Tesla's Megapack Energy Storage Systems are in High Demand

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Written by Danny Levin, Deputy Editor for IIR News Intelligence (Sugar Land, Texas)

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Summary

Elon Musk says Tesla's Megapack battery energy-storage systems are nearly sold out through 2027.

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Demand for Tesla's Megapacks

During Tesla's recent third-quarter earnings conference call, chief executive officer Elon Musk said the company's Megapack battery-energy storage systems are nearly sold out through 2027.

"Energy demand is very strong," Musk said in the October 21 call. "We are actually almost sold out of all Megapacks for 2027, and we are ramping production as quickly as possible to meet demand. We also expect gross margins on that to increase meaningfully."

Industrial Info Resources data show more than $30 billion worth of active and planned projects that are using, or considering using, Tesla's Megapack battery-energy storage system (BESS) units.

Tesla's energy generation and storage business, its highest-margin hardware business line, recorded a 33.1% gross margin in the third quarter--an increase from 20.4% in the previous quarter. The company deployed 13.7 gigawatt-hours of energy storage, indicating its second-best quarterly performance.

Also in the call, Chief Financial Officer Vaibhav Taneja said the margin improvement is mainly due to tariff refunds and warranty adjustments.

Tesla recently began producing its Megapack 3 batteries at its facility in Brookshire, Texas.

Megapack 3 is the company's third-generation utility-scale system, which features lithium iron phosphate (LFP) battery cells. In order to support future assembly of Megapack 3s, Tesla earlier this year signed a deal with LG Energy Solution to source $4.3 billion worth of LFP cells. View the related project report here.

Projects Featuring Tesla's Megapacks

Projects underway featuring Megapacks include:

• Intersect Power's grassroot 1,150-megawatt (MW) BESS in California
• Georgia Power's 500-MW BESS addition at its Plant Bowen in Bartow County, Georgia
• OCI Company Limited's grassroot 120-MW BESS in Elmendorf, Texas, outside of San Antonio

Industrial Info Resources offers more information on these projects in its Global Market Intelligence (GMI) Power Plant and Project databases, where readers can find details--including construction schedules, investment values and necessary equipment--in reports for the California, Georgia and Texas projects.

Proposed developments include Georgia Power's 192.5-MW addition at its Hammond BESS facility in Rome, Georgia, and a new stand-alone, 200-MW facility from RWE in Park County, Colorado.

Readers can view a full list of active and planned Power Industry projects that are using, or considering using, Tesla's Megapack BESS units.

While much of the activity ($20 billion) is concentrated in the U.S., Canada and Australia (combined US$7.6 billion) also are home to active and planned Megapack installations. Stanwell Corporation Limited is building out its grassroot 300-MW BESS in Queensland, while Metlen Energy & Metals later this year expects to begin work on adding 100 MW of storage in Alberta, Canada. View the project reports here.

Key Takeaways

• Elon Musk says Tesla's Megapack battery energy-storage systems are nearly sold out through 2027.
• $30 billion: Total value of active and planned Power Industry projects using, or considering using, Megapacks.

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About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 trillion (USD).