This is your SolarWakeup for June 11th, 2020
May Survey. Did you fill out your response for May? You can see the full results of previous surveys here
Your Listening Recommendations. In a few hours I am starting my drive cross-country. In the next 45 hours, what should I listen to in podcast or video format? Send your episode recommendations to my inbox please
Solarize My House. I got plenty of feedback yesterday about my home system, I appreciate that. So here’s the follow up question. I have space for up to 40 panels on the roof, a transfer switch and pre-plumbed for a gas generator. Obviously I want solar but do I also want a generator and battery? Or just a generator? Keep in mind that we plan for up to two weeks of no power post-hurricane and it would be an interesting concept to maximize the gas in the tank with solar/battery/generator if such a complete system that self-managed were on the market. Send your product/design suggestions and I’ll answer any follow up questions here.
All Quiet In Energy News. If you haven’t seen it, you should know that mainstream media (i.e. non trade news) have almost eliminated clean energy and solar coverage over the past month. I know that other issues are more prominent but I also worry about layoffs and reassignments of energy writers. For example, Vox has published 1 article with the word solar in it over the past month. It is also important that you get your stories out there, if you can afford it, hire a PR rep. Feel free to ask me for recommendations if you’d like but we need everyone to be out there pitching.
Nuclear Boondoggles. In case you missed it, the Georgia nuclear plant will miss deadlines and budgets once again. Regulators are surprisingly still publicly supporting the ratepayers subsidizing poor corporate execution however.
WSJ Covers Energy Market. This summed up how the market is saying that renewables work, in a tweet thread by WSJ reporter Russell Gold.
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Yann
This is your SolarWakeup for June 10th, 2020
May Survey. Transitioning to a monthly survey and looking at the entire month of May for the solar industry. This 3 minute survey will help educate those watching the market and help you see what else is going on in our industry. You can see the full results of previous surveys here and fill out your response for May here.
It’s More Than Cost. A new study published by UC Berkeley and Gridlab will be all the talk this week, mainly because the headline tells us what we want to hear. Achieving 90% renewables by 2035 will be cheaper than where we are today. Here are some things to consider that would strengthen and also render it more complicated. While it’s easy to take large scale solar RFP results and extrapolate, it will take an entire system of generation to make it work for the new way of consumption. EVs and home offices will change energy usage across the system. The study is very likely underestimating the speed and depth of cost declines for energy storage, both distributed and large scale.
Fight For Electrification. Electrification of everything is the trend of the decade and if any of you still use a gas stove, you’re missing out on the joys of induction. As I move to my home in Florida, where I designed for hurricane prep, I installed a full home transfer switch for a backup system and a large gas tank to power the likely generator. The only other item I use the gas for is the instant hot water heater because 80A draw for an electric instant hot wasn’t in the cards. I’ll be back with you for advice on solar/batter/generator design and product selection soon. What do you use gas for?
Holding CA On Aliso. Speaking of gas, Governor Newsom wanted Aliso Canyon’s usage to come to a halt but since the environmental disaster a few years ago, the site is producing more than before. It may have faded into the background but activists should hold the Governor on his promise.
Presented by Adani Green Energy. Adani is a fully integrated renewables company, from solar cell and module manufacturing to ownership and operation. The company has a top global operating and contracted pipeline of over 14 GW. Adani is the recipient of the largest solar award ever of 8 GW, which includes a single site project of 2 GW - tied for the world's largest. No one knows mega-scale projects like Adani.
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Yann
This is your SolarWakeup for June 9th, 2020
May Survey. Transitioning to a monthly survey and looking at the entire month of May for the solar industry. This 3 minute survey will help educate those watching the market and help you see what else is going on in our industry. You can see the full results of previous surveys here and fill out your response for May here.
Virtual Trade Shows And Conferences. I’ve been in solar for 15 years and I still love going to solar conferences and trade shows. Seeing new companies making their move, showing new products and most of all the reconnection with many of you. I had the pleasure of touring the virtual trade show environment that the Midwest Solar Expo will be using in a few weeks. In the video playback, you can see how you can tour the facilities, hear speakers, meet with exhibitors and have random encounters with other attendees. It’s not going to replace the in person events but it sure does a big job improving on a webinar.
