The newly announced Tesla Powerwall home battery is purely a luxury item. Surprised? That’s what Telsa does well: introduce a sexy object that only the wealthy will buy. So far it’s worked out well for them and a tiny fraction of the potential customers out there excited about electric cars. They are not Apple, yet. Apple sells affordable luxury. Tesla will get there when they make their money, so long as they don’t pour it all back into R&D for their next big thing or a “city on Mars”.

The real buyer of these 7kWh and 10kWh batteries will be Elon Musk’s other company, SolarCity who currently lease to own solar panels with no money down. Pairs well with an efficient battery that is comparably priced to the much bulkier and obsolete lead acid batteries.

It makes almost no sense to buy these to expect a significant savings of money and change nothing in the house – the same insulation, the same equipment and appliances. You can see that without some incentives for energy saving improvements this is purely becoming a status item. It would have to be seen as also an emergency backup after an outage. Easier to use and maintain than a generator. There is an extremely long payback for simply using off peak electricity – the big selling point for this device. My household’s total shared electric bill is $60 per month. Even if I theoretically save $20 per month, it would take 12.5 years to break even. By then the battery would be long retired.

Some utility companies don’t even have variable rates for residential customers and Washington state has the third lowest rate (6.9¢ per kWh retail before taxes) in the country – so long as the hydro plants keep churning.

If you’re a U.S. resident, check to see if your location makes more sense for this new thing. Certainly places that have expensive nuclear power plants to feed and pay off have higher rates:

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