The Tesla Powerwall is one of the most popular energy storage systems for homes. You can install a Powerwall as a stand-alone battery or combined with solar panels, and both setups qualify for a federal tax credit equivalent to 30% of project costs.
The energy storage capacity of a Tesla Powerwall is 13.5 kilowatt-hours (kWh). If you add the battery to a solar panel system, you can store electricity during the day and use it at night. The Powerwall can also be used as a backup energy source during blackouts:
- Backup power is not possible with stand-alone solar panels, since their electricity output is always changing based on sunlight conditions.
- On the other hand, a charged battery can provide a sustained voltage and power output even when solar panels are not productive.
Here we will discuss the typical cost of a Tesla Powerwall, and the scenarios where it can boost the savings normally achieved by solar panels. We will also review the technical specifications and features of the Powerwall battery, along with the warranty offered by Tesla.
How Much Does a Tesla Powerwall Cost?
The price of a Tesla Powerwall varies depending on how you purchase the unit, and there are three main options:
|Powerwall Direct||$8,700 (1 unit) $16,200 (2 units) $23,700 (3 units)||You order the Powerwall directly from the Tesla website and the unit is delivered to your home. There is a delivery fee of $200. The price does not include installation costs and permitting. You must look for a Tesla-certified installer near you, and costs vary by location. According to EnergySage, you can expect to pay around $4,000 for the installation.|
|Purchasing a Powerwall along with a solar roof or solar panels from Tesla||$11,500||If you purchase a Tesla solar roof or solar panel system, you can get a Powerwall for an additional $11,500. This is the typical price calculated by the Tesla website, but it can vary depending on your location. The price includes installation services, which means you don’t need to look for a local installer.|
|Purchasing a Powerwall from a local Tesla dealer (not directly from Tesla)||EnergySage reports a typical price of $14,600 – $16,850.||The EnergySage price range includes installation services, and the exact cost varies by provider and location.|
As you can see in the table above, the price of a Tesla Powerwall depends on how you purchase the unit.
- Generally, ordering a Powerwall directly from Tesla is cheaper than purchasing one from authorized resellers.
- However, direct purchases generally have a longer delivery time, since the Powerwall has become so popular in the US.
- If you’re willing to pay a higher price for a quick delivery, you may find local Tesla dealers who have Powerwalls on stock.
Does the Tesla Powerwall Get the 30% Federal Tax Credit?
Thanks to the Inflation Reduction Act (IRA), the federal tax credit is available for all home battery systems with at least 3 kWh of capacity. Having a usable storage capacity of 13.5 kWh, the Tesla Powerwall is eligible for this benefit.
For example, if you purchase a Powerwall from a local Tesla provider for $15,000, you get a federal tax credit of $4,500. You can claim the tax credit regardless of how the Powerwall gets its charge:
- From solar panels or another renewable energy system.
- From the local power grid.
- From a combination of both sources.
Before the Act, only batteries that were fully charged with onsite solar energy were eligible for the tax credit. In other words, batteries using even a small percentage of grid power did not qualify. The Act removed this limitation in January 2023, and all residential batteries larger than 3 kWh are now eligible regardless of their charging method. The minimum battery size is increased to 5 kWh in commercial applications.
If you combine a Tesla Powerwall with solar panels or a solar roof, they also qualify for the Investment Tax Credit. Solar panel systems are fully covered, but the federal tax credit only applies for photovoltaic components in the case of solar roofs. In other words, the tax credit does not cover roofing materials that are not involved in power generation.
Local Incentives for Tesla Powerwall Battery Systems
Depending on where your home is located, a Tesla Powerwall may qualify for additional benefits beyond the federal tax credit. The following are some of the largest incentive programs for home batteries in the US:
- California Self-Generation Incentive Program (SGIP): $150 – $200 per kWh of storage capacity, according to the program dashboard.
- New York Retail Energy Storage Incentive: $250 per kWh of capacity, currently available only in Long Island.
- Vermont Bring Your Own Device (BYOD) Program: Green Mountain Power customers can get a rebate of up to $10,500 for grid-connected home batteries.
- Solar Massachusetts Renewable Target (SMART): Massachusetts homeowners who install a combined solar and battery system get a bonus incentive per kWh generated.
These are some of the largest energy storage incentives in the US, but you can find more programs depending on your location and energy company. Also keep in mind that local incentive programs are constantly changing. The incentive rates above apply for June 2023, but a qualified solar battery installer can give you the latest information.
How Much Can I Save with a Tesla Powerwall?
The power bill savings offered by a Tesla Powerwall can vary widely depending on local tariffs and regulations. There are two main scenarios where a home battery can increase the savings normally achieved by a solar panel system:
1) When you are charged “Time-of-Use” or TOU tariffs
Some electric companies charge you a variable kWh price throughout the day. Grid electricity is cheaper when overall demand is low, and more expensive when demand is high. Residential consumers are generally charged the highest TOU tariffs around the evening, when their energy usage reaches the highest point.
- If you own a Tesla Powerwall and a solar PV system, you can store electricity during the day and use it during peak-tariff hours.
- This way you achieve maximum savings per kWh generated.
As a quick example, assume your electric company has an off-peak tariff of 15 cents/kWh and a peak tariff of 35 cents/kWh. If you store 13.5 kWh of solar energy in a Powerwall during off-peak hours, and wait until the peak-tariff hours, you save an extra 20 cents/kWh. This can potentially increase the savings of your solar power system by $2.70/day, and $985.50/year.
2) When you don’t have access to net metering or solar buyback
In most states, you can sell excess energy from your solar panels to local electric companies, and you get a power bill credit based on energy exports during the billing period. This concept is called net metering or net energy metering, and the term “solar buyback” is used to describe net metering programs that target photovoltaic systems.
