This is your SolarWakeup for June 21st, 2018

Welcome to SolarWakeup Live! Chicago Day. A great crowd of SolarWakeup readers are coming together to hear about the Illinois market and some of the market players that are putting money in play here. Thanks to all for the support. Make sure to subscribe to the SolarWakeup podcast on your Apple Podcast or favorite podcast app to catch the content when we release it.
Raising The Cost Of Solar. Much ado about nothing but let’s give you the insight. Jinko was first to announce a US plant after the 201 tariffs were finalized. With a small exemption cap for cell imports, it seems reasonable that Jinko would use the lowest cost of supply chain to feed the module plant in Jacksonville. Now that the cells from China have a new tariff (in addition to 201) Jinko has had to pivot to their Malaysian supply chain. All this does is increase the cost of modules made in the US. Why would we want that? Why wouldn’t we want US made modules to be as consumer friendly as possible?
Updating MA SMART. If you are paying attention to the MA process, it appears that the fight continues to center around the same issues. When I interviewed the SMART rules experts on Halloween last year, we had the same issues and the DPU still has not finalized the SMART regulations. It also appears that a bill that cleared the Senate last week is lacking momentum in the State House. I hope MA can come together on the issue of solar in the very near future.
Global Solar Modules. Back to the topic of increasing the cost of solar. Now that SQN has basically outlined the strategy to be a cell supplier to US module manufacturing and SunPower has acquired Solarworld USA, what are we really getting for 201 tariffs. A tariff that pays into the Treasury instead of creating pools of capital to drive more US assembly. At the end of the day, with the trade war continuing, we end up with modules at twice the price than they should be. What’s going on with a settlement around the AD/CVD and potentially the 201? Can we get somewhere now that we see how the market responds?

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Have a great day!
Yann

Jinko To Reuters: Our Jacksonville Factory Is Still On Track

By Frank Andorka, Senior Correspondent Jinko Solar, being a public company, has to be as positive as possible. So when Reuters asked the Chinese module manufacturer whether the new round of tariffs imposed by the Trump Administration – 25% on modules and cells on top of the 30% the administration already imposed on all imported cells – my old friend Jeff Juger had a ready answer. He told the news service that the Jacksonville factory, which was originally supposed to double as the company’s U.S. headquarters, will be producing modules by the fourth quarter based on cells manufactured in Malaysia, … Read More →

Nevada Ballot Initiative To Increase RPS Appears To Be Headed To Voters, Reports Say

By Frank Andorka, Senior Correspondent A report from the Reno Gazette Journal brings the heartening news that the Tom Steyer backed Nevada ballot initiative to bring Nevada’s RPS to 50% by 2030 likely has enough signatures to go to voters. As of Monday, organizers told the paper they had nearly double the number of signatures necessary to put the initiative on the ballot. Typically, ballot initiatives need to have at least double the actual number of signatures to account for ineligible signatures being thrown out by the certification body. The measure, backed by liberal billionaire Tom Steyer, would amend the … Read More →

This is your SolarWakeup for June 20th, 2018

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.

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Have a great day!
Yann

Why Solar Permitting Matters And What You Can Do To Help: A Discussion With SEIA’s Abigail Ross Hopper

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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, … Read More →

Iowa Utility Could Be First To Reach 100% Renewables By 2021

By Frank Andorka, Senior Correspondent Under the radar, something happened last week that could send shockwaves through the renewables’ industry – in a good way. MidAmerican Energy, a division of Berkshire Hathaway Energy (Warren Buffet’s joint), filed an application with the Iowa Utilities Board (IUB) to establish ratemaking principles for a 591 MW. By itself, the application is unremarkable, but as usual, it’s the details that make this deal stand out. If approved, the wind farm would allow MidAmerican to become the first utility in the country to be powered 100% by renewables in just three years. by 2021 to … Read More →