Political Opportunity. Clean energy, climate change and fossil fuels are key issues that also have a big grey area. That grey area is the undecided voter segment that doesn’t know which party is better at handling that issue. Some would see that the issues also skew heavily democratic which presents an opportunity for Biden but on the other hand turns the issue into partisan topics. Partisanship in solar has been a frustrating reality given that the solar industry has gone out of its way to be bipartisan and has shown benefits to red and blue states alike.
Presented by Adani Green Energy. Adani is a fully integrated renewables company, from solar cell and module manufacturing to ownership and operation. The company has a top global operating and contracted pipeline of over 14 GW. Adani is the recipient of the largest solar award ever of 8 GW, which includes a single site project of 2 GW - tied for the world's largest. No one knows mega-scale projects like Adani.
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Yann
This is your SolarWakeup for June 8th, 2020
Emergency Powers. Presidential powers through emergency declaration can be powerful, Trump has tested these limits including reallocating defense department funding for these declarations. Last week, under this presidential power, the White House removed a tranche of environmental reviews for infrastructure work that was required to make up from the economic woes caused by the pandemic. Climate change is an emergency of the highest degree, something that this White House will not pursue but something for us to think about going forward.
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Yann
This is your SolarWakeup for June 5th, 2020
Our Industry. This week has been challenging for many, clearly more for others than for me. As a father of three young kids, I have struggled to explain what is happening and the privilege they are benefitting from when I have to take inventory of it for myself. So I have looked at you, the readers, and industry spokespersons for guidance and leadership and I’ve been happy to listen. That being said, we are at a stage of words and actions must follow. It has also been confirmed that the voices I am hearing from and reading statements from, lack diversity to say the least. We’ve all been to the trade shows and conferences and it’s not representative of America’s diversity. Solar needs to do better and I am optimistic that it will do so, I am proud however that our advocacy always includes activism for diversity and justice. If you didn’t catch Vote Solar’s statement this week, it more eloquently states what I am feeling.
The Platform. On Monday I offered this platform, which is read by most of solar, to readers that have a better perspective on racism, profiling and police brutality than I. Over the next 24 hours, I didn’t receive a single post to publish from readership and I know that is indicative of who I am reaching. I have always wanted SolarWakeup to be a platform that shares it’s reach with the readers, to expand the viewpoints and lived experiences but that requires that I expand the folks that I am reaching.
Germany Will Do It Again. When it comes to scaling solar, Germany was way ahead of the entire world. Now, post-COVID, Germany is expanding subsidies for electric vehicle adopters to ~$6,700 and a reduction of 3% from the sales tax paid. This will increase the total units sold in Germany and lower the cost for the rest of the world. While the US and other Countries have been ahead on this, it is also significant given the German heritage in auto manufacturing. I find EV adoption relevant for solar from two perspectives. First, it increases the total consumption of electricity especially for consumers that think about what type of fuel is powering their car. Second, the batteries used in the cars are also used in our homes, buildings and solar farms. Lowering that cost will pay dividends in our sector for a long time to come.
Forget Societal Benefits. Trump is taking this time to make it easier to build infrastructure without environmental review. These reviews are an obstacle for solar development at times as well but you can’t take a step forward while taking two steps back. It would be best to slow the development of fossil infrastructure knowing that it will be without use a decade from now.
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Yann
This is your SolarWakeup for June 3rd, 2020
Solar Is Back, On The Record. Bloomberg is out with a bit of a recap of the last 90 days in solar from the viewpoint of Sunnova and Palmetto, two companies that you know well and have a good macro view of the solar market. Sunnova was out early with confirmation of its public guidance, the first public company to do so. I expect other public companies to reaffirm 2020 numbers over the next few months as well, much of the underlying data tells us that homeowner interest in solar is higher than ever before and positive economic cases exist in more geographies than ever. While the volume will return, now is the time to focus on margins and make sure they are distributed evenly throughout the value chain. The solar product pricing index for May is now open for installers to submit data and expands beyond modules. With dozens of installers submitting information, they have already seen the ability to negotiate more fair pricing for their purchases.
