Over the course of this year, Tesla’s executives such as CEO Elon Musk and CTO JB Straubel have remarked that the company’s energy business is growing at a rapid rate. Recent reports from Buffalo, NY indicate that this growth will soon be evident in the operations of Tesla’s Gigafactory 2, particularly since the production ramp of the company’s flagship solar product — the Solar Roof tiles — is now going through its initial phases.
Tesla recently invited local news outlets on a guided tour of Gigafactory 2. The tour was the first time reporters were given access to the 1.2-million sq ft facility, and while the media were not allowed to film anything inside the factory itself, Tesla did provide a number of updates about Gigafactory 2 and the Solar Roof tiles. First off, Tesla noted that there are currently around 800 employees (comprised of Tesla and Panasonic workers) working on the site. This number is ahead of the facility’s targets, which require 500 workers to be employed on the site by April 2019. Gigafactory 2 is also running 24/7, with workers alternating 12-hour shifts.
The guided tour was led by director of operations Ryan Nungesser, who is in charge of Gigafactory 2. Nungesser, a former US marine platoon commander, was employed by the electric car and energy company after his tenure at Boston Scientific, where he worked several roles including Director of Production and Director of Materials Management. While Elon Musk himself has reportedly not visited the facility in person, the former marine and the CEO regularly keep in touch through weekly webcast meetings. Addressing the local media personnel on the tour, Nungesser remarked that the facility maintains a collaborative atmosphere, thanks to Tesla’s flat hierarchy.
Tesla reportedly had to work through notable bottlenecks in the development, testing, and production of the Solar Roof tiles, which are designed to be incredibly durable and last the lifetime of a house. Dan Miner, a reporter for Buffalo Business First, nevertheless noted that Tesla is confident that it currently has a “repeatable, efficient process” that would allow the company to begin the production of the Solar Roof tiles in greater volumes. Tesla declined to give details on the current output of the facility, though the company has stated that there is a long waiting list of Solar Roof customers that would likely keep the factory busy for years.
As the facility prepares to ramp the production of the Solar Roof tiles, Tesla managers in the facility are expecting the addition of new manufacturing lines. Another hiring ramp is also expected in the near future. Corey Leone, a facilities maintenance technician at Gigafactory 2 who previously worked at a coal-burning plant in Dunkirk, noted to Rochester First News that his experience over the past three years has been quite positive.
“To be able to come here and do green energy, to go from coal to this, it’s been an amazing journey. I’ve been here almost three years. It’s been a fantastic ride,” he said.
Tesla’s Solar Roof tiles are a pivotal part of the company’s plan to promote “sustainable energy independence.” While the cost of the Solar Roof tiles is far higher than conventional solar panels for now, Tesla noted in its Q2 2017 Update Letter that the shingles, which look like regular roofing materials but are capable of capturing power from the sun, would be far more affordable in the future.
“Adopting solar has historically required a degree of aesthetic compromise, but Solar Roof provides clean energy from a better-looking roof. Furthermore, Solar Roof is more affordable than conventional roofs because in most cases, it ultimately pays for itself by reducing or eliminating a home’s electricity bill,” Tesla noted.
As mentioned by Elon Musk during the third quarter earnings call, the production of the Solar Roof tiles is taking longer to ramp due to the shingles’ long development cycle. Musk did state, though, that the production of the Solar Roof tiles should hit its stride sometime next year.
“We’ll also start going into volume production of the solar tile roof next year. That’s quite a long development cycle for — because anything that’s roof has got to last 30 years. So even if you do accelerate life testing as fast as possible, there’s still a minimum amount of time required to do that. And there’s a lot of engineering that goes into how do you put on the solar tile roof with a — and not be really labor-intensive in doing so. So there’s a lot of engineering not just in the tile but in the way it’s done,” Musk said.
Energy
Tesla Lathrop Megafactory celebrates massive Megapack battery milestone
The Tesla Megapack is the backbone of Tesla Energy’s battery deployments.
The Tesla Lathrop Megafactory recently achieved a new milestone. As per the official Tesla Megapack account on X, the Lathrop Megafactory has produced its 15,000th Megapack 2 XL battery.
15,000 Megapack Batteries
Tesla celebrated the milestone with a photo of the Lathrop Megafactory team posing with a freshly produced Megapack battery. To commemorate the event, the team held balloons that spelled out “15,000” as they posed for the photo.
The Tesla Megapack is the backbone of Tesla Energy’s battery deployments. Designed for grid-scale applications, each Megapack offers 3.9 MWh of energy and 1.9 MW of power. The battery is extremely scalable, making it perfect for massive energy storage projects.
More Megafactories
The Lathrop Megafactory is Tesla’s first dedicated facility for its flagship battery storage system. It currently stands as the largest utility-scale battery factory in North America. The facility is capable of producing 10,000 Megapack batteries every year, equal to 40 GWh of clean energy storage.
