Power To The People. Now that the earnings have come in, it’s a decent prediction to say that residential solar will have its best year ever in 2019 and 2020 shows no signs of slowing down. We get a look at the market through the largest installers, where volume was strong and financial structuring was the hurdle for stock pickers but we also see the overall market strength through the lens at both Enphase and Solaredge. At the end of the day, how many homeowners would choose not having solar if given the opportunity.
Not The Pipeline. The Trump White House is scrubbing some of the regulations in the endangered species act. While some large scale solar developers will silently agree with this move, the regulatory change is meant to help pipeline companies. I wish there was a desire to build HVDC transmission with the same steadfastness as fossil fuel pipelines.
At Work Too. After you power your home with solar, make sure that your company is also getting solar either with onsite generation or through an offsite energy contract. It has never been easier for this to happen and my hope is that the markets adapt to the potential of retail choice by deregulating more markets. The choice creates competition and is helpful to our market. We are close to the future were retail energy providers and solar policy advocates are aligned in policy making.
And At School. There is an interesting question about the value of the Mayor’s commitment to renewable energy. Cities, their school districts and colleges are actually some of the largest users of electricity and more importantly have some of the best credit in the energy market. Cities across America should be opening RFPs to see what is available for them and act as quasi developers. The same is true for schools and universities, use your buying scale and credit to create markets without the need for legislation.
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Save The Planet By Making Money. It’s a fact checking day. We start with Michael Moore’s takedown of the capitalism inside the alternative energy industry. I haven’t seen the movie but I can imagine it involves a bit of wall street’s involvement in project financing, corporations buying little companies and cutting overhead, and other things that go into the world of competing with monopolies in order to save the planet. One of the takeaways is probably going to be that making money shouldn’t be the goal, but if we are going to save the planet then we need financial sustainability.
No Credit, No Future. PG&E said in its latest restructuring plan that it would not touch the existing PPAs on the solar projects. That’s great news and PG&E is spinning it as an act of goodwill. This is an act over survival. If they were to renegotiate those deals, every future solar project would increase in cost, a cost that consumers would have to pay for. PG&E would be hard pressed to explain to legislators that bankruptcy meant a more expensive path to 100% RE.
Post-PPA Assumptions. Newsflash. Every solar project has a healthy post-PPA assumption. Do you really think that those 15 year PURPA deals in North Carolina were homeruns? They were base hits even when you include the standard Ventyx price curve and added some financial engineering to them. Look at the resi lease companies, they all include some layer of lease renewals to the deal. The logic is that the interconnection continues in perpetuity and therefore the deal has long term value as long as you have site control. This isn’t new and it has always been necessary.
Wrong Target. This is how much energy storage is going to have to cost in order to get to 100% RE is the wrong analysis. They key is what adder to a solar or wind PPA do you need to create enough dispatch ability in the local network. You don’t need 24 hours of energy storage, the generating asset can’t keep those batteries full. We are already well below 2 cents per kWh to give a ton of flexibility to operators and soon we’ll be at under a penny per kWh.
Still A Problem. The San Jose CCA signed a massive solar plus storage deal, which is great to see. There is still a massive disconnect which costs time and money between solar projects and off takers. This problem is even bigger in the corporate off take world where they have to find the structure, analyze the price that they can afford and then find the solar project to match. That’s a gap that needs to be fixed.
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Presented By Solargraf. Solargraf is the software you need for your residential solar business. From layouts, payback analysis and proposals, Solargraf does it all and best of all the low monthly price includes unlimited projects. Save time and money with Solargraf and with SolarWakeup you can unlock a special offer. Give it a try today at solargraf.com/solarwakeup
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Smart Energy Week. We are just over a month out from Smart Energy Week, formerly known as SPI. This year in Salt Lake City and hotel bookings show that some of you plan on attending, would love to know if the location is making you skip this year? You may have been surprised by the change in name, just as I was, given that the companies that make this event possible represent the solar market, many of you either SEIA or state chapter members. The front lobby will be greeting visitors with a hydrogen sector (newsflash: booths still available!) while the main floor is completely booked with solar companies investing to exhibit. Even meeting rooms at the hotels are almost fully booked with solar companies at a whopping $18k for the three days! After the event, about $10million in profits will go to the organization that produces the show, SETS, which will then split it amongst its owners, SEIA and SEPA. Smart Energy Week, relabeling the solar industry, taking our money and then passing it along half of it to a (largely) utility membership. See you there!
The Co-Op Canary. Tri-State is a large entity that many co-ops across the West/Mid-West are members of and buy their energy and transmission through. Tri-State has long required that individual co-ops cap their renewable energy purchasing outside of the Tri-State relationship. Last year, when I spoke to the CEO of Connexus Energy, he told me that they were capped in renewables and could not give its membership more of what they want. Now it looks like Tri-State is realizing that the future requires that it changes and with that a large number of co-ops may become possible markets for solar and storage developers.
Resi Cost Of Capital. During yesterday’s earnings call by Sunrun, CEO Lynn Jurich highlighted the company’s achievement of the lowest cost of capital in company history. At the same time, a day before earnings, Vivint Solar enters into a $325million debt facility. Mosaic, the residential loan provider, also announced a relationship with SunTrust (soon to be BB&T) to expand their offering.
Roll The Eyes. The future of solar in Virginia is bright led by the growth of residential solar and corporate purchasing of solar from large solar farms. Dominion has a strong presence at the Capitol and is hyping its new energy storage plan. The plan is to build 4 pilot projects and study them for 5 years. Pardon me while I yawn at the idea that Virginia should study batteries for 5 years.
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