Even Tesla’s energy storage business was a small, yet remarkable, bright place, so it’s hard to escape the clouds hanging from the company.
Statistics released by Tesla show that the deployment of fixed storage products from Powerwall and Megapack has declined over the second quarter. In the second quarter of this year, the company installed 9.6 gigawatt-hour storage from the first quarter to 0.8 gigawatt-hour.
Tesla’s energy storage division peaked in the fourth quarter of 2024. This was developed for a three-month period of 11 gigawatt hours. Overall, Tesla launched its 31.4 GWH energy storage products in 2024.
Until this year, the sector has been a bright spot for Tesla, recording consistent growth year-over-year. Revenue from energy storage and solar power rose from $2 billion in 2020 to $10.1 billion last year. Tesla’s poor start to the year suggests that the streak is nearing its end.
In contrast, the broader market for energy storage has been growing recently. Analysts at Wood Mackenzie said record-breaking installations for the first quarter, the most recent period in which data is available, increased 57% year-on-year.
However, tariffs on Chinese-made goods are consistent with the fraudulent impact of the Trump-backed settlement bill, which is currently hashed in Congress, so such growth is unlikely to continue. That’s why Republicans have worked to eliminate key parts of the Inflation Reduction Act.
Although battery storage installations may continue to receive tax credits based on your invoice, new restrictions on parts or materials procured from the Foreign Entities of Concern (FEOC) could make it nearly impossible to claim the remaining tax credits. Most of the minerals used in batteries are refined or processed in China.
