Feb 12, 2021 - Economy & Business

Tesla faces scrutiny over carbon costs of bitcoin and vehicle range

a tesla logo with people standing around it
Illustration: Sarah Grillo/Axios

Tesla is riding high these days, but two developments could create reputational risks for the world's most valuable car company.

Driving the news: Tesla is beginning to face criticism over the climate effects of its big new investment in bitcoin and the decision to accept it as payment — even though electric vehicles are lower-CO2 alternatives to gasoline vehicles.

Why it matters: Bitcoin "mining" to process transactions is very energy-intensive, so promotion of its use could add to its carbon footprint.

What they're saying: Ben Dear, CEO of the sustainable investment firm Osmosis Investment Management, tells Reuters: “We are of course very concerned about the level of carbon dioxide emissions generated from bitcoin mining.”

  • He said Tesla should disclose energy consumption associated with its bitcoin ventures.
  • More broadly, some analysts see Tesla's decision to accept bitcoin as potentially widening its use in transactions more broadly.
  • Reuters says Tesla's bitcoin backing could "turbo-charge global use of a currency."
  • The Verge is also reporting on the climate angle.

Driving the news, part 2: New research from Edmunds finds that five Tesla models they tested showed less range per charge than the vehicles' EPA estimates.

  • The analysis, which Edmunds notes is designed as a "real-world complement to the EPA's laboratory-based process," found the vehicles had 2.5%-17.4% less range.
  • The one with 17.4% less was a 2018 Model 3 Performance edition, which had 256 miles of range instead of 310 in the EPA estimate.

But, but, but: Tesla still had two of the five longest-range vehicles among the 15 models Edmunds tested.

  • The biggest difference between the EPA and Edmunds findings was with the 2020 Porsche Taycan 4S, which went 59% further in the Edmunds test at 323 miles.

Of note: Gasoline-powered vehicles can also underperform their EPA estimates, and in general, mileage and range are influenced by all sorts of conditions and driving styles.

The bottom line: Tesla's on a good run, having become consistently profitable. But the EV market is getting more competitive, so these topics are worth keeping an eye on.

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