Elon Musk is consistent on many fronts, from taking polls on Twitter on managerial decisions to not hiding his dislike for public transit. Another habit he is certainly not letting go of is revising his Master Plan every so often, then making it an open secret. In a nutshell, Musk launched the Tesla Master Plan Part 3 in March 2023.
It’s not an improvement over Part 2 and does not even resemble the Secret Plan Part 1. We have gone through the 41-page document that explains the Tesla Master Plan part 3 and have synthesized it for you. Read on to find out what the plan is all about, its rationale, how Tesla plans to achieve it, and the expected results.
Sustainable Energy for All of Earth
In the early versions of the Master Plan, Tesla seemed to focus on sustainable vehicles and saving the Earth. This was to be achieved by reducing transport-based pollution. In this third installment of the Master Plan, the aim is the same, just more wholesome; to transform the entire world into a sustainable energy economy.
Dubbed, Sustainable Energy for All the Earth, the Master Plan highlights how Tesla will lead the global effort to eliminate fossil fuels. The goal is to achieve global sustainable energy without destroying the environment. At least not faster than the current alternatives.
Tesla outlined six steps to achieving this, but they are more like six fronts because most are mutually exclusive. These are as follows:
- Powering the existing grid with renewables
- Switching to electric vehicles
- Using heat pumps in residential, business, and industrial premises
- Electrifying high-temperature heat delivery and hydrogen production
- Using sustainable fuel options for planes and boats
- Manufacturing a sustainable economy
Since most of the points are as vague as they come, we shall do a rundown of what each one means and how Musk intends to achieve them. But, first, let’s take Simon Sinek‘s advice and start with WHY?
What Is the Motivation?
The Master Plan is based on and motivated by the energy facts and statistics of recent years. And one of the key sources is the International Energy Agency (IEA) 2019 World Energy Balances. According to that report:
- The annual global primary energy supply is 165PWh (petawatt hours).
- The total annual fossil fuel supply is 134PWh, which is slightly above 80% of the total supply.
- 61PWh (37%) of the total energy supplied, most of which is from fossil fuels, is consumed before reaching the end user.
- Another 44PWh (27%) is lost by inefficiencies at the end user, such as combustion engines and natural gas furnaces.
- Only 36% of the total supplied energy does meaningful work or heat.
What Does This Mean?
From this breakdown, Musk concludes that it is possible to eliminate the use of fossil fuels and still achieve the same amount of work and heat, if not more. However, attaining this will require building more energy-efficient systems and exploring other sustainable energy sources.
According to the Master Plan, going for an electrified economy that depends on sustainable energy eliminates the upstream losses associated with mining, refining, and burning fuels to generate power. It also reduces non-electric losses downstream, such as fuel furnaces.
However, this change comes at a cost. According to Tesla, the energy input for certain industrial processes, such as the production of hydrogen, will increase. Mining and refining activities for metals and minerals required for batteries, wind turbines, and solar panels will also increase.
The Master Plan Part 3, therefore, clearly outlines how Tesla aims to achieve sustainable energy for the Earth without destroying the environment. The automotive and clean energy company offers to do this in six ways or steps:
According to IEA reports, the annual energy supplied for the generation of electricity is 65PWh, of which 46PWh is from fossil fuels. However, only 26PWh of electricity is produced, as the rest is lost through the inefficiencies that come with converting fossil fuels.
Repower the Globe’s Existing Grid With Renewable Energy
Therefore, only 26PWh is the load that the world needs. According to Tesla, it is the energy that we should aim to produce and that can be achieved without using fossils.
Transition to EVs
Tesla seems not to be worried about the growing competition in the EV segment. In fact, the automaker would rather have competition here than enjoy monopoly at the cost of the environment. So, this second solution aims to push for an overhaul from combustion engines to EVs.
It argues that because electric vehicles have higher powertrain efficiency, more optimized design, and regenerative braking, they are almost four times more energy efficient than combustion engines.
To prove this point, it compares Tesla’s most popular sedan, the Model 3, and its gas-powered Toyota equivalent, the Corolla. The conclusion is that switching to EVs will increase the annual electrical energy demand by 7PWh while eliminating 28PWh/year of fossil fuels used in the transportation sector.
Cut Down Energy Usage in Homes, Businesses, and Industries by Installing Heat Pumps
We will avoid the jargon and only say that the idea is to use heat pump technology in residential, business, and industrial spaces. Heat pumps, for example, use three times less energy than gas furnaces.
As a result, using heat pumps will eliminate 18PWh of fossil fuels while creating 6PWh of demand. In industries, the shift will create an additional 5PWh annually while eliminating the 12PWh of fossil fuel.
