“I want a Tesla solar roof. I don’t care what it costs.” When we last visited Elon Musk and his proposed solar roof that was the sort of customer that seemed most likely for Tesla’s great-looking, electricity-generating roofs composed of tempered glass tiles infused with photovoltaic cells.
Now that Tesla is officially taking orders (with a $1,000 deposit) the company has released a solar price calculator for anyone contemplating a new solar roof.
Two of the four styles will be available in June, gray smooth glass and black textured glass.
Slate glass and Tuscan glass are scheduled for a 2018 appearance. Now that consumers can crunch their own numbers, has the pool of potential customers for the Tesla solar roof deepened?
The Solar Roof Calculator
To use the Tesla solar roof calculator all you really need is your address (don’t worry – a Tesla roof salesman will not come knocking on your door). The calculator then factors in such variables as the size of your house, the climate in your area, the public utility information for your municipality, a 30 percent Solar Investment Tax Credit and so to arrive at an upfront cost of your new solar roof and the amount of energy savings your solar roof will realize over the life of the roof.
Tesla’s sample home assumed a 3,000-square-foot roof in the Mid-Atlantic region which would require one PowerWall battery used to store the energy generated by the glass tiles.
Cost of Tesla Solar Roof
The cost for that roof would be $65,550 (before adding the cost of the battery at $7,000) or $21.85 per square foot. While that sounds pricey, when the cost of electricity is factored into the equation the Tesla solar roof would save the homeowner over $15,000 in the course of a 30-year life span for the roof. Those savings only escalate from there since a Tesla solar roof is guaranteed for “infinity, or the lifetime of your house, whichever comes first.”
This compares to $10,500 to $15,000 for a similar sized asphalt roof.
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Is a Solar Roof Now the Future for Everyone?
So, is the Tesla solar roof truly a “better product at a slightly better price,” as Musk asserts. To evaluate that claim you need to begin with your house and its location. The calculator will use these to recommend a ratio of power-generating solar tiles to non-solar tiles. The recommendation may be that your house is not a candidate for solar power at all.
The calculator also uses Tesla’s own energy-generating figures. In practice those numbers may be faulty or the power-generating capability of the glass tiles may not be as great in practice as they were on company test roofs. Real life data is not available.
Musk has acquired New York-based SolarCity to handle installation, which has been baked into the calculator’s final price. But the company has not undertaken such a widespread installation endeavor before and conditions in the field often require special installation remedies. This could add thousands to the price of a solar roof.
The energy requirements of your house will also influence your energy-producing home configuration. Some houses may require more than one PowerWall (at $7,000 a pop). The tiles are guaranteed forever, but the warranty on power generation is 30 years so electrical components may have to be replaced out-of-pocket at some future time. And what happens if the wildly innovative and adventurous Tesla company is not around to honor that warranty in 30 years? Or fifteen? Or five?
Speaking of variables that no number cruncher without a time travel machine can calculate, tax credits that are available today may not be there in a future when solar power is the norm. Electricity rates are assumed in the algorithm to rise by 2% every year. What happens if a new technology comes along and utility rates actually fall in the future? Some power companies offer solar power-generating homes the chance to send excess energy back into the grid for money and that policy may not always be around.
Insurers are also not completely on board with solar roofs. Underwriters tend to prefer products with proven track records and home owners insurance rates may go higher to get in line with the unknown risk of a glass-tiled roof, if they are insurable at all.
If the Tesla solar roof is pitched as a three-decade investment then the consumer must also factor in the opportunity cost of locking that up-front cash in a roof when it could be freed for alternative investments. A $65,000 bond invested for 30 years at 5% interest would return $280,926.25. The savings on utility bills from a solar roof are not going to match that.
Since we started this evaluation with your house, let’s end there as well. Are you planning to be in the house for 30 years when the money scales of a new Tesla solar roof will begin to tip in your favor? If you sell before then, how much extra will your house fetch because of its solar roof?
They Are Glass Tiles, Not Crystal Balls
Now that the cost of a new Tesla solar roof is available (sort of), it does not appear as if the target market for the product has shifted. Certainly, if your roof is in good shape now it does not make financial sense to rip it our and install a Tesla solar roof. For new builds the cost of a Tesla roof may be rolled into a mortgage which could make it a viable option.
For most, however, the cost of a Tesla solar roof must be calculated as a future value investment chock full of knowns and known unknowns playing out over three decades. And as the pillar of economic theory in the 20th century, John Maynard Keynes, once said, “In the long run we are all dead.”
In the short run buyers of the Tesla solar roof will likely be the same: first movers who have no interest in future value. They want the latest, most fantastic-looking roof on their house now and won’t blink at the cost, whatever it is. Just send the bill! 😉
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