"Energy Efficiency is at the heart of energy affordability." Tony Earley, Chairman, CEO and President of PG&E Corporation

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Tesla Adds Energy-Efficient Tooling as it Ramps Up Production of Electric Sedan

By Matt Nauman

From left, Tom McGuinness of Lockheed Martin joined Peter Natale, Dag Reckhorn and Gilbert Passin of Tesla Motors and PG&E’s Greg Hoaglin and Jerry Leong at the carmaker’s factory.

FREMONT – Tesla Motors has begun making beautiful, high-end electric sedans at its factory here, but that doesn’t mean the car company doesn’t watch how it spends its money.

That’s why Gilbert Passin, Tesla’s vice president of manufacturing, was so pleased to get a six-figure check from PG&E on Aug. 3.

“This is great,” said Passin as he accepted a check for $156,900 from Greg Hoaglin, an executive manager in PG&E’s energy solutions & service department.

Learn more about the California model for energy efficiency

The money is an energy-efficiency incentive for Tesla’s purchase of three huge machines that make plastic parts for the Model S sedans. The all-electric injection-molding machines – two rated at 500 tons and one at 200 tons – turn tiny beads of plastic resin into more than 80 parts for the Model S. That’s everything from tiny brackets to the front fascia of the car that holds the headlights and the Tesla’s distinctive “T” logo to the car’s aluminum body.

The machines, which will be used in lieu of less-efficient hydraulic versions, will result in a savings of more than 1.1 million kWh a year for Tesla. In addition, the factory’s peak electric demand will be more than 550 kW lower than if they were using the hydraulic versions. They’ll save Tesla money and, with the PG&E incentive payment, they’ll allow Tesla to recoup its investment in the equipment in just 6.5 years.

So far, Tesla has delivered 50 of its Model S sports sedans. At its Fremont factory, workers are ramping up production.

At a small ceremony inside Tesla’s cavernous factory, Passin was joined by two other Tesla manufacturing officials (Dag Reckhorn and Peter Natale) and Hoaglin and PG&E’s Jerry Leong. Tom McGuinness, an energy engineer with Lockheed Martin Energy & Security Service, also participated. Lockheed Martin works with PG&E’s industrial customers to analyze the cost savings and help them install more energy-efficient machinery.

“It’s important that we work with our customers to reduce their energy usage,” said Hoaglin. (Click here to read about incentives offered by PG&E to its business customers.)

Tesla said recently that it has now built its first 50 Model S sedans – 29 for customers and 21 to exhibit in its showrooms and for customer test drives. Deliveries started on June 22. The next batch of 50 should be built by the end of August.

The September issue of Vanity Fair magazine described the Tesla Model S as “the most important car of the 21st century.” It is a sleek, fast four-door sports sedan that runs on electricity.

As a maker of emission-free electric cars, Tesla cares about energy efficiency and carbon footprints. It has added windows and skylights at its Fremont factory to benefit from natural daylight.

Prices for the Model S range from $49,900 to $69,900, after a $7,500 federal tax credit. Three batteries (40 kWh, 60 kWh and 85 kWh) are offered, which provide a driving range of 160 to 300 miles. The Model S is sold in four versions, including the Performance version with Nappa leather seats, a carbon-fiber spoiler and 21-inch tires.

Passin said Tesla wants to make its factory as energy-efficient as possible, but “right now, all of our focus is on our launch” and ramping up production at its factory. Still, he said, the company has installed some windows and skylights to bring more natural light into the 1960s-era factory.

“We decided to do as much as we could with as little money as possible,” he said. Future energy-efficiency upgrades are likely, he said.

Tesla’s all-electric sedan is high tech, but its factory off I-880 in Fremont is full of history. From 1960 to 1982, as the General Motors Fremont Assembly, the plant made more than 4 million trucks and cars such as the Chevy Chevelle and the Pontiac Tempest.

Then, from 1984 to 2010, it was the home of New United Motor Manufacturing, Inc., or NUMMI, an innovative GM-Toyota joint-venture that made cars like the Toyota Corolla and the Pontiac Vibe and the Toyota Tacoma pickup. NUMMI workers built nearly 8 million cars over more than 25 years.

Tesla earned a six-figure incentive check for buying three energy-saving plastic molding machines. Peter Natale, a senior manufacturing engineer for Tesla, holds one of the parts made by the new equipment.

After NUMMI shutdown in 2010, Tesla stepped in.

Tesla has said it will make 5,000 Model S sedans in 2012 and 20,000 in 2013.

Natale, a Tesla senior manufacturing engineer, said the plant will quickly go from making 10 cars a week to making 20 and then 100. The company plans to develop other models that will be built at its Fremont factory. Tesla also will provide its battery packs to other automobile manufacturers.

Right now, the factory uses a combination of human and robotic assembly. Near the final assembly line, an indoor test track allows workers to confirm that the cars are being produced without rattles and squeaks. Workers walk, ride bikes or use electric carts to get around the huge factory.

That makes sense, Natale said, because the Model S is “a beautiful car with a small carbon footprint.”

Email Matt Nauman at matt.nauman@pge.com.

This story originally appeared on pgecurrents.com.