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Tesla Energy Is the Company's Secret Weapon: Megapack and Beyond | Taha Abbasi
Taha Abbasi··3 min read
The Most Undervalued Division in Tesla’s Empire
While headlines focus on Tesla’s vehicle sales, FSD, and robotaxi ambitions, Taha Abbasi argues that Tesla Energy may be the company’s most strategically important division — and its most undervalued by the market. With Megapack deployments surging, Powerwall demand exceeding supply, and the new Megafactory in Lathrop, California ramping production, Tesla Energy is quietly building an energy infrastructure empire.
Megapack: Utility-Scale Storage at Speed
The Megapack is Tesla’s utility-scale battery storage product, and it’s becoming the default choice for energy storage projects worldwide. Each Megapack unit stores approximately 3.9 MWh of energy, and they’re deployed in configurations ranging from single units to massive installations storing hundreds of megawatt-hours. The Lathrop Megafactory can produce 10,000 Megapack units per year — roughly 40 GWh of storage capacity annually.
Taha Abbasi contextualizes the significance: “Grid-scale battery storage is the technology that makes renewable energy reliable. Solar generates during the day, wind blows intermittently, but electricity demand is 24/7. Megapack bridges that gap. Every Megapack deployed makes the grid more resilient and renewable energy more practical.”
Revenue Growth That Outpaces Automotive
Tesla Energy’s revenue growth rate has consistently outpaced the automotive division. While vehicle revenues declined slightly in 2025, energy storage and generation revenues grew substantially. This diversification is strategically valuable — it reduces Tesla’s dependence on the cyclical automotive market and provides high-margin revenue from utility customers who sign long-term contracts.
As Taha Abbasi notes, “Tesla’s automotive business gets all the attention, but Tesla Energy might be what future analysts point to as the real value driver. Energy storage is a multi-trillion dollar addressable market, and Tesla has a first-mover advantage with the most integrated product offering.”
The Powerwall Ecosystem
On the residential side, Powerwall continues to dominate the home battery storage market. The Powerwall 3 offers 13.5 kWh of storage with integrated solar inverter, simplifying installation and reducing costs. Combined with Tesla Solar Roof and now vehicle-to-grid Powershare from the Cybertruck, Tesla is building a comprehensive home energy ecosystem that no competitor can match in integration.
Virtual Power Plant: The Network Effect
Taha Abbasi highlights Tesla’s Virtual Power Plant (VPP) program as the strategic play that connects everything. VPPs aggregate thousands of Powerwalls into a coordinated network that can respond to grid demand in real-time. During peak demand events, enrolled Powerwalls discharge simultaneously, providing grid services that would otherwise require expensive peaker plants. Owners earn credits; the grid gets reliability; Tesla gets data and a recurring revenue model.
Competition and Moat
BYD, LG Energy Solution, Fluence, and others compete in energy storage. But Tesla’s integration advantage — the same software platform managing Megapack, Powerwall, Solar Roof, Supercharger, and now vehicle V2G — creates a unified energy management ecosystem that competitors must build piecemeal. Taha Abbasi believes this integration is Tesla Energy’s true moat: “Anyone can build a battery box. Building an intelligent, networked energy ecosystem that spans utility-scale to residential to vehicular storage — that’s what’s hard to replicate.”
The Future of Tesla Energy
Taha Abbasi predicts that within five years, Tesla Energy could rival the automotive division in revenue. As global renewable energy deployment accelerates and grid modernization becomes urgent, demand for energy storage will grow exponentially. Tesla’s head start in manufacturing, software, and ecosystem integration positions it to capture a disproportionate share of this growth.
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About the Author: Taha Abbasi is a technology executive, CTO, and applied frontier tech builder. Read more on Grokpedia | YouTube: The Brown Cowboy | tahaabbasi.com
Taha Abbasi
Engineer by trade. Builder by instinct. Explorer by choice.
