Elon Musk says solar power doesn't threaten utilities

The shingles on this roof are solar panels
The shingles on this roof are solar panels

Elon Musk thinks utilities have nothing to fear from rooftop solar power systems.

Reports have circulated of an ongoing "war" between solar power companies, and utilities in the United States, that hinges on a few key issues.

One is that many states have "net metering" laws that require utilities to essentially buy back the power customers produce if it is in excess of what they owe. There are also concerns that solar power customers can go off-the-grid — reducing the number of people who rely on the grid for electricity and passing the costs to its remaining customers.

Speaking at the unveiling of Tesla and SolarCity's solar-roof-and-battery system on Friday, Musk, who is chairman of both companies and CEO of Tesla, spoke about why his vision for solar power in America and beyond will require more power drawn from utilities, not less.

Musk did not address specific complaints against solar power's impact on power grids, but he did explain why he thinks utilities will still be needed to deliver power.

"I want to make sure people appreciate that the solution is both local power generation and utility power generation, it is not one or the other," he said. "Sometimes the solar roof is positioned as a competitor to utilities, but we are actually going to need utility power to increase, and we are going to need local power generation. Because if you transition all energy to electric, that roughly triples the amount of electricity that is needed. So you need about a third for transport, about a third for heating and about a third for what we currently use as electricity."

He added that he expects the future would be based on "a third local power generation, roughly two thirds utilities. So I think it is a very bright future for utilities and for rooftop."

Perhaps come common ground is being found: Tesla is installing 80 megawatts of its Powerpack batteries at a Southern California Edison facility in Mira Loma, California, and planning another 52 MWh installation for a utility on the island of Kauai.

Friday's event comes ahead of the Nov. 17 shareholder vote on Tesla's planned merger with SolarCity. While some have criticized the deal, Musk has insisted it is a key part of Tesla's future development.