On Thursday, Nevada Gov. Brian Sandoval and Tesla Motors CEO Elon Musk announced, as we revealed yesterday, that indeed the Reno Nevada area has been chosen as the Gigafactory location. As if to answer critics of the size of the incentive package, Gov. Sandoval stressed the job creation (over 22,000 direct and indirect jobs) potential of this project, as well as the $100 Billion in economic activity the Gigafactory will bring to Nevada over the next 20 years.
Gov. Sandoval called this a monumental announcement that will change Nevada forever. Sometimes politicians like to go overboard with the hyperbole, but in this case he might be on the mark. It all depends on whether Tesla Motors does manage to carry out the task they’ve set out to do – that is, launch production of 400,000+ electric cars per year.
The deal is subject to “legislative review and approval,” according to Gov. Sandoval. He didn’t say it today, but yesterday we learned a special session of the state Legislature has been called for next week.
The gains named by Gov. Sandoval are expected to result in an 80-to-1 return on investment, that is Nevada will see $80 worth of economic impact for every dollar invested. The investment he’s talking about is the incentives package offered to Tesla by the Nevada governments. Those gains include
- $100 Billion in economic impact over the next 20 years
- Create 3,000 construction jobs immediately
- Employ 6,500 people, at an average wage of $25 per hour, plus benefits
- Create another 16,000 indirect jobs in other industries
- Add 4% to the states GDP Additional research dollars for Nevada’s universities, and other educational benefits Tesla Motors will directly fund some of Nevada’s K-12 educational system
As we noted in yesterday’s piece, some watchdog groups have raised questions about the incentives package being offered Tesla Motors. They complained that the negotiations were conducted in secret, no public input. Sandoval’s answer clearly is to point to all the economic gains, and also point to the phalanx of elected officials on the stage all of whom were involved with negotiating the deal. Sandoval especially called out Sen. Harry Reid, who is in Las Vegas chairing his clean energy summit, but who went to bat in a big way to win the deal.
What do we learn from this about the factory itself? Unfortunately the livestream cut out just as Elon Musk was about to speak, but the picture above captured from Twitter speaks volumes.
Net Zero Energy Factory: This is a big item in that Tesla is doubling down on clean technology, clean energy. A critique of electric cars is the environmental impact of the energy required to build the things. But, if there’s no energy impact those critics are answered.
Solar panels, Wind turbines: How will Tesla achieve “Net Zero Energy”? Clearly from the picture they plan to install a massive solar and wind power facility. Solar panels enough to cover the whole roof of a 10 million square foot factory is a significant amount of energy. The factory site is set in a mountainous area just east of Reno, and the wind turbines are shown as being placed above the factory on the mountain slopes.
50 Gigawatt-hours of production: We already knew this, but it’s worth reiterating. Building 500,000 electric vehicles a year requires a tremendous volume of battery pack production.
500,000 electric cars per year: Oh my. It wasn’t that many years ago that I had to build my own electric car because the car makers weren’t doing so. Let this sink in, please. In 2010 the only electric cars on sale were the Tesla Roadster and a few Neighborhood Electric Vehicles. Today, plug-in electric vehicles are selling at well over 100,000 units a year in the U.S. and well over 200,000 a year worldwide. Tesla Motors intends to single-handedly be selling 500,000 a year by 2020.
Gov. Sandoval probably means well, but he’s overly focused on the jobs and economic gains. Those of us who have been pushing for electric vehicles for years need to let this sink in. The last three and a half years since the Leaf/Volt combo went on sale have been quite a ride. We ain’t seen nothing yet, if Tesla Motors does pull this off.
Here’s a few quotes from Tesla’s press release:
“This is great news for Nevada. Tesla will build the world’s largest and most advanced battery factory in Nevada which means nearly one hundred billion dollars in economic impact to the Silver State over the next twenty years. I am grateful that Elon Musk and Tesla saw the promise in Nevada. These 21st century pioneers, fueled with innovation and desire, are emboldened by the promise of Nevada to change the world. Nevada is ready to lead,” stated Governor Brian Sandoval.
“I would like to recognize the leadership of Governor Sandoval and the Nevada Legislature for partnering with Tesla to bring the Gigafactory to the state. The Gigafactory is an important step in advancing the cause of sustainable transportation and will enable the mass production of compelling electric vehicles for decades to come. Together with Panasonic and other partners, we look forward to realizing the full potential of this project,” said Elon Musk, Chairman and CEO of Tesla Motors.
“On behalf of the State of Nevada, I would like to acknowledge this monumental day and provide my initial support. This is a significant opportunity to make a major stride to improve our statewide economy. I look forward to receiving the necessary information so the Legislature can meet and take necessary action to support this major industry coming to Nevada,“ stated Speaker Marilyn Kirkpatrick.
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