These 9 Slides Put the New Tesla Gigafactory in Perspective
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These 9 Slides Put the New Tesla Gigafactory in Perspective

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Title slide Tesla Gigafactory

This week, Tesla Motors officially unveils its massive new Gigafactory 1 at a grand opening event on July 29, 2016.

The ultimate objective of the first Gigafactory is simple, but it is not for the faint of heart. Battery costs are the most expensive component of electric vehicles, and the multi-billion dollar Gigafactory aims to add scale, vertical integration, and other efficiencies together to bring lithium-ion battery costs down.

Costs have already come down faster than most analysts have predicted, and the Gigafactory could be the final catalyst to get below the industry’s holy grail of $100 per kWh. Cheaper battery packs could make electric vehicles competitive with traditional gas-powered vehicles – and if that happens, it is a game-changer for the auto industry.

It’s important to note that the Gigafactory is fairly modular by design, and construction is not completed in full yet. That said, here is what we know about the new Tesla Gigafactory and its possible impact.

1. The Tesla Gigafactory 1 will be the largest building in the world by footprint.

Tesla Gigafactory the largest building by footprint

The Gigafactory will take up 5.8 million sq. ft of space, making it bigger than Boeing’s giant facility in Everett, WA. That’s roughly equivalent to 100 football fields.

While the Gigafactory will certainly be one of the largest factories by volume, it will be hard to compete with Boeing for first place there. Boeing’s Everett facility, which is six storeys high to accommodate the construction giant planes, has a total of 472 million cu. ft of volume.

2. The scale will make production of lithium-ion batteries way cheaper.

Tesla Gigafactory battery production

Tesla recently stated that its current battery cost is $190 per kWh for the Model S.

The Gigafactory aims to reduce battery costs by 30%. Tesla expects this to happen through vertical integration, adding economies of scale, reducing waste, optimizing processes, and tidying up the supply chain.

Tesla CEO Elon Musk has also stated that the company is changing the form factor of the batteries away from the industry standard. Lithium-ion cells used for notebook computer batteries are typically produced in an 18650 cell format (18mm x 65mm), but Tesla will produce them in a 20700 cell format (20mm x 70mm).

3. Tesla initially planned to produce 50 GWh of battery packs by 2020.

Tesla Gigafactory battery production

4. However, Tesla has now moved that target forward by two years.

Tesla Gigafactory battery production

Now, it’s anticipated that Tesla could triple battery production to meet this demand. This means it could produce up to 105 GWh of battery cells, and 150 GWh of completed battery packs. Musk says the current factory size will be sufficient for this ramp-up.

5. This will require serious amounts of raw materials.

Tesla Gigafactory raw materials

We previously showed the extraordinary amounts of materials needed to build a Tesla Model S. The batteries, which currently use an NCA cathode formulation, need lithium, graphite, cobalt, nickel, and other base metals that aren’t used as much in an internal combustion engine.

This has created a significant rush for suppliers of these raw materials. It’s also something we are covering in our five-part Battery Series, in which we are looking at lithium-ion battery demand, as well as the materials that will need to be sourced as electric cars go mainstream.

6. If Tesla hits its 2018 projection, it will be a serious milestone for EVs.

Tesla milestone for EVs

Tesla aims to sell 500,000 cars in 2018. If it hits the mark, it will be a big milestone for the electric vehicle market.

To put that number in perspective, the total amount of sales (all-time) for the three most popular EV models (Leaf, Volt, Model S) added up to only about 404,000 cars as of December 2015.

7. This would also put Tesla on par with major auto brands.

Tesla milestone for EVs

Tesla is still a small auto manufacturer – but if it meets its stated production goal of 500,000 vehicles in 2018, that will be comparable with brands like Chrysler, Land Rover, Isuzu, Volvo, and Lexus.

This still doesn’t compare to a giant like Ford, which sold 780,354 F-series pickups alone in 2015. But, it is a step in the right direction for Elon Musk’s company.