This is your SolarWakeup for June 19th, 2018

Vistra Owns Gas and Coal, Buys Big Storage. Yesterday, word went out that Vistra Energy selected FlexGen for its first energy storage plant. The 10MW / 42MWh system is being added to the Upton 2 Solar Farm, which is located in Texas and has a capacity of 180MW. You’ve heard about FlexGen here on SolarWakeup, as I interviewed their CEO, Josh Prueher, on SolarWakeup Live! a few months ago. Vistra has been in the news because it bought Dynegy and owns 41GW of power across the Country and has in recent times announced the closure of over 4GW of coal. This project is the largest in Texas but I expect this to be surpassed even by itself. Definitely a big win for FlexGen, a longtime supporter of this publication.
What Does This Mean? Let’s hear it directly from the Vistra CEO who spoke to CNBC’s Jim Cramer a few months ago and said that coal will not have a renaissance and the cost of storage is dropping dramatically. This was at the same time that the company was building the Upton 2 solar farm but had not finalized the storage project which now makes financial sense for the shareholders investing in the project. My continued expectation is that storage has the ability to turn renewables into the replacement for power plants we need to get to 100% renewables.
Vistra Sees More Storage In CA and NY. What if, Vistra’s portfolio is replaced by storage? I don’t mean around the edges but MW for MW of capacity. I know this is a hypothetical but if you read the expectations from the Vistra investor’s day presentation, you see that they expect big storage in CA and NY in particular. For example, Dynegy has a couple of power plants in California in load centers near the Bay Area, including Oakland which was a particular focus in the last PG&E storage RFP. That’s 165MW of oil generation replaced by energy storage without generation that could come from faraway solar. You can see the GWh of storage adding up really quickly.
Picking Winners And Losers May Not Work. With an economic policy that looks to pick winners from a previous decade, it looks like the market is saying they don’t care. Even coal operators are shrugging their shoulders at the efforts to save power plants through emergency measures.
Will I See You In Chicago? We’re starting the day with the director of the Illinois Power Agency which recently set the subsidy levels for low income, community solar and C&I solar and working our way through discussions with policy and market experts. No matter what market segment you work in, come join the crowd to get your networking and dealmaking skills on. solarwakeuplive.com for tickets. See you Thursday!

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Have a great day!
Yann

Senate Should Reject Fossil Fuel Hawk for Renewable Energy Office

By Frank Andorka, Senior Correspondent I can’t lie: I’d completely forgotten about poor ol’ Dan Simmons. In a previous engagement, I’d written about Simmons when President Donald J. Trump appointed him as the interim head of Office of Energy Efficiency and Renewable Energy (EERE), a post in which he’s served ever since. And I must admit the reason he’s fallen off my radar is that he hasn’t done anything so horrific as to raise red flags. The EERE budget battles have raged on, with one side trying to slash the budget to the bone while Congress keeps reattaching the meat, … Read More →

IPPs Are Starting To Bet Heavily On The Solar + Storage Game

By Frank Andorka, Senior Correspondent It’s easy to get caught up in a solar + storage discussion that only focuses on batteries – but as independent power producers (IPPs) begin to realize how important solar + storage is going to be in their market, they are quickly realizing the question is far more complex than it seems on the surface. IPPs like Vistra, for example, just signed a deal with FlexGen, an innovative storage provider that is focusing on adding storage to C&I and utility-scale projects, to design and integrate a 10-megawatt/42-megawatt hour FlexGen energy storage system (ESS) at Upton … Read More →

This is your SolarWakeup for June 18th, 2018

This is a big week in SolarWakeup, our first full day SolarWakeup Live! event in Chicago is on Thursday. I’m excited about the solar market these days and even though there are challenges, we have markets like Illinois to look forward to. I’d love to see you there, get your ticket at solarwakeuplive.com
Another Tariff. Solar Silence. On Friday the Trump White House added another layer of costs on solar by imposing 25% tariffs on cells and modules from China. The impact is minimal on the face of it because AD/CVD already caused much of the supply chain to be out of China. This reality is more complicated after the 201 tariffs and several manufacturers planning on building module plants in the US. Those plants are now in jeopardy because they essentially lost access to the Chinese supply chain of cells. My question, as usual, is who wanted solar on the list of tariffs given that we were just on the tariff list? Where was the industry’s lobbying efforts and quite frankly it’s time to change our lobbyists because I see this as 0 for 4 in the tariff fights. The silence is deafening indeed.
IPP Deals Show New Grid Resilience. Tomorrow, a lot more on this topic but let me give you a highlight. The past decade has been about intermittent solar being added to the grid. First, there isn’t enough solar to matter. Second, we have to limit the amount of solar and charge them for the grid services. Third, we have stop letter solar connect because the caps have been hit. Now we are going to see a fundamental shift of solar being the solution to grid services with energy storage. I have said this publicly, we are less than a decade away from every solar installation having energy storage on it and even retrofitting most of the solar plants that are already operating.
Energy Subsidies. Solar will stop fighting for its subsidies when the energy sector and monopolies give up their subsidies which are much bigger and more effective than solar’s.
Solar Fires, A Big Story? My question to you. Are these stories coverage of events or worthy of a discussion?
PACE In PA. Frank has a great story about one of my favorite markets within solar, PACE. PACE was one of the fastest growing legislative movements in the 2010 era and since then has tried to find its place. I think we are really close to that reality coming true because PACE is now pricing below the cost of debt with longer terms for many solar projects. It also has the potential to open up the C&I markets by removing the credit barrier for DG PPAs. Great for the PA solar market to get this moving in the right direction. Make sure to click on the CleanFund link below to get some idea on the pricing available.

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Have a great day!
Yann