

Energy
Tesla smart HVAC systems gain potential market with Australia’s ~AU$800M energy initiative in Victoria
Victoria’s comprehensive ~AU$800 million home energy package may lead to a potential market for Tesla’s HVAC system in Australia. Elon Musk has shown particular interest in Tesla developing an integrated home HVAC system, mentioning the product as far back as his initial appearance at the Joe Rogan Experience podcast in 2018. Victoria may have just made an investment that could provide a potential market for Tesla’s integrated HVAC system.
Recently, Energy minister Lily D’Ambrosio announced that the Andrews Ministry will invest approximately AU$797 million in a home energy savings package. The initiative means to encourage the shift to more smart energy efficient appliances and integrated home systems in households, rental properties, and businesses in Victoria.
Some parts of the initiative could make Victoria a good market for Tesla’s integrated HVAC system in the future. According to Renew Economy, the Ministry plans to invest AU$335 million to help low income earners replace old wood and electric or gas-fired heaters in their homes. The small renovation could save over 250,000 households AU$300 to AU$900 in their power bills. Another AU$112 million will be invested to seal windows/doors, as well as upgrade heating/cooling systems, and hot water systems in 35,000 social housing properties.
We will make super efficient home hvac with hepa filters one day
— Elon Musk (@elonmusk) September 11, 2020
In the Q2 earnings call, Tesla’s Senior VP of Powertrain and Energy Engineering and Technology Drew Baglino said the company learned to build a tightly integrated system thanks to the Model Y and Model 3 heat pump. He said that the system was capable of moving heat “anywhere really” and it was applicable to heating and cooling needs in a home.
Elon Musk elaborated on the subject. “Yes. Absolutely. I think like the heat—for heat pump in the car, being able to use the batteries both as a thermal and an electric energy reservoir is very significant. Same thing could be applied to a home with the water heater, and the back of pack itself, of course.
“So I think there’s potential for an integrated home system that kind of does power generation/storage, heating/cooling, air filtration, water purification in a really tight package. We don’t actually have like a prototype or anything, but I think conceptually, that is something that would be probably good to have,” he said.
2/3: Today’s announcement includes 42,000 rebates for rooftop solar over the next two years, plus 15,000 new rebates available for small businesses and 17,500 battery rebates will be available over the next three years.
— Clean Energy Council (@cleannrgcouncil) November 17, 2020
Other Opportunities for Tesla in Victoria
As Musk mentioned during the Q2 earnings call, Tesla doesn’t have a prototype of its potential integrated home HVAC system yet. So it may be a while before Tesla can take advantage of the market Victoria could offer for that particular product.
However, there are other ways Tesla could benefit from Victoria’s almost ~AU$800M home energy initiative.
Besides the millions on improving home integrated systems, the Victorian government’s investments could encourage more households and small businesses to install solar panels and use home batteries like Tesla’s Powerwall 2.
Part of the initiative includes investing $191 million to a Solar Homes Program over the next two years. It will offer 42,000 rebates to help over 140,000 households install solar panels on their roofs with no upfront costs. There will also be 15,000 rebates open to small businesses interested in installing solar panels.
Tesla’s solar panels might be a good fit for Victoria’s Solar Homes Program. The company’s Solar Roof V3 product has not been released in Australia yet, but it might be another good option for homeowners as well, if it is covered by the program’s rebates.
Tesla Energy is setting its sights on another market that’s ready for a battery storage disruption
Tesla’s Powerwall sales could also improve under Victoria’s energy initiative. The local government will be releasing 17,500 rebates to install home batteries over the next three years. Previously, home battery rebates were restricted to certain post codes, but the initiative seems to open up the rebates to all corners of Victoria.
With that in mind, Powerwalls could lead to pockets of virtual power plants in the state. Virtual power plants in Victoria would compliment Neoen and Tesla’s massive 300 MW/450MWh energy storage project in the state which will be operational by around Summer 2021-2022.
Energy
Tesla Energy is the world’s top global battery storage system provider again
Tesla Energy captured 15% of the battery storage segment’s global market share in 2024.

Tesla Energy held its top position in the global battery energy storage system (BESS) integrator market for the second consecutive year, capturing 15% of global market share in 2024, as per Wood Mackenzie’s latest rankings.
Tesla Energy’s lead, however, is shrinking, as Chinese competitors like Sungrow are steadily increasing their global footprint, particularly in European markets.
Tesla Energy dominates in North America, but its lead is narrowing globally
Tesla Energy retained its leadership in the North American market with a commanding 39% share in 2024. Sungrow, though still ranked second in the region, saw its share drop from 17% to 10%. Powin took third place, even if the company itself filed for bankruptcy earlier this year, as noted in a Solar Power World report.
On the global stage, Tesla Energy’s lead over Sungrow shrank from four points in 2023 to just one in 2024, indicating intensifying competition. Chinese firm CRRC came in third worldwide with an 8% share.
Wood Mackenzie ranked vendors based on MWh shipments with recognized revenue in 2024. According to analyst Kevin Shang, “Competition among established BESS integrators remains incredibly intense. Seven of the top 10 vendors last year struggled to expand their market share, remaining either unchanged or declining.”

