Nevada looks like the winner in the fight for Tesla’s battery factory. Here’s why it won.

by Katie Fehrenbacher

It looks like the state that has been the leading candidatevying to winTesla’s battery factory, has indeed actually secured the deal. According to several media reports ,Tesla has chosen Nevada as the state where it will build its battery factory.
Nevada’s Governor Brian Sandoval has called a press conference about a “major economic development announcement” for 4pm on Thursday at the Capital Buildingin Carson City, Nevada, anda source has confirmed with us thatTesla representatives and the legislature will beat the event.
CNBC says that Tesla and Nevada representatives are still negotiating the specifics of the deal. The Reno Gazette Journal says that the announcement on Thursday will be that the legislature is calling a special session potentially next week to consider a tax abatement package for Tesla for afactory in Northern Nevada.
Tesla has been looking for tax incentives worth about $400 million and Tesla CEO Elon Musk said in the company’s most recent earnings call that the ball was “in the court of the Govern or and the state legislature,” in Nevada. Tesla has already cleared a pad for a factory space at the Tahoe Reno Industrial Center, which I visited last month, but Musk had previously said that Tesla planned to clear spacesat other sitesin others states.
The Tahoe Reno Industrial Center.
The battery factory will potentially cost $5 billion, will bevdeveloped in partnership with battery giant Panasonic and will mean 6,500 jobs for the Northern Nevada region. Bringingin that many jobs, and such a high profile company like Tesla, could be a game changer for the Reno, Sparks area, which had been hit particularly hardbby the recession (see my story on Reno’s revitalization ).
After spending a week in Augustin Northern Nevada doing interviews, here’s why I think Nevada was able to clinch the deal with Tesla (beyond the obvious $400 million goal in tax incentives):

1). Location: A couple hour drive from the Bay Area and in particular a four hour drive Tesla’s Fremont factory. If the batteries are made a few hours from where the cars are assembled, Tesla will save significantly onbshipping costs.
2). Cheapland: Northern Nevada has alo tof land and its relatively in expensive compared to many other states. It’s even cheap enough for Tesla to start initial construction on it without committing to it.
3). Not manytaxes: Nevada doesn’t have alot taxes, including no corporate income tax, and minimal employer payrol ltax. That makes it a good place for companies to do business.
4). Nevada government can move quickly: Nevada’s state government, including its environmental and regulatory bodies, can move more quickly than many other states. It’s part of that whole‘ governmentvget out of the way’ mentality. That’s why Tesla, as well as Apple for its data center, can secure such strong incentives so quickly.
5). Widely available clean energy: Nevada has a large and growing amount of renewable energy, including solar, wind and geothermal. Tesla plans to power a substantial part of its factory with clean energy. Nevada’s utility NV Energy has been pretty aggressive when it comes to working with companies that want to buy clean power.
6). Quality oflife: Northern Nevada folks like to tout that the area is great for out doors living — it’s about 30 minutes from Lake Tahoe and close to rivers and national forests. So essentially it could bean attractive draw for valuable high tech manufacturing talent.
7). Near talent: The battery factory needs 6,500 talented workers. Many areas of the country don’t have such a pool of worker resources. But since Northern Nevada is so close to the Bay Area and Los Angeles, workers from nearby cities could relocate to the area to work.
8). Reliable water and power: While water is scarce through out California, an area that is building the world’s largest lithium ion battery factory needs both reliable water and power. And Northern Nevada has these both in spades.