Poor solar power gets a tough rap sometimes. People say you can't count on it, and that it's never there when you need it. But that may just be because we're not playing to its strengths as well as we could. This week, a study came out of Australia showing that solar energy had helped to meet soaring electricity demand in the extraordinary heat waves that have been cooking our friends Down Under.
The concept here is fairly straightforward. Under normal circumstances, our electricity grid relies on stable power sources that can deliver on a constant, consistent basis. Traditionally, the backbone of this system has been coal-fired power plants, with natural gas-fired plants joining more recently. The problem is that these sources struggle to meet demand spikes under extreme weather events, such as extreme cold (polar vortex, anyone?) or heat. We all run to our thermostats to crank them within an inch of their lives, and there's not enough power on the grid to meet all of that demand. Cue the blackouts.
Now, it's true that renewable sources such as solar and wind are not consistently reliable. No sun, no solar power. No wind, no ... well ... wind power. But these sources are often available during exactly the type of weather events that create that excess demand, and they can back up the grid at those times. This is known as load leveling.
Tesla Motors (NASDAQ:TSLA) and Solar City (NASDAQ:SCTY) figure there's something to this. The two companies have worked together on the DemandLogic system, combining solar power and storage for commercial buildings. Solar City makes the solar array, and Tesla makes the batteries. DemandLogic communicates with the broader electrical grid, allowing it to respond to rate and demand fluctuations.
The future of renewables, and our power grid in general, depends on the proper deployment of a diversity of resources. Tesla and Solar City may be about to reap the rewards. Watch the following video to learn more.
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Sara Murphy has no position in any stocks mentioned. The Motley Fool recommends and owns shares of SolarCity and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.