While 21st century Renaissance man Elon Musk has people gushing at his "Hyperloop" mass transportation infrastructure, I'm more interested to see when he stops putting around and gets back to real business. And I'm willing to bet Musk has to be looking hard at getting into the solar cell production business as the next logical building block of his empire.
Most everyone is familiar with two out of Musk's three current businesses. SpaceX (News - Alert) makes spaceflight systems -- rockets and capsules -- with a current flight manifest of $4 billion of launch contracts. Tesla Motors makes all-electric cars. Both businesses started with clean sheet designs and built new manufacturing lines to produce hardware, complemented with business models challenging the status quo.
SolarCity (News - Alert) is the third leg of Musk's business interests, a provider of solar power systems in the United States run by his cousin/co-founder Lyndon Rive. SolarCity is a full service solar provider and the largest residential solar installer in the United States, providing a turn-key solution for installing a solar panel solution for individual homes, businesses, and government organizations. Unlike SpaceX and Tesla, SolarCity is a systems integrator and service provider so it doesn't build things from basic parts.
What do all of Musk's businesses plus the Hyperloop have in common? A need for clean, renewable power. The free-flying cargo version of the SpaceX Dragon capsule uses solar panels while Musk's longer-term plans include a retirement villa on the surface of Mars. Public discussions of Martian colonization architectures have included solar-electric "tugs" to cost-effectively move supplies to the Red Planet and for providing power once on the surface. Tesla cars need electricity. As Tesla recharging stations propagate across the country, some power may be supplied by solar cells.
SolarCity's need for solar panels is self-evident. The 56-page draft document for the Hyperloop says the physical "tube" structure between San Francisco and Los Angeles would be covered by solar panels generating around 52 MW of power when the sun is up; since the transport system itself only needs an estimated 6 MW to operate, the Hyperloop operator would be a utility as well.
Enter two issues currently taking place in the power world: A solar panel tariff war with China and a glut of natural gas. The U.S. Commerce Department has slapped tariffs on Chinese panels and China has reciprocated with a tariff on U.S. polysilicon source material imported my its manufacturers, thereby leading to a non-virtuous cycle raising prices on solar panels. U.S. natural gas provides cheap energy to produce lower-cost polysilicon, but there are few places in the country making solar panels.
Combine the above two factors with a strategic need for Musk's ventures to be supplied with renewable and affordable power. Add Elon Musk's track record in manufacturing and challenging the status quo. We shouldn't be surprised if Musk unveils a faster/cheaper/better solar panel production line in the future to supply his other venture of today (SpaceX, Tesla, SolarCity) and in the future (Mars colonization, Hyperloop).
Edited by Rachel Ramsey