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Liam Denning

Tesla Goes From Zero to 100 in Three Months

Wildly fluctuating greenhouse-gas credits play a big role in its earnings.
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Photographer: David Paul Morris

Tesla went from zero to 100 in three months -- which, granted, doesn't sound that impressive. Without it, though, the electric-car pioneer might not have beaten earnings forecasts this week.

I'm referring to zero-emission vehicle, or ZEV, credits. California and several other states require that a certain proportion of the vehicles sold by an automaker emit no greenhouse gases. These cars earn the automaker credits, and if they don't have enough to meet their quota, they can buy extra ones from someone who does. As Tesla only makes vehicles that run on batteries and emit nothing, it usually has a surplus for sale.