When Elon Musk unveiled the Model 3 on the 31st of March, 2016, he said: “Why does Tesla exist? (..) We have record high CO2 levels (..) Which results in a steadily increasing temperature (..) It makes a difference if we accelerate the transition to sustainable transport”.
The CO2 concentration levels surpassed 400 parts per million in 2013. This growth in CO2 levels shows a very strong correlation with fossil-fuel burning according to Nasa. For this reason, policy makers are working towards reducing the use of cars in big cities. In Mexico City for instance, a regulation was implemented in 2016 called “Hoy No Circula” (No Circulation Today). The program requires that every vehicle that wants to move within the metropolitan area of Mexico City has to go through a verification process in an approved center. According to the evaluation results, the vehicle receives a sticker which states how many days of the week the car can circulate. A “0” sticker means that the car can circulate every day, while on the other extreme a “2” sticker cannot circulate for one day nor Saturdays. The main goal of this initiative is to reduce the levels of pollution.
Figure 1: CO2 levels over time 
Similar metropolises are also implementing experimenting with similar road space rationing programs. None of these programs affect electric cars, however. Programs such as these which foster the adoption of electric vehicles while raising public awareness about the negative effects of driving an internal combustion engine vehicle represent an enormous opportunity for Tesla. The Model 3 which will be launched in 2018 can be especially powerful for this purpose, given that it will be more accessible than previous Tesla models (starting at $35,000 USD) and targeted towards the mass market.
Other policies that support sustainability are also being implemented. In Mexico, the “Fideicomiso para el Ahorro de Energía Eléctrica” (Trust for the Savings of Electrical Energy) funds 100% of new projects for the micro generation of energy of up to 500 kW, including solar. In the United States, the Business Energy Investment Tax Credit is a rebate in which the owner of a solar panel can claim 30% of installation expenditures as a tax credit. The expiration date of this policy was extended in 2015 to be valid until 2022. Germany has 40 million kW of installed photovoltaics thanks to the German Renewable Energy Sources Act, which provided a feed-in tariff to increase the investment in renewable energies.
Figure 2: Installed generation of power (bars) and energy (line) from photovoltaics in Germany over time 
To fully embrace the mission to “accelerate the world’s transition to sustainable energy”, Tesla announced the acquisition of SolarCity in August of 2016. SolarCity is a company that produces, finances and installs solar photovoltaic systems. The rationale for this acquisition is explained by Tesla as following:
“Energy needs to be sustainably generated, sustainable energy needs to be stored for later use, and sustainable energy needs to be used for transportation. And to be effective, the technology used for generation, storage and transportation all need to work together in an integrated way that makes the experience seamless. (..) First, there will be a solar roof that will generate sustainable energy from a rooftop that looks better and is more durable than a normal roof, that can be easily customized to fit the unique needs of each house, and that will lower costs to the consumer. Second, the Powerwall 2 storage system, which starts production this quarter at the Gigafactory, will take the energy that is generated by any source and use it when it’s most beneficial, such as during the night, during a power outage, or when the customer can make money by doing so. Third, sustainable energy needs to be used for transportation, which is why electric vehicles are so important.”
I believe that Tesla could be more active in lobbying to encourage policy makers to work on more initiatives to foster the adoption of alternative energy. While the efficiency of solar panels has increased while the costs have decreased, the economics still do not support adoption compared to traditional sources of energy. For this reason, the government should further incentivise adoption to help companies such as Tesla/SolarCity grow. This scale will allow them to reduce costs and organically foster adoption of their technologies in everyone’s houses.
- Tesla, “Tesla Unveils Model 3” YouTube, published March 31, 2016, https://youtu.be/Q4VGQPk2Dl8, accessed November 2016.
- Nasa, “Graphic: The relentless rise of carbon dioxide”, http://climate.nasa.gov/climate_resources/24/, accessed November 2016.
- Gobierno de la Ciudad de México, “Hoy no Circula”, http://www.hoy-no-circula.com.mx/, accessed November 2016.
- Tesla, “Model 3”, https://www.tesla.com/model3, accessed November 2016.
- SEMARNAT, “Guía de Programas de Fomento de Energías Renovables”, http://www.conuee.gob.mx/pdfs/generacion_distribuida/GuiaProgramasFomentoEnergiasRenovablesMunicipiosRepublicaMexicana.pdf, accessed November 2016.
- gov, “Business Energy Investment Tax Credit (ITC)”, http://energy.gov/savings/business-energy-investment-tax-credit-itc, accessed November 2016.
- Bundesministerium für Wirstschaft und Energie, “Entwicklung der Stromerzeugung und der installierten Leistung von Photovoltaikanlagen “, http://www.erneuerbare-energien.de/EE/Redaktion/DE/Textbausteine/Banner/banner_photovoltaik.html, accessed November 2016.
- Tesla, “Tesla and SolarCity to Combine”, https://www.tesla.com/blog/tesla-and-solarcity-combine, accessed November 2016.
- Tesla, “Tesla and Solar City”, https://www.tesla.com/blog/tesla-and-solarcity, accessed November 2016.