Solar energy equipment supplied by Tesla Inc TSLA can generate funds if a Bitcoin (BTC) miner is attached to it in the pre-installation period, according to Cathie Wood-led Ark Investment Management LLC’s Director of Research, Brett Winton.
What Happened: Winton disclosed on Twitter Wednesday he had solar installed since January by Tesla but it “hasn’t generated a single watt-hour” as the utility had not yet approved the connection.
He also said he was yet to pay Tesla for the installation as the company won’t collect till it begins to generate power.
“Put another way, I paid for this friction on the higher upfront cost required to pay back Tesla for its cost of capital,” said Winton in a separate Tweet.
See also: Is Bitcoin a Good Investment?
According to Winton, if a Bitcoin mining equipment was attached to the system, the solar could probably have generated $1,500 over the time he has waited for it to be approved by the utility, but instead, it has “lain idle.”
The Ark executive touched on the involved costs, which he said were $17,000 for the solar system and $20,000 for the “right-sized miner.”
Had Tesla sold the solar and battery system coupled with the bitcoin miner — prior to the interconnect approval the system — it “could operate closed loop against the miner; after interconnect the dispatch algorithm would optimize between revenue per hash and the grid,” said Winton.
Tesla CEO Elon Musk clarified in a reply to Winton that utility permission is not usually required if electricity is stored in the company’s battery.
Did you buy a Powerwall? Utility permission is required for flowing electricity back to grid, but usually not if stored in our battery. This also enables 24/7 electricity security for your home.— Elon Musk (@elonmusk) April 21, 2021
Utility permission is still needed for when Powerwall is full & can stabilize grid.
Why It Matters: Musk announced later that Tesla will only sell solar panels and roofs bundled with its Powerwall beginning next week.
Winton suggested that there is a “product opportunity” in relation to Bitcoin miners but his math was “very rough” on Twitter.
BTC touched an all-time high of $64,863.10 on Apr. 14 and its high valuation has spurred interest in cryptocurrency mining in general. BTC traded 2.96% lower at $54,067.39 at press time.
Stocks of several cryptocurrency mining companies such as Canaan Inc CAN, Sos Ltd SOS, Riot Blockchain Inc RIOT have been on a tear in conjunction with the white-hot cryptocurrency markets.
Canaan, Sos, and Riot shares have spiked 132.2%, 191.2%, and 143.1% respectively since 2021 began.
Tesla invested $1.5 billion in Bitcoin in February and has become irresistible to institutional investors such as Jack Dorsey-led Square Inc SQ and MicroStrategy Incorporated MSTR.
Price Action: Tesla shares closed 3.5% higher at $744.12 on Wednesday and fell 0.47% in the after-hours session.
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