8. For every 500,000 electric cars on the road, 192 million gallons of gas is saved.

Impact on environment

That’s equal to 290 Olympic-sized swimming pools filled with gasoline, or 21,333 tanker trucks.

Even taking into account coal power and pollution, driving a Tesla is already far better for the environment in most states.

9. Other Giga-facts

Other Giga-Facts

The Gigafactory will be 100% powered by renewable energy. It’ll have solar panels covering the roof, while also drawing power from wind and geothermal.

It will employ 6,500 people, and it will have a state-of-the-art recycling system to make use of old battery packs.

Elon Musk says the “exit rate” of lithium-ion cells from the Gigafactory will literally be faster than bullets from a machine gun.

BONUS SLIDE:

Elon Musk's Master Plan for Tesla

Last week, Elon Musk unveiled the “master plan” behind Tesla.

The Tesla Gigafactory will ultimately help to make these ambitions possible.

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Energy

What’s Made from a Barrel of Oil?

Oil is a building block that makes modern life possible. Here are the proportion of finished products that are created from a barrel of oil.

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What Products Are Made from a Barrel of Oil?

This was originally posted on Elements. Sign up to the free mailing list to get beautiful visualizations on natural resource megatrends in your email every week.

From the gasoline in our cars to the plastic in countless everyday items, crude oil is an essential raw material that shows up everywhere in our lives.

With around 18 million barrels of crude oil consumed every day just in America, this commodity powers transport, utilities, and is a vital ingredient in many of the things we use on a daily basis.

This graphic visualizes how much crude oil is refined into various finished products, using a barrel of oil to represent the proportional breakdown.

Barrel of Oil to Functional Fuel and More

Crude oil is primarily refined into various types of fuels to power transport and vital utilities. More than 85% of crude oil is refined into fuels like gasoline, diesel, and hydrocarbon gas liquids (HGLs) like propane and butane.

Along with being fuels for transportation, heating, and cooking, HGLs are used as feedstock for the production of chemicals, plastics, and synthetic rubber, and as additives for motor gasoline production.

Refined Crude Oil ProductShare of Crude Oil Refined
Gasoline42.7%
Diesel27.4%
Jet fuel5.8%
Heavy fuel5.0%
Asphalt4.0%
Light fuel3.0%
Hydrocarbon gas liquids2.0%
Other10.1%

Source: Canadian Association of Petroleum Producers

Crude oil not only powers our vehicles, but it also helps pave the roads we drive on. About 4% of refined crude oil becomes asphalt, which is used to make concrete and different kinds of sealing and insulation products.

Although transportation and utility fuels dominate a large proportion of refined products, essential everyday materials like wax and plastic are also dependent on crude oil. With about 10% of refined products used to make plastics, cosmetics, and textiles, a barrel of crude oil can produce a variety of unexpected everyday products.

Personal care products like cosmetics and shampoo are made using petroleum products, as are medical supplies like IV bags and pharmaceuticals. Modern life would look very different without crude oil.

The Process of Refining Crude Oil

You might have noticed that while a barrel of oil contains 42 gallons, it ends up producing 45 gallons of refined products. This is because the majority of refined products have a lower density than crude oil, resulting in an increase in volume that is called processing gain.

Along with this, there are other inputs aside from crude oil that are used in the refining process. While crude oil is the primary input, fuel ethanol, hydrocarbon gas liquids, and other blending liquids are also used.

U.S. Refiner and Blender InputsShare of Total
Crude oil85.4%
Fuel ethanol4.8%
Blending components3.5%
Hydrocarbon gas liquids3.0%
Other liquids3.3%

Source: EIA

The process of refining a 30,000-barrel batch of crude oil typically takes between 12-24 hours, with refineries operating 24 hours a day, 365 days a year. Although the proportions of individual refined products can vary depending on market demand and other factors, the majority of crude oil will continue to become fuel for the world’s transport and utilities.

