I will be boarding my flight to Chicago shortly and want to thank the incredible SolarWakeup family for making this another fantastic event. After the day of conversations, we will be much more knowledgeable about the solar market in Illinois and how to make some money and create lots of change. See you there!
Getting Into Permitting With Abby Hopper. Frank ‘sits’ down with Abby Hopper of SEIA and discusses the idea of creating more efficiency in the permitting process. It’s great to see the leadership from SEIA have a focus on this issue which is not a defensive policy agenda item. Well worth the 3 minutes to read through and hope you tell SEIA that you appreciate their involvement on this.
A Downgrade For Utilities. Moody’s is raising a red flag. We’ve talked about how big utilities have gotten over the recent years and much of that is financed with access to really cheap debt through corporate bonds. Those bonds are really low coupons, many of the big IOUs have interest rates below 4% for long term capital mainly due to the security offered by the regulated service areas and the associated rate base. Those bonds are trading below par which is not a good thing in a capital market where rates are rising. Lay regulatory uncertainty over that risk and things could get ugly. Keep watching this space.
Mainstream Media Catches On. There is a risk to our short term energy policy surrounded by the starts and stops caused by some State legislatures. The risk is that investors lose confidence in companies and cause the liquidation to occur or sell the company prematurely to someone that sees a longer term vision. Of course, there are other aspects of this that differentiate the US and China but having a longer time horizon is definitely one of them. Now that solar panels are basically double the price than they could be, the US could do a reset and remove the tariffs and duties and double down on the energy transition.
Houston’s Solar Ecosystem. It’s interesting to speak with energy companies in the Houston ecosystem about solar and storage these days. Houston made its mark prospecting and playing the upside which is exactly the vision for solar in the next iteration. Bidding a $25/MWh solar PPA for 20 years is fine, it finances easily and requires tight operations. But there is no upside and little ability to play the spread in a sale. Solar with storage operated in a competitive market, that’s what I’m talking about and Houston gets that, check out the Chronicle’s coverage.

Have a great day!

News

 

Have a great day!
Yann

By Frank Andorka, Senior Correspondent

By Frank Andorka, Senior Correspondent

At the beginning of June, the Solar Energy Industries Association (SEIA) co-hosted a meeting in San Francisco, the purpose of which was to find ways to reduce extra costs associated with going solar. These costs, known as soft costs, include the cost of permitting, inspections, customer acquisition and other issues. SolarWakeup caught up with SEIA's President and CEO Abigail Ross Hopper to discuss how the meeting went and what the next steps will be. SolarWakeup: What was the purpose of this first meeting? Abigail Ross Hopper (ARH): This was an introductory meeting, and as such, we think we did a nice job of laying the issues on the table. The next step broadly will be to identify concrete solutions, and determine specifically what it’s going to take to dramatically reduce soft costs. We see this as both a real and a critically important opportunity for the industry. SWup: Why is the issue of permitting so important to the industry? ARH: The process to design, permit, inspect and interconnect is much more burdensome in the United States than it is in other developed economies. Inconsistent interpretations of the rules (which can be national, regional, and local) from jurisdiction to jurisdiction makes the process inefficient and costly for both solar companies and permitting offices while also leading to customer frustration during a lengthy permitting process. That customer frustration can lead to contract cancelation, meaning all the time and money spent on such customers is lost and must be made up on systems that are completed. All in all, this contributes to a typical residential PV system in the U.S. costing about twice as much as a typical system in Australia. The current permitting and inspection process exists to ensure the safe installation of the system but there is a better, more effective way. SWup: How can the industry participate? ARH: Several organizations and companies, including Sunrun, Mosaic, SEIA and The Solar Foundation (TSF), are co-leading an effort, in collaboration with other companies and organizations, to develop a plan to thoughtfully streamline the process in the U.S. while maintaining high safety and quality of work standards. SEIA will build on the expertise and success of its Codes & Standards work and TSF will build off the work of its SolSmart program. Industry can participate and shape the campaign by joining SEIA and learning about and espousing to cities the successes of SolSmart. SWup: What conclusions were reached at the meeting? ARH: The participants are continuing discussions to develop and finalize an aggressive plan of action. Organizations and companies have seen a clear need to address this problem and have made commitments to work on this to reduce soft costs. More details to come soon. SWup: What affect do you see these discussions having on the segment? ARH: This is about making solar more affordable. More affordable means more accessible to more Americans and businesses. Cutting deadweight loss and unnecessary steps and costs benefit everyone. SWup: What is the next step? ARH: We’re continuing to build the coalition and assess what it is going to take to do this right. But real support in resources and funding from the industry will be crucial. SWup: What policy prescriptions at the federal or state level can help move the needle on this? ARH: This issue does not fall neatly into federal or state policy lines but there are opportunities to engage at national, state and local levels. All will be necessary in the end. For more background on the permitting initiative outlined by Abby, you can catch Yann's interview with Andrew Birch