Thanks to the success of the Megapack, Tesla has expanded its energy business by building and launching the Shanghai Megafactory, which is also expected to produce 40 GWh of energy storage per year. The ramp of the Shanghai Megafactory is quite impressive, with Tesla noting in its Q1 2025 Update Letter that the Shanghai Megafactory managed to produce over 100 Megapack batteries in the first quarter alone.
Tesla Energy’s Potential
During the first quarter earnings call, CEO Elon Musk stated that the Megapack is extremely valuable to the energy industry.
“The Megapack enables utility companies to output far more total energy than would otherwise be the case… This is a massive unlock on total energy output of any given grid over the course of a year. And utility companies are beginning to realize this and are buying in our Megapacks at scale,” Musk said.
Energy
Tesla Megapacks powers the xAI Colossus supercomputer
Tesla Megapacks step in to stabilize xAI’s Colossus supercomputer, replacing natural gas turbines. Musk’s ventures keep intertwining.
Tesla Megapack batteries will power the xAI Colossus supercomputer in Memphis to ensure power stability. The collaboration between Tesla and xAI highlights the synergy among Elon Musk’s ventures.
The artificial intelligence startup has integrated Tesla Megapacks to manage outages and demand surges, bolstering the facility’s reliability. The Greater Memphis Chamber announced that Colossus, recently connected to a new 150-megawatt electric substation, is completing its first construction phase. This transition addresses criticism from environmental justice groups over the initial use of natural gas turbines.
“The temporary natural gas turbines that were being used to power the Phase I GPUs prior to grid connection are now being demobilized and will be removed from the site over the next two months.
“About half of the operating turbines will remain operating to power Phase II GPUs of xAI until a second substation (#22) already in construction is completed and connected to the electric grid, which is planned for the Fall of 2025, at which time the remaining turbines will be relegated to a backup power role,” the Chamber stated.
xAI’s rapid development of Colossus reflects its ambition to advance AI capabilities, but the project has faced scrutiny for environmental impacts. The shift to Megapacks and grid power aims to mitigate these concerns while ensuring operational continuity.
The Megapack deployment underscores the collaboration among Musk’s companies, including Tesla, SpaceX, Neuralink, and The Boring Company. Tesla appears to be the common link between all of Musk’s companies. For example, The Boring Company built a tunnel in Giga, Texas. In addition, Musk has hinted at a potential collaboration between the Tesla Optimus Bot and Neuralink. And from January 2024 to February 2025, xAI invested $230 million in Megapacks, per a Tesla filing.
Tesla Energy reported a 156% year-over-year increase in Q1 2025, deploying 10.4 GWh of storage products, including Megapacks and Powerwalls. Tesla’s plans for a new Megapack factory in Waller County, Texas, which is expected to create 1,500 jobs in the area, further signal its commitment to scaling energy solutions.
As xAI leverages Tesla’s Megapacks to power Colossus, the integration showcases Musk’s interconnected business ecosystem. The supercomputer’s enhanced stability positions xAI to drive AI innovation, while Tesla’s energy solutions gain prominence, setting the stage for broader technological and economic impacts.
Energy
Tesla Energy celebrates one decade of sustainability
Tesla Energy has gone far since its early days, and it is now becoming a progressively bigger part of the company.
Tesla Energy recently celebrated its 10th anniversary with a dedicated video showcasing several of its milestones over the past decade.
Tesla Energy has gone far since its early days, and it is now becoming a progressively bigger part of the company.
Tesla Energy Early Days
When Elon Musk launched Tesla Energy in 2015, he noted that the business is a fundamental transformation of how the world works. To start, Tesla Energy offered the Powerwall, a 7 kWh/10 kWh home battery system, and the Powerpack, a grid-capable 100 kWh battery block that is designed for scalability. A few days after the products’ launch, Musk noted that Tesla had received 38,000 reservations for the Powerwall and 2,500 reservations for the Powerpack.
Tesla Energy’s beginnings would herald its quiet growth, with the company later announcing products like the Solar Roof tile, which is yet to be ramped, and the successor to the Powerwall, the 13.5 kWh Powerwall 2. In recent years, Tesla Energy also launched its Powerwall 3 home battery and the massive Megapack, a 3.9 MWh monster of a battery unit that has become the backbone for energy storage systems across the globe.
Key Milestones
As noted by Tesla Energy in its recent video, it has now established facilities that allow the company to manufacture 20,000 units of the Megapack every year, which should help grow the 23 GWh worth of Megapacks that have already been deployed globally.
The Powerwall remains a desirable home battery as well, with more than 850,000 units installed worldwide. These translate to 12 GWh of residential entry storage delivered to date. Just like the Megapack, Tesla is also ramping its production of the Powerwall, allowing the division to grow even more.
Tesla Energy’s Role
While Tesla Energy does not catch as much headlines as the company’s electric vehicle businesses, its contributions to the company’s bottom line have been growing. In the first quarter of 2025 alone, Tesla Energy deployed 10.4 GWh of energy storage products. Powerwall deployments also crossed 1 GWh in one quarter for the first time. As per Tesla in its Q1 2025 Update Letter, the gross margin for the Energy division has improved sequentially as well.
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