Published on March 5th, 2013 | by Guest Contributor


How Tesla’s Master Plan Is Similar To Germany’s Solar FiT

March 5th, 2013 by  

Reposted from Lenz Blog (image added):

By Karl-Friedrich Lenz

Tesla's Elon Musk Challenges New York TimesThis blog post at the Tesla Motors site is from 2006, but it was at the top spot in the “Energy” section of yesterday, so I found it that way.

In it, Tesla co-founder Elon Musk describes his “secret master plan” to get electrical cars on the street in big numbers. He observes that there are still some issues with price, which needs to get down, especially in 2006 (just like solar at the time).

To do that, his “master plan” does not rely on a feed-in tariff, but on the fact that rich people driving expensive cars don’t care much about cost. If anything, having the car become more expensive will increase sales for some people, who will appreciate the exclusiveness.

Building cars for the high end market first will give Tesla the opportunity to fund research, development, and price savings from mass production, with the ultimate goal of moving into middle and lower price market segments. From the blog post:

When someone buys the Tesla Roadster sports car, they are actually helping pay for development of the low cost family car.

Now note that once this strategy is successful, the chance to “helping pay for development” is gone. Early buyers of the expensive sports cars will have an unique and exclusive opportunity to help making the World a better place.

In exactly the same way, the opportunity to pay 50 cents Euro for solar photovoltaic is gone forever. Prices are already down close to fossil fuel in good solar locations, even if one doesn’t count the external carbon cost.

There is nothing wrong with Germany having paid a large chunk of that cost. On the contrary, I think Germany had a moral obligation to do more about global warming than other countries, since Germans have profited early and profited much from burning fossil fuel. I kind of like the fact that my country has contributed early, and contributed much to getting solar prices down.

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  • ThomasGerke

    Kick starting the solar technology revolution / creating an uncapped massmarket for solar technology that allowed scaling up production, was a long overdue and neccessary course of action.I am proud and happy that this historic endevour came about due to German democracy and massive up front investments by citizens, companies & farmers.

    As a result, the people of the world now have a mighty weapon in the fight against energy poverty. It is already starting to improve the lives of those billions of people who suffer due to the lack of access to modern technology.

    I would only wish, that our media & politicans would honour our important role in all this more openly and proudly.
    They are focused on silly bickering, fueled by the dying fossil fuel industry, that is holding us back and wants to increase the climage change debt we leave to our children & grand children.

    Isn’t improving the world forever at a time of crisis, worth spending 0,35% of GDP for 20 years?

    • anderlan

      It’s not simply a sacrifice for the rest of the world, it’s a wise *investment* for the home country. Politicians on both sides of the Atlantic should more openly acknowledge this. Maybe those who know the language of business and would spell it out this way are all gagged by the fossil fuel industry or fooled by their own investments in it. If so, I hope that changes, quickly.

  • anderlan

    Ah, such noblesse oblige from the author! This is why I hate Fox News and other pundit media with such unbridled loathing.

    They have taken my people’s magnanimity and replaced it with simple self-righteous anger. They tell them, “you have already been too noble, you are now being shat upon, throw your nobility out the window! There is no room for any gracefulness from you!”

    I hate, hate, hate, hate, hate Fox News, Drudge, Limbaugh, Hannity, and the thousands of local radio idiots spouting unproductive mind-destroying slovenliness.

    • But wait that doesn’t sound noble either. How about “Dislike their lying cheating hearts with extreme …”

      • anderlan


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