Loan Markets Agree. Loanpal issued their latest securitization reports through Kroll Bond Rating Agency (KBRA) for about $400million in loans. Two data points that are of interest and reassure the market sentiment. First, commentary is made that while the latter half of March was down in volume, the company is now above pre-COVID levels. Second, a graph showing new originations shows March 2020 as the all time high, crossing $200million in loans in that month for the first time. Sunlight Financial also announced an expansion of its facility with Tech CU to finance over 80,000 solar homes, which equates to over $2billion in commitments.
Vivint Solar’s Double Capital. Not to be outdone, Vivint Solar filed two new financing arrangements. The first is basically a sale of future equity cash flows of their assets. In a deal with Brookfield Asset Management, Vivint Solar monetized a forward strip of revenue to the tune of $200million out of a possible $300million in the facility. The company also increased its warehouse revolver by $245million to $570million. Interest rates are looking quite aggressive as well.
Like I Was Saying. If you listened to SolarWakeup podcast 4 weeks ago, I made a prediction well before it was cool to say this. I said that 2020 is not going to be a down year compared to 2019. Hear that clip here and subscribe to the podcast.
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Yann
This is your SolarWakeup for June 2nd, 2020
My Thoughts. We are all going through the same things right now but all with different perspectives. My point of view is not what I want to hear from so I’ve spent time listening to people I respect with the reality that I would like you to have more diverse points of view as well. While I have the luxury of a voice and a big platform right now, I would rather that platform be used to amplify voices from folks that look different than me and experienced life coming from another set of circumstances. So I would like you, or those around you, to share your opinion with this platform. It can come from you individually, your colleague or even a group of you. I look forward to sharing your thoughts with the rest of the solar industry.
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Yann
This is your SolarWakeup for June 1st, 2020
Liftoff In Florida. If you’re anything like me you thoroughly enjoyed and delighted in the SpaceX Demo-2 Dragon launch from Cape Canaveral in Florida this weekend. This included staying up most of the night and watching the crewed capsule approach, dock and equalize with the International Space Station. Whether you are 38 or 3 years old like my youngest, rockets taking off for outer space brings a smile to your face. It all seems too big and too impossible (I still don’t know how they land the rocket on a drone ship) but the combined capability of humans can really do anything.
A Uniquely Terrible Business Model. National Grid published its interconnection study results for 300MW of distributed solar last week. In order to get 90MW of that capacity built, developers would have to pay $75million dollars and wait 5 to 7 years in order to get the upgrades done. This should be part of the obituary of that business, there is nothing to be said about telling customers to wait 5 years to get an upgrade done and have to pay almost $1 per watt to get it. If the infrastructure can’t handle 300MW of solar, the system needs to be rebuilt and I’ve seen most of the infrastructure in Florida rebuilt in a couple months after a hurricane.
China, Modules and More. In China, the government is imposing new restrictions on manufacturing expansion given the delay in demand globally. In the US this means that prices are dropping and catching up to the market that is coming back nicely. Over the past few months, some of you have benefitted from the Solar Module Index which publishes the April numbers this week. The module index will expand into the product index and all installers to add other parts you are buying like inverters and racking per your request. This is data that comes directly from installers and shared with each other, I only play the role to consolidate the data. For the foreseeable future, I am also making the index free to get the margin back in line for installers that are suffering from covid related slow down.
The Margin Stack. I am writing a full blog post on the topic of margin stacking because the overall cost of solar to the homeowner is much higher than it should be and the margin that the installer receives is not reflective of it. Soft costs are a problem but more than a third of the price of solar for a homeowner is neither product, labor or installer profit. More to come.
Big Picture Matters. I am glad to see that solar has for a long time and will continue to view our industry as more than just a market to product clean energy. Without getting into topics much bigger than this newsletter, I now understand more deeply why caring about the big picture matters, access for everyone matters, more diversity matters and ensuring equality matters.