The Difficulty of Cutting Down on Crude Oil

From the burning of heavy fuels that tarnish icebergs found in Arctic waters to the mounds of plastic made with petrochemicals that end up in our rivers, each barrel of oil and its refined products impact our environment in many different ways.

But even as the world works to reduce its consumption of fossil fuels in order to reach climate goals, a world without crude oil seems unfathomable.

Skyrocketing sales of EVs still haven’t managed to curb petroleum consumption in places like Norway, California, and China, and the steady reopening of travel and the economy will only result in increased petroleum consumption.

Completely replacing the multi-faceted “black gold” that’s in a barrel of oil isn’t possible right now, but as electrification continues and we find alternatives to petrochemical materials, humanity might at least manage to reduce its dependence on burning fossil fuels.

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Energy

Mapped: Visualizing U.S. Oil Production by State

The U.S. is the largest oil producer in the world. Here we map the share of oil production in the country by all 50 states in 2020.

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Map of U.S. Oil Production by State

Mapped: Visualizing U.S. Oil Production by State

In 2018, the United States became the world’s top crude oil producer. It has strongly held this position ever since.

According to the U.S. Energy Information Administration (EIA), the country accounted for nearly 15% of the world’s total oil production in 2020, churning out close to 13 million barrels of crude oil per day—more than Russia or Saudi Arabia.

Although total U.S. oil production declined between 1985 and 2008, annual production increased nearly every year from 2009 through 2019, reaching the highest amount on record in 2019.

The Dominant Oil Producing States

Impressively, 71% of total U.S. oil production came from just five states. An additional 14.6% came from the Gulf of Mexico, which is a federal jurisdiction.

Here are the five states that produce the largest amount of crude oil:

RankStateOil Production
(billion barrels)
Share of Total Production
1Texas1.7843.0%
2North Dakota0.4310.4%
3New Mexico0.379.2%
4Oklahoma0.174.1%
5Colorado0.164.0%

Rounding the top 10 are states like Alaska, California, Wyoming, Louisiana, and Utah.

Texas is undoubtedly the largest oil-producing state in the United States. In 2020, Texas produced a total of 1.78 billion barrels of oil. Texas is home to the most productive U.S. oil basin, the Permian, routinely accounting for at least 50% of total onshore production. A distant second is North Dakota, which produced about 431.2 million barrels of oil in 2020.

Regional Distribution of U.S. Oil Production

A total of 32 of the 50 U.S. states produce oil. They are divided among five regional divisions for oil production in the U.S., known as the Petroleum Administration for Defense Districts (PADD).

These five regional divisions of the allocation of fuels were established in the U.S. during the Second World War and are still used today for data collection purposes.

Given that Texas is the largest U.S. oil-producing state, PADD 3 (Gulf Coast) is also the largest oil-producing PADD. PADD 3 also includes the federal offshore region in the Gulf of Mexico. There are around 400 operational oil and gas rigs in the country.

Impact of U.S. Oil Production on Employment

Rapid growth in oil production using advanced drilling methods has created high-paying jobs in states like North Dakota and Texas.

Thanks to the rapid development in the Bakken Shale formation, North Dakota boasts the nation’s lowest unemployment rate. The state has also grown personal income and state economic output at a fast rate, due to oil and gas industry growth.

Oil production from the Eagle Ford Shale has transformed a relatively poor region of South Texas into one of the nation’s most significant economic development zones. In fact, due largely to the oil and natural gas industry, the Texas Comptroller estimates that Texas has recovered 100% of the jobs lost during the Great Recession.

Looking to the Future

The U.S. slashed its oil production forecast through next year just as OPEC and its allies begin to roll back their production cuts in the coming months.

U.S. oil output will drop to 11.04 million barrels a day this year, down from a forecasted 11.15 million. This was a result of the deep freeze that shut down the oil industry in Texas. The EIA also lowered its output forecast for 2022 by 100,000 barrels a day.

Despite its forecast for a rise in supply from outside the cartel this year, OPEC said in its report that it is uncertain about the levels of investment expected to determine the non-OPEC supply outlook for the years to come.

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