RNE has a post on a Morgan Stanley report on tesla's potential to hasten the utility death spiral - How Tesla could pull more consumers off the grid.
Investment bank Morgan Stanley says the global electricity utility industry is still underestimating the potential of EV maker Tesla to achieve a dramatic reduction in battery storage costs, luring more and more consumers to go “off-grid.”
In a detailed report released in late July, Solar Power & Energy Storage, Morgan Stanley said that energy storage, specifically that being developed by Tesla in its so-called “giga-factory” could be disruptive in US and Europe, and elsewhere.
It does not mention Australia in the report, but Australia has all the ingredients of a market perfect for such disruption – excellent solar resources and high electricity costs, and more specifically, high network charges.
“Given the relatively high cost of the power grid, we think that customers in parts of the US and Europe may seek to avoid utility grid fees by going “off-grid” through a combination of solar power and energy storage,” Morgan Stanley’s leading energy analysts write in the report.
“We believe there is not sufficient appreciation of the magnitude of energy storage cost reduction that Tesla has already achieved, nor of the further cost reduction magnitude that Tesla might be able to achieve. once the company has constructed its “Gigafactory,” targeted for completion later in the decade.“
This, of course, has massive implication for the incumbent utilities, not to mention for other consumers. The immediate response for networks has been to seek to raise fixed charges to protect their revenue, an option that Morgan Stanley says will be counter-productive.