Tesla shares rise after winning California utility contract

Shares in innovative US carmaker Tesla climbed on Thursday after the announcement that it had won a bid to provide a 20 megawatt energy grid to Southern California Edison.

Tesla will provide the "powerpacks" to the grid to avoid power shortages, focusing on the replacement fossil fuels for electricity generation with lithium-ion batteries.

The system will have the ability to power 2,500 homes when the construction of the project is finished, which is expected to happen before the end of the year.

"The Tesla Powerpack system will reduce the need for electricity generated by natural gas and further the advancement of a resilient and modern grid," Tesla said in a blog post.

Chief executive Elon Musk has been a major advocate of clean energy, and has mapped out a long-term idea that it will become a clean energy firm. It has been one of the first producers of electric-powered cars.

Tesla rose to $202.45 in Thursday trading, having opened at $196.49.