Social Capital Chief Executive Chamath Palihapitiya told CNBC on Thursday that Tesla's growth is much more than about electric cars: its renewable energy components could make Elon Musk’s company worth trillions.

“It is the leading hedge when it comes to electrification and decarbonization. This is no longer about cars, that’s the first wave of growth. I think people are pricing in the evisceration of traditional autos and an enormous shift to [electric vehicles], of which Tesla will get the disproportionate share,” the Sri Lanka-born Palihapitiya said in a “Squawk Box” interview. “This is worth trillions of dollars.”

Tesla has been on a tear. A year ago, Tesla’s shares were trading around US$260. Now, they’re above US$1,500. Earlier this month, Tesla became the world’s most valuable automaker when its market cap surpassed Toyota’s for the first time. On July 1, Tesla had a market cap of $206.5 billion compared with Toyota’s US$202 billion. As of Thursday morning, Tesla’s market cap is US$295.3 billion.

The company also just reported its first full year of profitability on a GAAP basis.

Tesla’s energy businesses so far have taken a back seat when compared with its key autos unit, but Musk has been pushing toward growth. In its second-quarter earnings report, Tesla said its energy storage business Megapack generated a profit for the first time.

“What Tesla is going to do with their battery packs and software will all of a sudden allow each of us to be in the energy business, as well,” Palihapitiya said.

“Again, people will get angry, they will not understand, they will try to push back, and they will be wrong. And what’s going to happen is this stock is now going to represent the totality around decarbonization and sustainability, so it was really great to own this thing around cars for the first few years, I get it. But now I underwrite this stock as a push toward decarbonization, towards unregulated energy, and towards the ability for all of us to become our little micro utilities.”

Chamath Palihapitiya, the Sri Lanka-born chairman of Virgin Galactic and founder of Social Capital.He says Tesla stock is now going to represent the totality around decarbonization and sustainability.

Chamath Palihapitiya says Tesla’s renewable energy push could make it worth trillions