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Tesla Applies For Permit To Sell Electricity in Texas

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Earlier this week, Tesla submitted an application with the Texas Public Utility Commission for a permit to sell electricity. Tesla Energy Ventures, a wholly-owned subsidiary of Tesla, applied so it can sell electricity directly to consumers in the Lone Star state. 

RELATED: Texas Power Problems Persist As Deep Freeze Continues

Tesla Energy Ventures Applying To Sell Electricity

Previously, Tesla built several utility-scale energy storage facilities all over the world. This includes systems in California and Australia. Despite its experience, Tesla has yet to function as a retail provider that will sell electricity.

Instead, Tesla helps provide power to other companies through its systems. In the Tesla Energy Ventures application, the signatory is Ana Stewart, director of regulatory credit trading. 

Currently, the company is building its latest energy storage facility in Angleton, Texas. Once completed, it aims to connect 100 megawatts from its storage system to the Texas electricity grid. If this happens, this becomes the company’s first foray into becoming a power utility provider. 

Texas’ February Freeze Led to Blackouts

A severe cold front descended on Texas earlier this year. This caused widespread blackouts and water shutoffs for large areas in the State. Many power plants lacked the winterization systems that enable them to operate in extreme cold. Meanwhile, water pipes froze and cut off water in residential homes. 

While some officials squarely blamed green energy for the lack of energy, reports later showed that fossil fuel energy plants were to blame.

It turned out that the Public Utilities Commission and the Texas Railroad Commission, which regulates the oil and gas industry, spent years ignoring the need to fix or update vulnerabilities in the Texas power system. In addition, many experts have already called for weatherizing outdoor facilities. 


Texas Grid Remains Independent From The Federal Grid

The Texas electricity remains isolated from the rest of the mainland US electricity grid. This is the major reason why some states not affected by the cold snap couldn’t provide excess power to help Texas.

Instead of connecting to the national lines, Texas has the Electric Reliability Council of Texas (ERCOT) to manage the flow of electricity for the entire state.

With Texas deregulating the utility industries, power costs soared due to demand during the deep freeze. During the time, Tesla CEO Elon Musk gave a mild rebuke to ERCOT, tweeting that the agency isn’t earning that R in their acronym. 

Tesla Sells Green Energy Credits

Apart from battery systems and electric cars, Tesla also deals in green credits as a source of revenue. The company sells energy credits to businesses that need them to comply with environmental regulations. Clients include other automakers, oil and gas providers, and retail electricity companies. 

As it turned out, credits are in high demand. Tesla made a killing in selling these credits. In fact, during the fourth quarter of 2020, regulatory credit sales totaled four times as large as Tesla’s net profit during the same period. Meanwhile, Stewart personally helped Tesla earn over $3.8 billion from regulatory credits since 2017.

Tesla Hopes To Sell Electricity In Texas

If they receive the green light to sell electricity, Tesla will utilize its workforce from its energy division. The workers that helped sell solar rooftops will now help sell utility services to Texans and provide customer service. Tesla’s application also wrote that it will work with Engie Energy Marketing on scheduling.

Watch the Torque News video report about Tesla is connecting a secret Mega-battery into the Texas Grid in Angleton:

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