The Use of High Temperatures (>200C) And Hydrogen
The objective is to use electricity instead of fossil fuels in industrial applications. These include the production of steel, fertilizer, cement, etc. It suggests using electrical resistance heating or thermal storage when there is a surplus of renewable energy.
Assuming equal heat delivery efficiency, this will replace 9PWh/year of fossil fuels with a 9PWh/year electrical demand.
Sustainably Produce Hydrogen
It is not clear why Tesla did not make this a solution on its own. The objective is to use green hydrogen instead of that produced from coal, oil, and natural gas. It is possible through the electrolysis of water or methane pyrolysis. As a result, it will reduce annual fossil fuel usage by 8PWh while increasing electrical demand by 7PWh.
To get to these values, Tesla made certain assumptions worth noting:
- No hydrogen will be needed for fossil fuel refining
- Reduced iron will be used in steel production, making hydrogen an input
- All global hydrogen will be produced through electrolysis
Use Sustainable Fuel Options for Planes and Boats
The Master Plan Part 3 suggests an array of ways to increase energy sustainability in planes and boats. They include:
- Optimizing design speed and routes of ships and aircraft to enable powering by smaller batteries and more stops for recharging
- Using synthetic fuels to power long-distance flight
- Sourcing carbon and hydrogen for synthetic fuels from biomass
Once done, it will eliminate 7PWh/year of fossil fuel and increase electrical demand by the same amount.
Build a Sustainable Energy Economy
In their presentation, Tesla mentioned that rolling out clean energy solutions over the next 20 years will cost 60% of fossil fuel investment (based on the 2022 investment rate).
The projections indicated that building a safe energy generation and storage portfolio (i.e., wind turbines, batteries, and solar panels) will cost $10 trillion, cheaper than the $14 trillion projection investment in fossil fuels over the next two decades.
Tesla’s report finds that moving Earth to a sustainable energy economy is technically feasible!
Tesla estimates that applying the 6 steps will:
- Displace 125PWh/year of fossil fuel and replace them with 66PWh of sustainably produced electricity
- Create a new industry for producing solar panels, batteries, and wind turbines, which will require an additional 4PWh/ year.
- Annually, vehicle, ship, and plane fleets will require 112TWh, 40TWh, and 0.02TWh of batteries, respectively.
- Material extraction will be reduced from 68 Gt to 10.8 Gt (gigatons).
What Will It Take?
According to the Mater Plan, achieving the goal will require a $10 trillion investment over a period of 20 years. Tesla justifies this by pointing out that a similar projection for fossil fuels would cost $14 trillion. The most required materials will be copper, lithium, graphite, cobalt, nickel, manganese, and battery-grade iron.
On land area, Tesla estimates that solar farms will take about 71.4 million acres, and that windmills will require 9.2 million acres of land. This sounds like a lot of land, but it totals less than 0.23% of the total land area.
A study by IEA showed that achieving such a feat by 2050 would require 60 million circuit miles. Add this to solar panels and batteries; the materials required come to 444 million tons annually.
As solar panels, batteries, and turbines reach the end of their life, recycling will be an essential part of the process.
What Is Missing From the Tesla Master Plan 3?
In addition to a clear guideline on how Tesla is going to achieve any of these goals, there are other details that most Tesla lovers, haters, and competitors found conspicuously missing from the Master Plan.
The first one is the lack of information on new vehicles. Even though during the launching event in Austin, Tesla showed two covered vehicle models, no mention of them is made in the Master Plan.
The second missing piece is the mention of other companies owned by Elon Musk, such as SpaceX, Starlink, or The Boring Company. Maybe it’s because this was a purely Tesla affair.
Finally, one painfully missing piece was how this Master Plan is a revised version of any previous Master Plan. To explain this, here is a summary of the earlier master plans.
Master Plan Part 1 (2006): Named the ‘Secret Tesla Motors Master Plan (just between you and me),’ it introduced Elon Musk to the world. It had one objective: to build affordable zero-emission vehicles. To achieve it, Tesla was to build an expensive sports car, use the money to build affordable EVs and then build more EVs. It achieved most of this.
Master Plan Part 2 (2016): Titled ‘Part Deux,’ it promised to develop stunning solar roofs, expand EVs to all segments, and deliver full self-driving vehicles and robotaxis. Most of these have not been achieved yet. Cybertruck, for example, will not be available until 2024.
First, it is worth pointing out that Master Plan Part 3 does not appear to be a continuation of any previous Master Plan. Instead, it is a quest into a new venture to save the Earth in its entirety instead of one vehicle at a time.
That said, most of it makes sense, at least on paper. Whether Tesla or Musk will be able to pull it off is a different matter. We saw him deliver the first Master Plan and flop with the second. Will he use this new plan to redeem himself from the mistakes of the previous quest, or will factors beyond him derail him again?
Only time will tell.