By the megawatt, solar installations are outpacing other energy sources in the U.S. this year — but you wouldn’t know it judging from Tesla’s latest reports.

Once among the top three residential installers in the nation, Tesla’s solar business is in decline. In the third quarter, the automaker’s solar deployments slipped to 49 MW, down 48% from the same period last year. The company’s solar deployments are also down sequentially, from 67 MW in Q1 2023 to 66 in Q2 and down to 49 in Q3. So much for “solar roofs” taking over.

Yet, Tesla pulled in 40% more revenue overall from its “Energy generation and storage” arm in Q3. How come? By comparison, the company’s energy storage business is booming. The business includes both Tesla’s Powerwall home batteries and utility-scale Megapacks.

In Q3, Tesla reported a 90% spike in energy storage deployments, up to nearly 4 GWh (from 2.1 GWh in Q3 2023). The company called it its “highest quarterly deployment ever.” It credited the “ongoing ramp of our Megafactory in Lathrop, CA” for the boost.

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MuskWire TLDR:

According to recent reports, solar installations in the U.S. are surpassing other energy sources this year. However, Tesla’s solar business is experiencing a decline. In the third quarter, Tesla’s solar deployments decreased by 48% compared to the same period last year, reaching 49 MW. This decline is also evident when comparing the solar deployments in Q1 and Q2 of 2023, which were 67 MW and 66 MW respectively. Despite this decline, Tesla’s “Energy generation and storage” arm saw a 40% increase in revenue in Q3. This increase is attributed to the booming energy storage business, which includes Tesla’s Powerwall home batteries and utility-scale Megapacks. In Q3, Tesla reported a 90% surge in energy storage deployments, reaching nearly 4 GWh, the company’s highest quarterly deployment ever. This increase is credited to the ongoing expansion of Tesla’s Megafactory in Lathrop, CA.