This is your SolarWakeup for April 23rd, 2019
Get That Money. PG&E has filed a normal request with a strange twist at the CPUC. It is asking for a raise for its shareholder return, which is typical, but it’s asking for a raise of over 50% to 16% from 10.25%. Shockingly, and coincidentally, SCE and SDG&E also asked for massive increases to the ROE. I’m still taken aback by the unprecedented ask and can’t help but wonder what legislators are thinking, especially if they’re thinking if there is a better way. The CCAs around the State and utility execs in other States must be in shock by the ask as well, what could possibly warrant a high double digit return for shareholders of a monopoly? What would regulators say if solar came to the table and said we want guaranteed revenue streams at the same ROE as utility shareholders?
In Awe Of the Flaw. Energy Twitter went bananas yesterday for a report from the University of Chicago. The report that is on the way to be peer reviewed has a big headline, RPS policies are very expensive climate policies that are far more costly than carbon taxes. Without going into the details and analysis methodology, do expect more of this report to be discussed and rebutted in the media. I bet that the anti renewables folks will be using this unfortunately to make the case against solar and wind.
But Wait, There’s More. When solar isn’t breaking records or wind is causing negative energy rates, they are causing massive savings to the system. In the latest Duke procurement, the generation will save consumers $375million over the 20 years. I’ll take facts over headlines any day I guess.
Nevada Steps Up. It didn’t take long, Governor Sisolak has signed the 50% RPS, 100% carbon free bill that passed the Legislature. This is the month of 100% clean energy policies, maybe Florida will follow right behind?
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Yann
This is your SolarWakeup for April 22nd, 2019
Two More Pods. Find my conversation with Mary Barber of the Environmental Defense Fund and a discussion on development of solar projects in New Jersey. If you haven’t subscribed to SolarWakeup’s Podcast, I’d appreciate you trying it as we continue to grow this platform. Our interviews from Boston will start populating over the next few weeks, make sure to catch them as soon as they get out.
VDERs Redefined, Applauded. The NY PSC came out with major updates to the VDERs that enable more solar to get done in New York State. Some of the updates include the revision on the valuation for solar generation and provisions that enable more community solar to get done. It also increases net metering to 750kW to get more commercial properties to install on site generation.
Nevada Goes The Distance. Last week we applauded the NV Senate for passing the expansion of the RPS and now we will do the same for the NV Assembly. This is the next step in a long process for Nevada to do the will of the people. The Governor is expected to sign the legislation before it goes back to the voters.
The Climate Mentality. There has been a 50% growth in people thinking that climate change will cause harm to them personally since 2008. 73% of respondents to the poll said that it will cause harm to future generations. Put this into context that we now know that part of the 2016 rhetoric from outside functions was to divide Americans with coal. This means that it’s okay to talk about jobs and economic opportunity at the same time as climate policy. It will now take proper talking points to explain that energy sectors like solar are inherently tied to policy, innovation alone will not do the trick.
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Yann
This is your SolarWakeup for April 19th, 2019
Have a great weekend! New pod out later today.
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Yann
This is your SolarWakeup for April 18th, 2019
A Development Podcast. Check out the new episode of SolarWakeup Podcast with solar developer, Jim Spano, in which we talk about all things solar in New Jersey as well as his new venture to bring REIT capital to solar.
Climate At Fox News. Senator Sanders held a town hall on Fox News and did two things we talk about a lot. When asked about national security he pivoted the answer to include climate change and terrorism in the Middle East, a clear signal that he was speaking to the audience of Fox News. Second, as the article says, “Sanders drew cheers when he said transitioning to renewable energy would create millions of new jobs.”
Duke And Solar. Duke is going to add a lot of solar in North Carolina including projects that it self developed. Now to the residential market, maybe we can do more there in the Carolinas including South Carolina!
