Wonder what Tesla will do for power in Germany.

[brur]

Teslas' planned plant in Germany is going to need electricity. Germany has very expensive power costs and into the future, those costs look to grow. Solar plants and wind have not been especially fruitful in Germanies latitude.
I guess the decision was made, it is what it is. Between labor costs and power costs, there will be a squeeze, sort of a " can you find an opposite to China?" I would have thought an eastern-block or Portugal would have had traction. For different reasons of course.
Germany does have the cache, but still, seems counterintuitive.

 

[Tam]

...Between labor costs and power costs...

As long as the costs are predictable whether low or high, a business can be profitable.

If Tesla worries about the electric cost, it should move out of California to where the hydroelectric rate is almost free.

If Tesla worries about the labor cost, it should move out of California to where the labor is almost free in other countries.

There have been headlines on how doom and gloom Tesla has been and that's the same with green energy headlines in Germany.

However, in March 2019, Germany used 54.5 percent of electricity from renewable energy:

Germany generated more than 50 percent of electricity from renewables in March - Renewable Energy World

 

[brur]

Price | Energy Charts
interesting graph. Wind looks to be a player in the market. Solar doesn't make a dent. The chart is fairly interactive.

 

[2012MS85]

I worked over two decades for Buffett’s Iowa utility company, and ensuring low cost electricity prices was my top job. Iowa had a 16-year rate freeze (1995-2011), with rates ranging from 3 cents for industrial clients like Google (which signed up and built the world’s largest data center in Council Bluffs, across I29 from our 3GW of coal plants) to 8 cents per kWh for residential rates. Today almost half of Iowa’s electricity is coming from wind, but the rates have also surged to pay for the billions invested in MidAmerican Energy’s 6GW of new wind turbines. Going green is good, just not free.

I was on the team that did the due diligence when we bought PacifiCorp, which supplies all the cheap coal-fueled electricity (likely still under $0.10/kWh) for Tesla’s Gigafactory. I never understood Elon bragging about not running a natural gas line to GF, as I knew he was actually choosing lots of coal-fueled power instead. When GF was unveiled, all the pictures showed GF 100% covered in solar panels and surrounded by wind turbines. But it’s 2020 and GF still has few solar panels on the roof (that could be coming from GF2, on the cheap) and not a single wind turbine in sight.

GF3 will economically benefit from China’s cheap electricity, but 70% is coal-fueled (US is down to 25% and falling every year) with virtually no emissions controls for SOX, NOX, Hg, particulate matter, etc (vs US that has a strong EPA mandating all these emissions controls). So that’s disappointing.

Then the news of GF4 coming to Germany hit, and I was extremely surprised because Germany’s average electricity cost is among the highest in the world at ~$0.40/kWh (half of that is govt taxes, which could possibly be negotiated down?). Energy is one of the highest costs (up there with batteries) in producing a vehicle, so the cost of a Made in Germany 3 or Y will certainly be Tesla’s highest GF locations. On the upside, Tesla will save a few thousand in shipping costs to Europe. But I sure thought Elon would have chosen ANY European country other than Germany for GF4, given that it has the highest price for power.

 

[2012MS85]

Price | Energy Charts
interesting graph. Wind looks to be a player in the market. Solar doesn't make a dent. The chart is fairly interactive.

I like the link and info on Germany’s energy, but the real-time wholesale price of electricity has little correlation to what consumers pay. GF4, if lucky, will have already met with the utility, politicians, and regulators to hopefully cut a discounted deal for bringing in this new economic development and the careers that go with it. Otherwise, the price per kWh in Germany is about $0.40/ kWh (with govt taxes), and it will only increase from there.

 

[brur]

I like the link and info on Germany’s energy, but the real-time wholesale price of electricity has little correlation to what consumers pay. GF4, if lucky, will have already met with the utility, politicians, and regulators to hopefully cut a discounted deal for bringing in this new economic development and the careers that go with it. Otherwise, the price per kWh in Germany is about $0.40/ kWh (with govt taxes), and it will only increase from there.

I suspect you have nailed it.
Just as a thought, I wonder how much energy is used making and charging the batteries vrs the cars themselves.

 

[eisa01]

Industry doesn’t pay those rates. It will be closer to the wholesale price

 

[TechOps]

You guys aren't getting the symbology here.. This is Elon putting his factory right in the capitol of Germany, as a big middle finger to the entire world who said that German luxury automobiles were so superior to Tesla. It's not about electricity rates.

 

[Big Dog]

You guys aren't getting the symbology here.. This is Elon putting his factory right in the capitol of Germany, as a big middle finger to the entire world who said that German luxury automobiles were so superior to Tesla. It's not about electricity rates.

Agreed. Elon is showing that Tesla Euro comes with German manufacturing.

Yes, California is an absolutely terrible place to make/build stuff, but a free factory is a free factory.