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Yann
This is your SolarWakeup for May 29th, 2020
Per Capita Solar. Solar isn’t always where we think it is. A lot of it is installed in very large cities like Los Angeles and San Diego but when adjusted for population, it could be a lot better. How does your city show on this list?
The Real Pressure in Oil. There is a lot of talk about divesting endowments and pushing major climate goals for the oil majors. In reality, there are hundreds of oil companies in exploration, drilling, pipeline and more that are backed or owned by private equity. Most PE firms will have 20 oil companies for a clean energy investment and that is the real pivot that needs to happen. This isn’t a climate statement, the market is adjusting its goals of where the returns and capital preservation are maximized.
Top Modules Rated. PVEL, whose CEO visited with us on a podcast last year, is out with its annual module reliability scorecard. How does your module stack up and to what extent is your business aligned with a module supplier?
Mailbag Podcast. Send in your topics for next week’s podcast. I’ll be answering your questions about solar, the market or any other things that interest you. Have a great weekend!
Presented By Suntuity. Do you sell solar and see an opportunity to expand the markets you serve in a digital sales environment? Suntuity is expanding its salesforce and looking for more sales leaders to join their growing team. Based in New Jersey and servicing over a dozen States, joining Suntuity could be the sales boost you need. Learn more about our company today.
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Yann
This is your SolarWakeup for May 28th, 2020
Commercial Solar In Trouble. Financing rooftop solar for commercial customers is going to be more complicated than ever before. Putting most companies through a pandemic risk assessment increases the return requirement in a market already tough to make the financials work. This is going to drive more developers to either propose cash purchases as opposed to financing where a third party owns the solar asset. The tax code was amended to allow for the depreciation losses to go back 5 years but this market desperately needs a grant in lieu to kick start again. How the community solar or virtual PPA market adopts these customers will be interesting.
EVs Are Better (And Cheaper). Anyone that has driven an electric car knows that it’s a better driving experience. Even car companies have accepted this and adopting full product lines in this decade. EVs will nationalize once a cultural icon like the F-150 gets an electric version and fleets actually roll out large scale implementation. How regulators and utilities execute on this will be important especially as the market seems to be trending towards utility ownership of charging stations. The best part in this new data set, EVs are drastically cheaper assets to own as well.
Southern Co Wants Headlines. I’d like to fast forward to every utility announcing a 100% clean by 2050 goal. With every coal asset or older power plant to be first moved to a gas investment and then magically by 2050 it will all be renewable. The issue with the headlines and details isn’t the goal, it’s that none of the executives in the board room today will be there in 30 years and the goal doesn’t impact this quarters financial performance. Until the incentive of rate basing a new gas plant next year is removed and replaced by building a better solar plus storage asset, we will get more lofty goals with short term gas power plants being built.
Podcast Mailbag. Make sure you catch my podcast about the 30 million solar roof idea by John Farrell. The podcast is now available on spotify as well as other streaming platforms. Next week’s episode will be a mailbag where I talk about the headlines and answer your questions, send over topics you want me to cover.
Act On FERC. During the coronavirus pandemic, a small shadowy association just launched an unprecedented attack on our solar rights, and we need your help to stop it. This secretive group is trying to end the fundamental, state-based solar energy policy of net metering that allows solar users to earn fair credit for the surplus electricity their solar panels produce. The deadline to stop this attack is in just a few weeks. Tell the Federal Energy Regulatory Commission to immediately reject this destructive and dangerous attack on your solar rights! Thank you for lending your voice to this important issue during this challenging time. If you want more details on the petition before FERC, click here or join Vote Solar on a webinar on May 28th at 3pm MT.
Presented By Suntuity. Do you sell solar and see an opportunity to expand the markets you serve in a digital sales environment? Suntuity is expanding its salesforce and looking for more sales leaders to join their growing team. Based in New Jersey and servicing over a dozen States, joining Suntuity could be the sales boost you need. Learn more about our company today.
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Yann