswim 13y ago
Really forbes? One line on the second page..

84 points by cryptoz 13y ago

Interesting fact presented in the beginning of the article: all the government funded research/companies went belly up. Food for thought: Is it because of the sheer difficulty of such ventures? Or is it because the money went to the wrong hands?

cobrausn 13y ago
Well, the article answers the question later on. Cosmin Laslau, Lux’s energy storage specialist, said there are profound differences between the past failures and Tesla’s new lithium-ion production effort. “Most importantly, the likes of A123 built Li-ion capacity first, and then waited forlornly for demand and partnerships that never came,” he said. “Tesla has taken the opposite approach: It started by creating the demand, unearthing a niche for luxury EVs powered by massive battery packs.”
- skywhopper 13y ago
  This makes sense. Domestic Li-ion manufacturing would be nice, but you won't generate more demand for batteries just by building new factories. What we need to spending money like those federal grants is on battery research. Capacity and charge time are major limiting factors on the growth of electric vehicles (not to mention the primary limiting factors in mobile computing performance as well). Finding new battery tech and improving existing tech is where the federal money should be flowing.
DaniFong 13y ago
I'm a founder of an energy storage company, Lightsail Energy. To say all government funded energy storage companies went belly up is an exaggeration. Many still survive, although you will note a strange anti-correlation between government funding and survival. In my opinion a lot of money did go in the wrong hands. The main problem is that the government is totally confused as to its actual funding strategy -- you need significant, continuous supplies of capital to develop and commercialize hard technology -- every time it fluctuates you impose major stresses and delays. In at least a few cases, the problem was that the government provided support, and thereafter withdrew it. This was most problematic for the DOE Government Loan Guarantee program -- after Solyndra (a major recipient) went belly up, the government called on their debt in a series of energy storage companies, particularly A123 and Beacon Power. That was the bankruptcy trigger. On the other hand, it is not exactly like those companies were doing so well anyway. They were fragile, though they might have had a bright future.
- toomuchtodo 13y ago
  > This was most problematic for the DOE Government Loan Guarantee program -- after Solyndra (a major recipient) went belly up, the government called on their debt in a series of energy storage companies, particularly A123 and Beacon Power. That was the bankruptcy trigger. Is it possible Tesla paid their DOE loan back early to prevent any volatility from that liability hanging out there?
  - DaniFong 13y ago
    Hard to speculate, but it probably gave them a lot of leverage.
- lotsofmangos 13y ago
  Hi, I've been following your company. You lot are amazing. That is all. :) edit - oh, I do have one thing to ask, how do you think your tech compares with Gravitypower http://www.gravitypower.net/ http://www.gravitypower.net/ and Isentropic http://www.isentropic.co.uk/ http://www.isentropic.co.uk/ ? edit 2 - and when can I expect to be able to buy a small one, say enough storage for my house? Or are you only doing the grid-scale?
  - DaniFong 13y ago
    Speaking as a engineer who generally applauds the competitive attempts but is sometimes freaked out by the technical challenges they put ahead of themselves... Gravity Power: I hope they have a good idea for how they can make and seal a giant concrete piston and boreshaft. I think engineered pumped hydro has a major edge on these guys -- and energy cache. Isentropic: potentially lower cost than us (gravel's not too expensive), but significantly more loss channels, so a tougher efficiency problem. Serious loss channel potential in the thermal gradient, plus both heat stores need to be pressurized in their main design. Wouldn't trade places with them, but maybe they'd say the same. We might eventually do a ~10kw version for homes or a ~100kw version for cars but that is very speculative / in the future. I am modestly excited by Ambri, Aquion, and Tesla.
- Egregore 13y ago
loceng 13y ago
"Is it because of the sheer difficulty of such ventures?" Keeping R&D alive is difficult, especially in a competitive market. You need to keep momentum going. One way to help success rate is through economies of scale. If you know or have a hunch you can sell huge volumes, then you can more safely put money towards the infrastructure that will bring down cost per unit - whether that's for a full vehicle, or individual parts like batteries for a vehicle.
baddox 13y ago
I don't know the details of these government funded companies, but it doesn't seem to surprising. I wouldn't expect a government funded restaurant to be able to compete with privately funded restaurants either. It's pretty basic economics regarding how incentives work.
- jjoonathan 13y ago
  Solyndra was beaten by government funded companies. Just not the US government.
danmaz74 13y ago
Food for thought: Tesla used government money too. Food for thought 2: Most tech startups go belly up.