Both Sides Of The House. Vistra energy is using its energy storage projects in Texas as a legislative tool in Illinois in order to keep their coal plants economical for a few more years. This transition from coal to solar+storage is interesting especially given the valuation that Vistra seems to be tying to their assets.
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Yann
This is your SolarWakeup for April 17th, 2019
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Nevada Goes For 100. Late yesterday, the Nevada Senate voted unanimously to double the RPS to 50% by 2030 and 100% carbon free electricity by 2050. Vote Solar’s Jessica Scott sent this comment after the passing, “This bold but achievable clean energy commitment will support good jobs, healthier communities and a brighter energy future for our children. We urge Assembly lawmakers to follow the lead of their Senate colleagues to pass the bill and send it to the Governor.”
A Labor Union Endorsement. The Maine version of the Green New Deal got an endorsement from the State chapter of the AFL-CIO which represents 160 unions in the State. The move and commentary is a welcome addition to the fight on climate change which usually sees solar and unions on opposite ends of the legislative fight.
Electric Fleets Financed. Proterra, the amazing company that manufacturers electric buses in the Bay area, has put together a $200million financing package to lease some 1,000 buses. The goal is that the upfront cost is less than the tradition choice. Electric demand may have been flat over the past 10 years, I don’t think (Shell sounds like they agree) that this trend will continue with fleets going electric.
On Bill Financing. This could be a big mover for financing clean energy in Hawaii, I look forward to seeing the results.
Internal Cost Allocation. Microsoft is doubling its overhead allocation to divisions for their own carbon tax. At the same time they are looking for legislators to work on this as well.
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Yann
This is your SolarWakeup for April 16th, 2019
Enphase Registers SunPower’s ENPH Shares. Last year, Enphase acquired the micro inverter business and IP from SunPower for some cash and stock while also receiving a 5 year supply agreement. (This is all in the public filings) SunPower’s shares are now registered by Enphase which means that SunPower could sell the shares if they wish.
Winning The States Though. Axios’ Amy Harder is right that Trump and Perry have tried quite a few tricks to help out nuclear energy. I would also say that State’s have done quite a bit that the DC folks would be supportive of including last week in Ohio which follows New York, New Jersey, Illinois and more. Rick Perry did head down to Georgia with over $3billion in the form of Solyndra loan guarantee dollars for the nuclear plant at Vogtle, over 6x the amount that Solyndra received.
Warren Goes Full Transition. Senator Warren has no more patience for the energy transition and is out with a public lands policy plan. The MA Senator is often out front with policy proposals and this one would halt new leases for drilling of any type while looking to increase renewable energy generation on public lands tenfold.
Inverse Condemnation. The PG&E saga’s next step happened today with the release of Governor Newsom’s Wildfire strike force plan. The 59 page document highlights the risks and costs of wildfires while also saying that something needs to happen with the financial risk caused by the natural disasters, regardless who causes them. The report also says that PG&E needs to do better and withholds an outright endorsement of the inverse condemnation which would pass the risk to consumers and taxpayers instead of shareholders. First, this is largely a reality because a regulated monopoly is almost worthless to the ecosystem without a good credit rating which at this point requires indemnity from wildfire risk. Second, with the political reality that this is bound to happen, I ask again, what is solar going to extract from this bailout of massive proportion?
Subscribe To The Pod. Make sure to go to your Apple Podcast app and subscribe to the SolarWakeup podcast and listen to the latest episode. Three new episodes are releasing this week alone and more to come!
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Yann
This is your SolarWakeup for April 15th, 2019
New Pod, Thomas Byrne. Catch today’s episode with CleanCapital’s Thomas Byrne which we recorded at SolarWakeup Live. We talk about their business focus on small(er) solar and how they are scaling that.
Join The 100 Club. Governor Inslee is getting a little bump for his media strategy with the WA legislature sending the 100% RPS bill to his desk. It is largely expected that Inslee will be signing the bill since climate change is his main issue for his presidential campaign. Personally, I’ve been waiting for a candidate to get on the debate stage and talk climate change for every question. Jobs, national security, refugee crisis, foreign policy, they all lead to climate change. Inslee isn’t at 65,000 donors yet so if you want to hear him on stage, go ahead an donate $1 to his number up.
