November 29, 2021

2008 Was The Worst Year Of Elon Musk’s Life

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elon-musk-tesla-82By Ajai Raj From Business Insider

Between scoring a contract to shuttle astronauts to the ISS, unveiling the latest model of the groundbreaking Tesla, and making ownership of solar power systems more affordable than ever before, to say that Elon Musk is having a good year would be a serious understatement.

But just 6 years ago, things looked very different

Ross Anderson from Aeon writes:

It was 2008, a year Musk describes as the worst of his life. Tesla was on the verge of bankruptcy. Lehman had just imploded, making capital hard to come by. Musk was freshly divorced and borrowing cash from friends to pay living expenses. And SpaceX was a flameout, in the most literal sense. Musk had spent $100 million on the company and its new rocket, the Falcon 1. But its first three launches had all detonated before reaching orbit. The fourth was due to lift off in early Fall of that year, and if it too blew apart in the atmosphere, SpaceX would likely have numbered among the casualties. Aerospace journalists were drafting its obituary already.

Confirming the old adage that it’s always darkest before the dawn, Musk’s lowest point led to his greatest triumph yet:

Musk needed a break, badly. And he got it, in the form of a fully intact Falcon 1, riding a clean column of flame out of the atmosphere and into the history books, as the first privately funded, liquid-fuelled rocket to reach orbit.

The rest, as they say, is history.

Musk is now worth 11.7 billion, according to Bloomberg. Both SpaceX and Tesla (and even SolarCity) are succesful, and he’s remarried. What a difference a few years can make.


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Related story:

Elon Musk just made it way cheaper to live off solar power

By Ajai Raj From Business Insider

Outfitting your home with cheap solar power just got a lot easier.

Elon Musk-chaired Solar City, the biggest name in residential solar power, is now offering loans to allow their customers to own their solar panels for cheaper than their current lease offerings.

The loan option, called MyPower, is structured like an energy payment, in that the customer pays off the loan by paying their energy bill — and it’s a win-win, because these payments can end up being cheaper than your traditional power bill. And after 30 years, the power is free.

Here’s how it works, according to SolarCity founder and CEO Lyndon Rive: customers take out a 30-year loan on a solar power system at 4.5% interest. SolarCity installs and maintains the system at no cost to the customer, and the customer pays for the power — and in the process, pays off the loan.

Typically loans available for homeowners to fit themselves with solar utilities are usually offered by third-party banks and municipalities in partnership with solar companies, and do not take into account how much power is being produced by the system. That means if the system underperforms, the customer loses money.

Instead, with SolarCity’s direct financing, “you only pay based on the production of the system,” which SolarCity will monitor and guarantee against drops in performance, Rive told Business Insider.

“We’re able to do this because we have a very good understanding of how well your system is going to perform,” Rive said.

Energy from the power company typically costs, on average, 13 cents per kilowatt-hour (with wide regional variation), ranging as low as 9 cents and as high as 20 cents. The price also increases by 4% to 6% every year. Under the MyPower program, customers will pay 16 cents for every kilowatt-hour they use in the first year, after which most people get a 30% federal tax credit that drives the cost down to 12 cents per kilowatt-hour. Year after year, the price will increase by 2.9% — less than the usual increase from the typical power company.

In the end this loan program ends up cheaper than their leasing agreement offer, the “Power Purchase Agreement,” in which customers pay 15 cents per kilowatt-hour, increasing at 2.9% per year. They are going to continue offering the leasing option for customers, though in most cases it will be more expensive to lease than to own. “The only reason you’d go with a lease is if you pay low or no federal taxes,” in which case the 2nd year 30% tax credit would not apply, he added.

And depending on where you live, it’s potentially much cheaper than traditional power-company power. According to the US Energy Information Administration, the typical US resident used 10,837 kilowatt-hours of power in 2012. For a household paying the average rate of 13 cents per kilowatt-hour, that power would cost about $1400. In the first year, that household would pay about $330 more for their power, but in the second year they would see a savings of about $100. But a household paying 20 cents per kilowatt-hour would see a more dramatic savings of about $430 in the first year, and $870 in the second year.

In addition to saving money, solar power substantially reduces pollution compared to fossil fuels, and allows households to move towards energy independence.

One possible disadvantage to the MyPower program is that solar power, like virtually all technology, is bound to improve dramatically over the next 30 years, both dropping in cost and increasing in efficiency. In fact, futurist Ray Kurzweil predicts that we will have unlimited, free solar energy in just 20 years. If that happens, SolarCity owners could find themselves paying for obsolete equipment.

However, as Jonathan Bass, SolarCity’s vice president of communications, wrote in an email: “The value of the solar system is the electricity it produces. Electricity is a commodity, and we expect it to become more valuable, not less, over the next 30 years as retail rates rise, so we don’t expect customers to want to incur the cost of installing a new system during the term.”

The MyPower program will help SolarCity expand their residential solar power products into new markets — and could dramatically decrease the cost of power for many people.

IMAGE: solarcity

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