A few days ago, the Texas Public Utility Commission (PUC) said that it was creating a memo to address issues that Commissioner McAdams touched upon in the July 11 workshop. To recap, Tesla Energy has been working with the PUC and the Electric Reliability Council of Texas (ERCOT).
The focus is on educating the utility and the commission about the benefits of allowing Tesla Powerwall customers in Texas to participate in virtual power plants (VPPs).
Tesla’s U.S. Energy Markets Policy Lead, Arushi Sharma Frank has been present at every meeting and has been working diligently to advocate for clean energy and Tesla Energy’s Texas customers.
The Memo
The previously mentioned future memo addresses some of the issues that Commissioner McAdams brought up in the July 11 workshop. He and Commissioner Glotfelty co-authored the memo.
The memo reads as follows:
As discussed during the June 16, 2022, Open Meeting and July 11, 2022, Aggregated Distributed Energy Resources (DER) Pilot Workshop, we support efforts to create a pilot project to test impacts of small-scale DER aggregation in the ERCOT market.
The pilot will answer questions related to how aggregated distributed generation can support reliability, enhance the wholesale market, incentivize investment, potentially reduce transmission and distribution investments, and support better load management during emergencies.
In the short term, we expect the pilot will bring in vital megawatts (MWs) of resources for participation in the ERCOT market.
ERCOT staff are required to prepare and present a governing document detailing the project scope to ERCOT’s board of directors.
The PUC will form a Task Force to identify operational obstacles to launching a pilot program and to assist ERCOT in drafting the governing document.
The next meeting to discuss the purpose and structure of the Task Force will be held on July 28, 2022. The governing document should be presented to the ERCOT board by October 11, 2022, so that it can meet a desired pilot start in the first quarter of 2023.
The Guiding Principles
The memo included five guiding principles that the commissioners want the pilot project to consider. They are:
- Understand the impact of having ancillary services carried on the distribution system.
- Create a structure that incentivizes competition and attracts broad DER participation through load-serving entities (LSEs).
- Measure the impacts of relieving or causing congestion on the distribution system, and study how to transition distribution-level aggregations to more granular dispatch and settlement.
- Ensure adequate customer protection is in place and information is anonymized.
- Start simple while ensuring economies of scale exist on a MW [megawatt] basis to attract broad participation. The pilot parameters should have the flexibility to progress to more complex scenarios as participation increases.
Project Scope.
This next section of the memo addresses the governing document that shares the project scope with ERCOT’s board of directors. These topics are scale, duration, transmission and distribution utilities participation, interchange of customers, and reliability.
The following is from the memo detailing each topic:
- Scale – Aggregations should be constrained within a load zone, with a single LSE, and served by the same transmission and distribution service provider (TDSP) with the potential for DER Management Systems (DERMS) aggregators to participate in the future. Participating TDSPs may limit pilot area based on feeder availability and information provided by LSEs related to their DER customers.
- Duration – The pilot should continue until implementation of ERCOT market rules to accommodate aggregation or until ERCOT deems the pilot project unnecessary. We expect a minimum of 3 years which will allow for incorporation of EMS upgrades, testing of customer migration, and qualifying resources for ERCOT services.
- TDSP Participation – It is imperative that competitive area transmission and distribution utilities (TDUs) and non-opt-in entities (NOIEs) participating in the pilot are willing participants and actively engaged to ensure safety and quality of experience to their customers. We expect reliability to be the ultimate consideration by TDSPs for qualifying DER customers.
- Interchange of Customers – The acquisition of customers should be handled by the LSE with terms and conditions to provide relevant operational data and a good customer experience that prioritizes affordability and reliability.
- Reliability – TDSPs should have the ability to manage participation considering system constraints, regular maintenance, and emergency situations. ERCOT in participation with the TDSPs shall be enabled to mitigate operational hazards and demands in this new era of transmission and distribution management.
You can read the full memo here. Have tips? You can email them to johnna@teslarati.com.
Elon Musk
Tesla’s $2.9 billion bet: Why Elon Musk is turning to China to build America’s solar future
Tesla looks to bring solar manufacturing to the US, with latest $2.9 billion bet to acquire Chinese solar equipment.
Tesla is reportedly in talks to purchase $2.9 billion worth of solar manufacturing equipment from a group of Chinese suppliers, including Suzhou Maxwell Technologies, which is the world’s largest producer of screen-printing equipment used in solar cell production. According to Reuters sources, the equipment is expected to be delivered before autumn and shipped to Texas, where Tesla plans to anchor its next phase of domestic solar production.
The move is a direct extension of a vision Elon Musk has been building for months. At the World Economic Forum in Davos this past January, Musk announced that both Tesla and SpaceX were independently working to establish 100 gigawatts of annual solar manufacturing capacity inside the United States. Days later, on Tesla’s Q4 2025 earnings call, he made the ambition concrete: “We’re going to work toward getting 100 GW a year of solar cell production, integrating across the entire supply chain from raw materials all the way to finished solar panels.”
Job postings on Tesla’s website reflect that same target, with language explicitly calling for 100 GW of “solar manufacturing from raw materials on American soil before the end of 2028.”
Tesla job listing for Staff Manufacturing Development Engineer, Solar Manufacturing
The urgency behind the latest solar manufacturing target is rooted in a set of rapidly emerging pressures related to AI and Tesla’s own energy business. U.S. power consumption hit its second consecutive record high in 2025 and is projected to climb further through 2026 and 2027, driven largely by the explosion in AI data centers and the broader electrification of transportation. Tesla’s own energy division, which produces the Megapack utility-scale battery storage system, has been growing rapidly, and solar supply is a critical companion component for the business to scale. Musk has argued that solar is not just a clean energy option but the only one that makes economic sense at the scale AI infrastructure demands.