Illinois Lottery. Did you win? Now that the block grant awards are out, what happens to the projects that didn’t get their award? Will the legislature look to act on the pipeline that is ready to build?
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Yann
This is your SolarWakeup for April 12th, 2019
Apple Pushes Suppliers. Apple is moving its suppliers to add renewable energy for at least the amount of energy used to make the parts that go to Apple. This is a great type of leadership, by creating a prerequisite to get some of the business. Other big buyers should follow their lead here. I’d be interested in knowing if Apple helps the suppliers accomplish the goals through expertise or even outsourced purchasing.
Climate Politics Should Be Non-Compromising. There is some talk this week that the Green New Deal has accomplished its goals since some fringe republicans are coming out with their ‘climate’ plans. That is total nonsense, there is no sense in debating policy in public with other legislators or negotiating non existent bills. Also, the only person that should be negotiated with is Senator McConnell. Until then, make your case to the American public.
Run On Climate. Tom Friedman of the NY Times is saying that politicians should run on climate and I agree, but so do the polls. It’s been true for awhile that climate change, clean air and clean water does really well with voters, especially independents. Even more, the pivot from jobs to solar is easy. The pivot from corporate monopolies (utilities poll terribly) to solar is easy. If you’re going to run on something, run on solar.
Corporate Access To Lower Costs. More on the Apple comment from above. How can we make the access to solar easier and more standardized for other corporations? If a supplier is looking to have solar in order to make their company stand out, what is the cheapest way for them to accomplish that?
Question For You. Yesterday I wrote about the revenue put which made me ponder something. If your current debt is coming in at 1.3 DSCR and you can buy a product that gets you closer to a 1.1 ratio, what consideration would make you reject the higher debt level?
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Yann
This is your SolarWakeup for April 11th, 2019
Stop The BS. Sometimes I don’t point out articles that are filled with bias especially when a position of influence is used to portray a motive as an opinion. First, there is no reality where solar or wind are better off without the tax credit. Second, if you think that your sponsor capital will be cheaper without the tax equity structure, don’t use it. There are some in solar that think that the ITC going away will make financing easier, those people should go sell mortgages. Others are afraid that solar asking for the ITC and not getting the extension would be a failure. I look at it more pragmatically. I want the ITC to be as close to 100% as possible. I want it to last in perpetuity if I can influence that legislation. If I were writing an article purely based on motive, I would ask for a 50% ITC with a cap of $20k. It would shave the cost of the ITC by 90% to the taxpayer and residential would thrive. Except that this market requires us all to be on the same page, creating volume for the same supply chain and creating funding for the associations that lobby for our market to exist. If you have an urge to write an opinion piece on the topic, send an email to your college roommate that promptly throws it away.
You Have To Fight, For Your Right. The California Senate passed the Solar Bill of Rights through committee by a vote of 11-0. The nice part about it is that the legislative support largely came from the homeowners that bought solar from installers. This is a proof of concept that could catapult the Solar Rights Alliance into great funding opportunities and more coverage across the Country.
Cheaper Debt Is Good. Few things get me excited as much as lower coverage ratios. Every time I see debt closings use the revenue put from kWh Analytics I think of the other things that could also make solar projects get more capital efficient.
MidWest Solar. Catch me at the upcoming Midwest Solar Expo where I’ll be sitting with State PUC Commissioner, Katie Sieben and a great conversation with an executive from Xcel Energy. I will also be attending The Energy Fair for their 30th anniversary, this will be a special interview with a great speaker we will reveal soon!
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Yann
This is your SolarWakeup for April 10th, 2019
Absent a column today, check out these great solar communications jobs. If you are hiring, send the link to the job to me and I’ll give you a shoutout.
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Yann