PACE. Many readers that have followed my career know that solving C&I solar has been a longtime problem I have wanted to fix. We, collectively as an industry, know that credit is the central problem that isn’t solved like the FICO score solves the problem in residential. That is why I am excited to be doing consulting work as an Advisor to CleanFund, the market leader of commercial PACE. Over the next few months, I’ll be back speaking to many of you about how we can all work together and fix this problem. C&I energy users represent almost 50% of the total energy consumption but when you look at the unrated commercial solar market, it’s basically zero. I see PACE doing for C&I solar what the loan did for residential. PACE isn’t what it was a few years ago, rates are competitive and the process is much more refined. More to come on this.
New Podcast. This is a reverse interview with the audience at SolarWakeup Live asking the questions. Sound from the questioners is a bit low but I hope you enjoy to hear some of the thoughts. I’ll be doing this at future events as well to make sure the folks in the room get some feedback on the current issues being debated.
Wave Elections. I talk about politicizing the issue of solar at every chance I get. Tom Steyer is apparently taking advantage of the anticipated wave election in 2018 to put renewable energy as an issue on the ballot in several States. The legislative strategy is sound, partnering with some solar trade groups to message it appropriately would be a good additional improvement also. Look at this space.
State Politics. Interesting that the VA house in a monopoly reform bill which originally passed 55-41 was put up for a revote and was essentially unanimous. I’d be curious to understand the politics of that move except to cover the few that went with the democrats on the initial vote. Let’s see how this works in other States.
Corporate PPAs. Always interesting to get more detail on how the corporate PPAs are actually structured. Mostly they are some version of contract for differences (CFDs) but this explains in greater detail on how to do this and what the financial value proposition is.
South Florida. Since many of you have asked, I will answer in aggregate. The awful shooting in Florida yesterday is close to my home but fortunately my kids are not in this school. It is sickening however and it makes any parent wonder what options they may have to keep their kids safe. I appreciate everyone’s concern.
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Yann
What: Reverse Q&A With Yann Brandt, Live From SolarWakeup Live! New York
What: Reverse Q&A With Yann Brandt, Live From SolarWakeup Live! New York
SolarWakeup View: Listen to the podcast to hear the SolarWakeup View.
Battery Thoughts. If you were in solar in 2007, email me how much you paid for your first module and what you paid for your last module. Then think about the following, nobody else was using silicon wafers and the price dropped an enormous amount. Then think about batteries for energy storage. At best, I see energy taking 10% of the global market share of the lithium ion production. Maybe you stretch the assumptions and get to 25% but transportation will take the vast majority of it. That’s the game folks, everything is going to electrify because storage costs will become nothing. Then add the speed it brings to grid operations, elimination of intermittency in generation and reduction in grid upgrades.
Innovation. I spent the last two days at the SunShot summit here in DC. First, I am glad to see that people are targeting real and imminent problems in our space in hardware, software and business model innovation. Second, they need better access to capital and ability to network within the space. Third, these startups do a terrible job in marketing. I am the easiest media platform in the industry to reach out to, thousands of you can talk to me with the click of a reply button and it almost never happens. Our industry is a rising tide that helps everyone. Some of us will sink but I am sure of the fact that if someone does well, they reinvest into the space. SolarWakeup Ventures???
Three Pronged Solar Value. At some point we will draw the picture but the solar industry is surrounded by three major trillion dollar industries. Transportation OEMs, oil & gas majors and power IPPs are all making major moves because of the electrification of transportation.
Yieldcos. Pension funds are yieldcos for the pensioners looking for their monthly retirement check. They just happen to be private and less volatile. That’s where solar assets belong because the upside is limited for a long term solar asset owner but the downside is managed properly. Yieldcos may be gone from public markets, but they are not gone, far from it.
New Pod and SolarWakeup Update. Tomorrow…
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Yann
Rate Of Change. “The rate of change is faster than the rate of change has been changing” coming from the Director of the Solar Energy Technology Office, aka SunShot. The event is private so while it’s not off the record, I will leave the rest of the event off this platform. I wanted to pass along this message because after 11 years in solar, it’s great to hear that while things feel stagnant, the rate of change is not.
Trump Budget. Budget documents are largely messaging platforms to show the priorities of an administration. There is little doubt in the process that national labs and renewable energy programs will have lower than previous budgets. While slowing programs is short sighted, I worry about the national labs because the disruption of research is hard to restart. With the Defense budget increasing and DOD’s understand of the threat posed by climate change, wouldn’t it be wise for DOD to fund the research labs?
Watch Capacity. Must like the capacity contracts in California markets, capacity contracts are the basis that allow many power plants to try and get profitable. Look at capacity contracts as the debt service coverage and dispatched energy as the profit determination. The UK held a capacity auction and 4 out of the 6 remaining coal plants failed to clear the price for the capacity auction. BNEF now sees those plants retiring within a few years.
Mainstreaming EVs. CNBC is notorious for covering the auto sector, with a full-time reporter covering the space. But as cars become electric, they are now becoming reporters of the energy market as they impact consumerism across the Country. More EVs on TV is good for solar, our markets will connect more and more.
Watch China. We are obviously not going to see drastic increases of EV subsidies in America but we need to find more ways to accelerate the adoption of electrified transportation. In comparison, China may see more than 1 million EVs sold in 2018. I look forward to seeing fleets and mass transit exchange entirely to electric drives.
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Yann