When net metering is available, a Tesla Powerwall does not offer additional savings: the credit for sending excess energy to the grid is equal to the savings achieved when storing that energy in a battery. However, net metering at retail prices is not available everywhere:
- Some electric companies buy excess energy at a price much lower than the tariff they charge, which means you get higher savings by storing that energy in a battery.
- There are also some US regions where there is no form of net metering or net billing, and all surplus energy sent to the grid is lost.
California recently introduced Net Energy Metering 3.0 (NEM 3.0) in April 2023, which drastically reduced the credits earned for excess solar energy. As a result of NEM 3.0, a home battery such as the Tesla Powerwall will actually shorten the payback period of solar panels.
Can a Tesla Powerwall Power an Entire Home During Blackouts?
According to the US Energy Information Administration (EIA), the average US home consumes 10,632 kWh per year, equivalent to around 29.1 kWh per day. With a 13.5-kWh capacity, a fully charged Powerwall can cover around 46% of the typical daily consumption of a US home.
A single Tesla Powerwall can keep most home appliances running during a blackout. However, you will probably need 2-3 units if you want to power a central air conditioner or other high-consumption devices reliably.
Tesla Powerwall: Technical Specifications and Main Features
Tesla has been upgrading the Powerwall since the first version of the product was launched in 2015. The Powerwall is very popular in the US, but this is justified by excellent features. The following table summarizes the technical specifications of the Tesla Powerwall+, which is the latest version of this home battery:
|Tesla Powerwall+ Specifications|
|Energy storage capacity||13.5 kWh Up to 135 kWh if you combine 10 Powerwalls|
|Continuous power output, on-grid||5.8 kVA without solar generation 7.6 kVA with solar panels under full sunshine|
|Continuous power output, off-grid||7 kW without solar generation 9.6 kW with solar panels under full sunshine|
|Peak power output, off-grid||10 kW without solar generation 22 kW with solar panels under full sunshine|
|Chemistry||Lithium nickel manganese cobalt oxide (NMC)|
|Size||62.8 x 29.7 x 6.3 inch|
|Operating Temperature||-4°F to 122°F|
Tesla also sells the Powerwall 2, which has similar specifications. The main difference is that the Powerwall+ has a built-in inverter, which is not included with the Powerwall 2.
- The Powerwall 2 does not have separate power ratings for stand-alone operation and combined solar plus battery operation.
- The battery has a 5.8 kVA on-grid power rating, and a 10 kW backup power rating.
Since the Powerwall 2 does not include an inverter, the unit is also smaller (45.3 x 29.6 x 5.75 inch) and lighter (251.3 lb). However, you need to purchase an inverter anyway.
The Tesla Powerwall is an AC-coupled battery. This means the unit uses its own inverter, which is independent from the solar inverter used by the photovoltaic panels. Thanks to this feature, you can easily add a Powerwall to an existing solar energy system, even if the existing inverter is not compatible.
Operating Modes of the Tesla Powerwall
The Tesla Powerwall is a smart device with several operating modes, which are described in the table below:
|Tesla Powerwall Modes||Description|
|Backup Reserve||The Powerwall provides backup power during grid outages. You can specify the percentage of charge that will be set aside for blackouts.|
|Self-Powered Mode||The Powerwall stores excess solar energy during the day, to be used at night.|
|Time-Based Control||The Powerwall is programmed to charge and discharge according to time-of-use tariffs, maximizing your power bill savings.|
|Energy Export Mode||The Powerwall sends energy to the grid at times of high demand, so you can claim power bill credits. Keep in mind that not all power companies allow this.|
|Grid Charging Mode||The Powerwall recharges from the grid when solar generation is not enough. Not all power companies allow this.|
|Self-Consumption Only||This mode is designed for home solar systems that have not been approved for grid connection yet. The Powerwall limits grid exports until you get Permission to Operate (PTO).|
|Preconditioning||Home batteries suffer a performance loss when temperatures are very low, but the Powerwall heats itself up to prevent this effect.|
|Advanced Settings||You can control energy export from your solar panel system. If permission to export is set to “NO”, the Powerwall absorbs all the energy generated by solar panels. Once the unit is fully charged, solar generation is reduced to match home consumption. If the permission to export is set to “YES”, the battery does not adjust its charging to limit solar energy export.|
You can read more about the Powerwall operating modes at Tesla’s official website.
Does the Tesla Powerwall Have a Good Warranty?
The Tesla Powerwall has a 10-year warranty that includes the following benefits:
- Replacements and repairs due to factory defects are covered at no cost.
- The Powerwall offers 70% of initial capacity at the end of the warranty period.
- You also get a 4-year workmanship warranty, which covers the installation service.
Many battery manufacturers specify a maximum number of cycles or energy throughput that is covered by the warranty. The Tesla Powerwall has no cycle limit or throughput limit when using only the following modes: solar self-consumption, time-based control and backup.
- Under these applications, Tesla guarantees 70% battery capacity after 10 years without an operating limit.
- In other applications, the warranty is limited by maximum throughput of 37,800 kWh. This is equivalent to 2,800 full cycles at the rated Powerwall capacity of 13.5 kWh.
Getting a professional installation is very important. The Powerwall warranty only applies if the unit is installed and serviced by a Tesla-certified installer. You will lose the warranty if the battery is handled by unauthorized technicians, used outside of the rated temperature range, or installed close to a water source.
In case you sell your home, the Tesla Powerwall warranty can be transferred to the buyer. However, the new user must show proof of ownership.