Monday morning Tesla Motors (TSLA) announced that it completed the acquisition of solar panel installer SolarCity (SCTY) for $2.6 billion. Elon Musk, founder of Tesla and co-founder of SolarCity, spearheaded the deal. He has a 22% ownership stake in each company.
Tesla Motors could become the most disruptive force in both the energy and automotive industries since hydraulic fracturing for natural gas or Henry Ford's assembly line. It may not happen soon, but Tesla is building momentum.
In Tuesday trading, Tesla shares rose 3.6%, while SolarCity's stock price was flat.
It's now the first company of its kind and the acquisition is part of Musk's plan to create a fleet of cars powered entirely by renewable means. This plan is another step in Musk's ambition to drive demand for lithium-ion batteries that are being produced in Tesla's Nevada-based Gigafactory.
Musk said that solar power will be the "single largest source of electricity generation" by 2050. At the forefront of that movement are the two most ubiquitous brands in the renewable energy revolution, Tesla and SolarCity. That brand awareness will be a boon for Musk's companies.
Separately, waning electricity demand has many utilities investigating the possibility of new revenue streams from electric vehicle charging stations.