Tesla lands in Texas for latest Megapack production facility
Ironically, the path to domestic solar independence currently runs through China. Sort of.
Despite Tesla’s stated push to localize its supply chain, mirrored recently by the company’s plan for a $4.3 billion LFP battery manufacturing partnership with LG Energy Solution in Michigan, Tesla still relies on China-based suppliers to keep its cost structure intact.
The $2.9 billion equipment deal underscores a tension Musk himself acknowledged at Davos: “Unfortunately, in the U.S. the tariff barriers for solar are extremely high and that makes the economics of deploying solar artificially high, because China makes almost all the solar.” Building the factory in America requires buying the machinery from the country Tesla is trying to reduce its dependence on.
Tesla named by U.S. Gov. in $4.3B battery deal for American-made cells
The regulatory pathway adds another layer of complexity. Suzhou Maxwell has been seeking export approval from China’s commerce ministry, and it remains unclear how quickly that clearance will come. Still, the market has already reacted, with shares in the Chinese firms reportedly involved in the talks surged more than 7% following the Reuters report that broke the story.
Whether Tesla can hit its 2028 target of 100GW of solar manufacturing remains an open question. Though that scale may seem staggering, especially in such a short timeframe, we know that Musk has a documented history of “always pulling it off” in the face of ambitious deadlines that may slip. But, rest assured – it’ll get done.
Elon Musk
Tesla named by U.S. Gov. in $4.3B battery deal for American-made cells
What began as an open secret in the energy industry was confirmed by the U.S. Department of the Interior on Monday: Tesla is the buyer behind LG Energy Solution’s blockbuster $4.3 billion battery supply agreement.
What began as an open secret in the energy industry is becoming more real after the U.S. Department of the Interior named Tesla as the stakeholder in the LG Energy Solution’s blockbuster $4.3 billion battery supply agreement.
Tesla and LG Energy Solution are expanding their partnership to build a LFP prismatic battery cell manufacturing facility in Lansing, Michigan, launching production in 2027. The announcement, made as part of the Indo-Pacific Energy Security Summit results, ends months of speculation.
“American-made cells will power Tesla’s Megapack 3 energy storage systems produced in Houston, creating a robust domestic battery supply chain.”, notes a press release on the U.S. Department of the Interior website.
Tesla has long utilized China’s Contemporary Amperex Technology Co. (CATL), the world’s largest LFP battery maker, as one of its primary suppliers. That relationship made financial sense for years, considering that Chinese LFP cells were cheap, abundant, and reliable. But with escalated tariffs on Chinese imports and an increasingly growing Tesla Energy business that’s particularly reliant on LFP cells for products including its Megapack battery storage units designed for utilities and large-scale commercial projects.
The announcement of a deepened partnership between LG Energy Solution and Tesla has strategic logic for both parties. For Tesla, it secures a tariff-compliant, domestically produced battery supply for its fast-growing energy division. LGES, now producing LFP batteries in Michigan, becomes the only major supplier currently scaling U.S. production, outpacing rivals like Samsung SDI and SK On. LG Energy Solution’s Lansing plant, formerly known as Ultium Cells 3, was previously operated as a joint venture with General Motors. LGES acquired GM’s stake in May 2025 and now fully owns the site, with a production capacity of 50 GWh per year. LG Energy said the contract includes options to extend the supply period by up to seven years and boost volumes based on further consultations.
For the broader industry, the ripple effects are significant. This deal signals that domestic battery manufacturing can be financially viable and not just aspirational. Utilities, energy developers, and rival automakers will take note as American-made LFP supply becomes a competitive reality rather than a distant promise.
For consumers, the benefits will take time but are real. A more resilient, U.S.-based supply chain means fewer price shocks from trade disputes, more stable Megapack availability for the grid storage projects that reduce electricity costs, and long-term downward pressure on energy storage prices as domestic production scales.
Deliveries are set to begin in 2027 and run through mid-2030, and as grid storage demand accelerates, reliable, US-made battery supply is no longer a future ambition. It is becoming a core requirement of the country’s energy strategy.
Energy
Tesla Energy gains UK license to sell electricity to homes and businesses
The license was granted to Tesla Energy Ventures Ltd. by UK energy regulator Ofgem after a seven-month review process.
Tesla Energy has received a license to supply electricity in the United Kingdom, opening the door for the company to serve homes and businesses in the country.
The license was granted to Tesla Energy Ventures Ltd. by UK energy regulator Ofgem after a seven-month review process.
According to Ofgem, the license took effect at 6 p.m. local time on Wednesday and applies to Great Britain.
The approval allows Tesla’s energy business to sell electricity directly to customers in the region, as noted in a Bloomberg News report.
Tesla has already expanded similar services in the United States. In Texas, the company offers electricity plans that allow Tesla owners to charge their vehicles at a lower cost while also feeding excess electricity back into the grid.
Tesla already has a sizable presence in the UK market. According to price comparison website U-switch, there are more than 250,000 Tesla electric vehicles in the country and thousands of Tesla home energy storage systems.
Ofgem also noted that Tesla Motors Ltd., a separate entity incorporated in England and Wales, received an electricity generation license in June 2020.
The new UK license arrives as Tesla continues expanding its global energy business.
Last year, Tesla Energy retained the top position in the global battery energy storage system (BESS) integrator market for the second consecutive year. According to Wood Mackenzie’s latest rankings, Tesla held about 15% of global market share in 2024.
The company also maintained a dominant position in North America, where it captured roughly 39% market share in the region.
At the same time, competition in the energy storage sector is increasing. Chinese companies such as Sungrow have been expanding their presence globally, particularly in Europe.
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