Chinese integrators surge in Europe, falter in U.S.
China’s influence on the BESS market continues to grow, with seven of the global top 10 BESS integrators now headquartered in the country. Chinese companies saw a 67% year-over-year increase in European market share, and four of the top 10 BESS vendors in Europe are now based in China. In contrast, Chinese companies’ market share in North America dropped more than 30%, from 23% to 16% amid Tesla Energy’s momentum and the Trump administration’s policies.
Wood Mackenzie noted that success in the global BESS space will hinge on companies’ ability to adapt to divergent regulations and geopolitical headwinds. “The global BESS integrator landscape is becoming increasingly complex, with regional trade policies and geopolitical tensions reshaping competitive dynamics,” Shang noted, pointing to Tesla’s maintained lead and the rapid ascent of Chinese rivals as signs of a shifting industry balance.
“While Tesla maintains its global leadership, the rapid rise of Chinese integrators in Europe and their dominance in emerging markets like the Middle East signals a fundamental shift in the industry. Success will increasingly depend on companies’ ability to navigate diverse regulatory environments, adapt to local market requirements, and maintain competitive cost structures across multiple regions,” the analyst added.
Energy
Tesla inks multi-billion-dollar deal with LG Energy Solution to avoid tariff pressure
Tesla has reportedly secured a sizable partnership with LGES for LFP cells, and there’s an extra positive out of it.

Tesla has reportedly inked a multi-billion-dollar deal with LG Energy Solution in an effort to avoid tariff pressure and domesticate more of its supply chain.
Reuters is reporting that Tesla and LGES, a South Korean battery supplier of the automaker, signed a $4.3 billion deal for energy storage system batteries. The cells are going to be manufactured by LGES at its U.S. factory located in Michigan, the report indicates. The batteries will be the lithium iron phosphate, or LFP, chemistry.
Tesla delivers 384,000 vehicles in Q2 2025, deploys 9.6 GWh in energy storage
It is a move Tesla is making to avoid buying cells and parts from overseas as the Trump White House continues to use tariffs to prioritize domestic manufacturing.
LGES announced earlier today that it had signed a $4.3 billion contract to supply LFP cells over three years to a company, but it did not identify the customer, nor did the company state whether the batteries would be used in automotive or energy storage applications.
The deal is advantageous for both companies. Tesla is going to alleviate its reliance on battery cells that are built out of the country, so it’s going to be able to take some financial pressure off itself.
For LGES, the company has reported that it has experienced slowed demand for its cells in terms of automotive applications. It planned to offset this demand lag with more projects involving the cells in energy storage projects. This has been helped by the need for these systems at data centers used for AI.
During the Q1 Earnings Call, Tesla CFO Vaibhav Taneja confirmed that the company’s energy division had been impacted by the need to source cells from China-based suppliers. He went on to say that the company would work on “securing additional supply chain from non-China-based suppliers.”
It seems as if Tesla has managed to secure some of this needed domestic supply chain.
Energy
Tesla Shanghai Megafactory produces 1,000th Megapack for export to Europe
The Shanghai Megafactory was able to hit this milestone less than six months after it started producing the Megapack.

Tesla Energy has announced a fresh milestone for its newest Megapack factory. As per the electric vehicle maker, the Shanghai Megafactory has successfully produced its 1,000th Megapack battery.
The facility was able to hit this milestone less than six months after it started producing the grid-scale battery system.
New Tesla Megapack Milestone
As per Tesla Asia in a post on its official accounts on social media platform X, the 1,000th Megapack unit that was produced at the Shanghai Megafactory would be exported to Europe. As noted in a CNEV Post report, Tesla’s energy products are currently deployed in over 65 countries and regions globally. This allows Tesla Energy to compete in energy markets that are both emerging and mature.
To commemorate the 1,000th Megapack produced at the Shanghai Megafactory, the Tesla China team posted with the grid-scale battery with celebratory balloons that spelled “Megapack 1000.” The milestone was celebrated by Tesla enthusiasts on social media, especially since the Shanghai Megafactory only started its operations earlier this year.
Quick Megafactory Ramp
The Shanghai Megafactory, similar to Tesla’s other key facilities in China, was constructed quickly. The facility started its construction on May 23, 2024, and it was hailed as Tesla’s first entry storage project outside the United States. Less than a year later, on February 11, 2025, the Shanghai Megafactory officially started producing Megapack batteries. And by March 21, 2025, Tesla China noted that it had shipped the first batch of Megapack batteries from the Shanghai plant to foreign markets.
While the Shanghai Megafactory is still not at the same level of output as Tesla’s Lathrop Megafactory, which produces about 10,000 Megapacks per year, its ramp seems to be quite steady and quick. It would then not be surprising if Tesla China announces the Shanghai Megafactory’s 2,000th Megapack milestone in the coming months.
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