Energy Plan Launched by Tesla in the UK, Short Shorts Update
Everybody Rob our here and today we are primarily talking about Tesla Energy Tesla has officially launched its energy service in the United Kingdom, and with that they've shared a lot of interesting details on their plans in that market. We then also have an update on delivery for Tesla's latest product or add. So starting off with Tessa Energy, tussle today, updated their website in the UK you can actually access this from I believe any country as long as you just go to the drop down and ginger location. So in the UK on Tesla's homepage there now, featuring a new product quote, the Tesla Energy plan designed for homes with solar and Power Wall. And Quote Tesla also has a nice little two minute video. They're sort of running through the entire process end to end. But basically what this energy plan does is utilized tussle power walls to create a virtual power plant in which Tesla will utilize their audit or software to manage energy storage levels in different distributed energy storage products such as the power wall. This adds value in a number of different ways, but I think the simplest way to understand it is to think of it as somewhat balancing the grid out Tesla can purchase energy when it's really cheap store it in the distributed network of power walls and then resell it when energy prices. Are High that's all managed in real time automatically by auditor software that helps balance out the grid and then tested profit from the differences in though selling prices. This is, of course, in addition to the normal benefits of having a power wall, which would be to store your renewable energy so that you can use that energy when your power production is not that high, and then of course, having backup energy in case of power outage, what that virtual power plant functionality enables is for tussle to partner with an energy retailer in this case, octopus energy in the UK to provide tuskers that have a power wall with a much cheaper energy plan. Than, they could get anywhere else tussle on the website says it can be up to seventy five percent cheaper for energy than any other available rate. So we're going to go into the details on that but I there are a couple of unique things we have to understand about the UK energy market, the first of which being the terminology. So in the UK essentially, each energy plan is known as a tariff I think generally, we think of tariff as being attacks, and here for the UK energy market, it does involve pricing, but it's broader than that. Basically, an energy tariff here is equivalent to saying an energy plan. So the tariff involves pricing. It involves whether you're power costs are fixed or variable your provider, the energy source that you're using whether that's renewable, -able or something else all of those details fit under what would be described as your energy tariff. So if we focus in on pricing, there are a couple of different charges. The first is what's known as a standing charge that is a daily fee they are paying basically for actively and UK power dot co dot UK says that the average staining charge for electricity in the UK is twenty point, five, eight pence per day twenty, point five pence is equivalent to twenty seven US sense. So that doesn't sound like a lot. But over the course of the year, that adds up to one hundred dollars on average. So that's the standing charge and there is a unit rate. So you're paying per kilowatt hour. Think we're operating used to that and on average that is fourteen point four pence per kilowatt hour sources vary on this, but it looks like the average home in the UK uses about four thousand kilowatt hours per year, which would lead to you `electricity costs five, hundred, seventy, six pounds per year. That's about seven hundred, fifty US dollars. So all in standing charge plus the actual payment for the electricity you're at about eight, hundred, fifty dollars per year and probably higher. If you have to charge electric vehicle. So with that context, let's look back at tussles energy plan and affect you. It says, what are the tariff details? Tesla says quote no standing charge on your bill, a twenty four, seven import rates of eight pence per kilowatt hour for current Tesla vehicle owners and eleven pence per kilowatt hour for non Tesla vehicle owners the lowest flat rate tariff available on the market as of October twenty twenty. So at eight pence per kilowatt hour and no standing charge over the course of the year at four thousand kilowatt hours you're looking at three hundred, twenty pounds or about four, hundred seventeen, which will, of course round. Up to four, hundred, twenty US dollars. So under that example, you're saving more than fifty percent more than four hundred dollars per year or about thirty five dollars a month remember though that's for the average around four thousand kilowatt hours. If you have an electric vehicle charging that, let's say that's double eight thousand kilowatt hours that should get you ten thousand fifteen thousand miles per year from your electric vehicle. Then your annual electricity costs go up to a little over twelve hundred pounds or about sixteen hundred US dollars under Tesla's energy plan that same amount of energy would cost about six hundred and forty pounds or about eight, hundred and thirty, five. US. Saving about seven hundred and sixty five dollars per year or sixty, five dollars per month so that all sounds great. The energy on this plan is all renewable but where the rub comes in as you have to actually by the power wall and in the UK that cost eight thousand pounds, that's a bit over ten thousand dollars. So if you're saving sixty five dollars per month while the payback period on that is about thirteen years. So on the surface, this looks pretty attractive and if you happen to already have power while. In the UK it seems like a no brainer. But unless I'm missing something on the math here, this is a complicated subject to me. It's not clear that this is something that everyone is immediately going to be scrambling to adopt where things get a little bit trickier to understand her on the math on is when we switched over from purchasing electricity actually selling electricity. So in the UK, there are a couple tariffs on that. There's a generation tariff and an export tariff.