thrill 13y ago

The statement at the end of the article that "[e]ven if the company fails to sell 500,000 vehicles a year, some of the gigafactory’s batteries could be used in the stationary storage market (which helps explain why he wants to build in the southwest, where solar and wind power farms can be incorporated.)" doesn't make sense to me as a reason even worth consideration, especially given in the same article is the statement that "it would exceed production of every other battery factory in the world – combined". The importance of location in the southwest US for the fledgling alternative energy market seems completely irrelevant if one is striving to become the worldwide majority supplier of a multi-billion dollar market. The access to the port of Galveston would certainly be valuable in shipping that product to the likely majority market offshore, but many other states with ports would likely be interested in a multi-thousand job plant.

tlb 13y ago
The value of a finished battery pack is about $20 / lb. Truck transport across the US costs about $0.35 / lb. So indeed, proximity to installation locations makes less than 2% difference.
- toomuchtodo 13y ago
  Reno is ~235 miles from the Fremont factory, or about 4 hours. The gigaplant is going to be a critical part of Tesla's supply chain, and distance is critical. Better to have your main component within a short drive, and let cells/packs destined for others make the long slog via rail or ship.

gilgoomesh 13y ago

This $5 billion battery factory is intended to enable production of half a million EV cars per year by 2020. It's more amazing to me to think of the scale required in the mid 2020's when EV cars could be 10's of millions per year.

just2n 13y ago

What kind of draw can you put on these batteries? An 85kWh battery may be more useful in every garage than this article claims. The added expense is claimed to "keep consumers away", but really it means things like solar panels become more useful. If you are able to charge your car via power you generate and it can supply enough power back to run your home, you can get some huge benefits. You can have power at night that you generated during the day. No need to suck power from the grid. During outages, you would likely still have a few days of power. And finally, if we actually take full advantage of this, our power infrastructure could directly use these cars to distribute and store energy and route around outages, increasing stability in a huge way. All in all, this could usher in an era of crowd-sourced power generation. One of the primary reasons that hasn't been feasible was the ephemerality of power on the grid. You consume it just after it's produced. We have no good way to store it. But with hundreds of thousands of 85kWh capacity batteries plugged into the grid, we suddenly have a start. I think paying an extra $20,000+ for a car if that's a potential outcome is worth every penny.

derekp7 13y ago
So how would this work? During the daytime, you have your car with you at work, away from your solar panels at home. When your car is at home, it is night, so it is not charging then. During a power outage, are you really going to drain your source of transportation to power your house? Especially if you don't know when the power is coming back on to refresh your car batteries? I know I wouldn't -- I'd just fire up a gas generator when the power goes out for an extended time, and use that to also recharge the electric car.
- epistasis 13y ago
  >During a power outage, are you really going to drain your source of transportation to power your house? It's important to look at the numbers here. An 85 kWH battery can drive 300 miles, or power the typical household for 3 days. Why wouldn't you power your house for a day if only meant 100 miles less range? How long are you expecting the power to be out? You may have a gas generator, but not everybody does. And if your car could act as a UPS until the generator kicked back in, why not?

shaunrussell 13y ago

"Dangerously Ambitious" really? Fuck their rhetoric.

jotm 13y ago
Lol, yeah, it's more like Smartly Ambitious...
noir_lord 13y ago
Compared to some of the other stuff he has done (privatised space launches) this is one is actually on the tame end of the spectrum.

jamdavswim 13y ago

Really forbes? One line on the second page..