Tesla dumbs down Powerwall 2 offering but it actually comes in two versions

Tesla Powerwall 2

Tesla CEO Elon Musk revealed in October that the second generation of its residential storage battery — the Powerwall 2 — would have double the energy density of the original product and cost $5,000 with a built-in inverter. That’s a significant upgrade over the original, which needed a separate external inverter and was priced at $7,000 not including the price of the separate inverter and installation costs. More energy storage and an inverter for less money?

Yes and no. Green Tech Media has learned the company is quietly offering two versions of the Powerwall 2, one with a built in AC inverter and one that requires a separate external DC inverter. Why the difference? It depends on how a customer intends to use the Powerwall 2.

Ravi Manghani, energy storage director at GTM Research, has the answer. “The AC one maximizes efficiency for self-consumption in real time or export to the grid,” he says. “The DC system maximizes efficiency for customers who are less likely to consume during the daytime when the solar is producing — customers who need time-shifting to evening hours.” Offering the Powerwall 2 with and without an inverter allows the installer to custom design the system to meet the needs of individual customers.

Why is Tesla not touting the two different products? Manghani thinks it may be to avoid confusing customers with too much technical information. Explaining the difference between AC and DC current and then adding in the different efficiency levels of DC versus AC inverters may be too much information for non-professionals to comprehend. Customers are interested in price, not arcane details about how electricity works.

“Tesla is trying to simplify the information that it’s providing to the end customers, whereas other companies will specifically say ‘This is an AC-coupled system or a DC-coupled system,'” Manghini sasys. “It’s probably an information overload in some cases.”

Tesla now suggests that customers should allow an additional $1,500 for “installation and supporting hardware,” bringing the total to $7,000. That is very close to the number Tesla quoted when the original version of the Powerwall was introduced. The difference is the second generation product has twice the capacity of the original.

One other advantage of the Powerwall 2 with built in inverter is that it will interface seamlessly with existing rooftop solar systems. There are already a million such systems in Australia, Germany, and the US that could benefit from having a Powerwall added to the mix.

Both versions are priced at $5,500 even though one comes with a built in inverter and one does not. External inverters usually cost around $2,000 or more. Bear in mind that the installed price of a Powerwall system will vary widely, depending on the complexity of installation in each individual home. Tesla is expected to begin delivering Powerwall 2 in early 2017.

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