Readers of Seeking Alpha have lots of opinions about what Tesla (NASDAQ:TSLA) is, where it is going and what it might become. More than a few (short) investors have their fortunes riding on a cataclysmic fall in the complex edifice that is Tesla today.
Everyone has an opinion, with analysts from UBS saying that it is time to get rid of distractions and focus on a successful launch of the Model 3, while Elon Musk spends energy on breathing life into Tesla's stationary energy storage business.
To be clear, Elon Musk is quite capable of walking and chewing gum, and the recent $1.15 billion capital raise has assuaged some worries about free air in the lead up to the Model 3 launch. It is starting to look like the launch of the Model 3 might be in reasonably good shape.
Is there room for yet another major initiative by Tesla this year? Whether there is room or not, the Solar City team within Tesla say it is time to get their Solar Roof project out to market, so that is happening, with a July launch scheduled.
The Solar Roof to transform one aspect of the solar PV market?
At a time when there is significant angst about a world oversupply of solar PV capacity, new ways of incorporating solar power into buildings, especially roofs, is beginning to become a reality. Tesla has a substantial development with its about-to-be-released Solar Roof, which while not new, is a survivor of technology innovation. Dow had a similar solar shingle program, Powerhouse Solar Systems 2.0, that it abandoned last year after trying to establish a market for several years.
There is a long history of failed attempts to commercialize this technology. Australian steel maker BlueScope Steel (OTCPK:BLSFY) is exploring a variant, BIPV-T (Building Integrated PhotoVoltaic-Thermal) technology, which integrates steel roof panels with thin-film PV panels and uses a sealed chamber between them for capturing thermal energy in addition to generating electricity.
So what is changing in the rooftop solar area? Time leads to better technology, but to get a new technology adopted needs more. Perhaps the crucial ingredient might be the drive of two substantial energy entrepreneurs competing with each other.
A significant player in the development of the solar industry, Zhengrong Shi, is returning to the fray with a new company and a competitive technology. He will be keen to prove that he is still a force to be reckoned with after the bankruptcy of Suntech Power, the company he founded. Both Elon Musk and Zhengrong Shi have track records of innovation and commercialization, so it is interesting to see them going head to head in the rooftop solar area.
SunMan eArche: Source RenewEconomy
Dr. Zhengrong Shi was China's first solar billionaire, whose company Suntech Power went bankrupt in 2013. He is returning to the solar industry with a new company "SunMan" and new product, eArche, an ultralight, thin, flexible solar panel that is 80% lighter than conventional solar PV panels. Shi sees the product as ideal for incorporating into rooftops and building facades, especially where conventional panels are too heavy to be incorporated.
It can be cut and shaped as desired. The first market for the eArche product is new buildings and extensions. He is hoping that new government regulations will soon require solar panels to be incorporated into new buildings, providing a captive market for these kinds of products.
The Shanghai company will officially launch the eArche product in Sydney later this week. The initial focus is on building supply companies, especially those specializing in lightweight materials. He thinks the panels will be attractive to architects as they are lightweight and easy to work with. He contrasts the convenient features of the eArche product with Tesla's Solar Roof (see below), which he considers to be heavy and rigid. Tesla has acknowledged that there are significant engineering issues in building a roof as a seamless solar panel.
Not given to modesty, Dr. Shi claims the eArche to be the biggest innovation in the solar industry for more than a decade. Dr. Shi considers that there has been little product innovation but that most cost reductions have come from improved manufacturing, increased efficiency and supply chain management.
His recent focus has been on product innovation to get the panels lighter and less rigid. His new panels will have similar manufacturing costs but be cheaper to install. He claims 1MW of panels will fit in a 40ft container, with big savings on transport costs. There have been some materials challenges to match the silicon with his composite material to avoid cracking.
SunMan will initially focus on developing its market in Australia and Japan. There have been limited trials in installations in Sydney and Adelaide.
Tesla's Solar Roof program
Source : Tesla
Tesla's "Solar Roof" developments in the housing market, involves Panasonic and the Gigafactory.
This development involves roofing that look like normal roof shingles except that they are more durable. If Tesla is successful this could herald the end of rooftop solar panels as we know them. The release is due July 17, although that may be a moving target as this is yet another major Tesla event in a very busy diary. What will it cost? It seems that the cost will be equivalent to a conventional roof cost plus the cost of electricity saved by production from the roof.
There are no actual numbers yet, and of course, the costs of roofing vary significantly, so it is anyone's guess at the moment. The tiles are a high-end roofing solution. Elon Musk showed Tuscan Glass Tiles, Slate Glass Tiles, Textured Glass Tiles and Smooth Glass Tiles at a recent launch. The Solar Roof needs a Tesla Powerwall 2 battery system to capture the energy generated.
The market is interesting with 5 million new roofs in the just the US every year.
It is certain that, if successful, the Tesla Solar Roof will have an impact on the Tesla bottom line. How big an impact is anyone's guess at this stage. And the chance of success is also anyone's guess.
Tesla seems to be seeking to get its product to market through the conventional roofing industry, while SunMan is focused on lightweight building materials companies and architects to help drive its market penetration with attractive material that is versatile.
The upcoming launch of the Tesla "Solar Roof" (for houses and other buildings) is interesting because it comes not long after Dow Chemical (and many others) gave up, and at much the same time as a solar industry pioneer (Zhengrong Shi) launches his new ultralight version of a solar roof.
With two aggressive entrepreneurs converging on the rooftop solar space, this could get interesting. It may be the kind of attention needed to open the market up at a time when Governments are looking for ways to reduce carbon emissions and stimulate renewable energy production.
For Dr. Shi, his new SunMan company is his chance to get back in the game and it will have all of his attention. On the other hand, Tesla's Solar Roof program is going to be competing for air with a lot of action in the company in 2017. Like so much about Tesla at the moment, how much the Solar Roof program is going to contribute to Tesla's bottom line is impossible to determine, but for the optimists, it provides more reason not to be contemptuous about Tesla's current share price.
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