This is your SolarWakeup for June 5th, 2018

Strategic Reduction In China’s Solar Market? China’s solar market is in for a shocking halt after an announcement by the governing body last week. Most of the publicly traded solar companies had a bad day yesterday after being downgraded on the change in subsidy policies that kept that capacity flowing at a massive pace. Let’s see how that affects the market pricing in the US, the oversupply could create competition that will center around pricing for the domestic projects. BUT I wouldn’t be surprised if there isn’t an impact that tries to stop the oversupply from coming this way given the 201 and AD/CVD tariffs are all percentage based charges.
Big EV Infra. I was amiss in speaking about this when it happened over the weekend but multiple regulatory bodies in CA and NY approved over $1billion in EV charging infrastructure to be built by the utilities. This is a massive upside for utilities that not only get to rate base the infrastructure, something I support, but also benefit from the increased load this will create from the EV adoption curve that this will cause since consumers will no longer worry about range. The conversation with regulators should be that any increased demand should be supplied with solar and storage and not rate based power generation.
Will The Consumers See This? The Trump coal and nuclear bailouts are going to cost money but the cost isn’t bourne by taxpayers but it may cause a two stage impact. The first level is similar to steel and aluminum tariffs with manufacturers and will affect the retail energy companies. Some may not have a way to pass the additional cost to the consumers while they are under contract and consumers that are about to renew will be in for a shocking price increase. Not only will consumers pay the actual increase but there will be a regulatory risk premium that otherwise would not have been there in a rational market. The price of the unknown is sometimes bigger than the actual price increase especially when a risk committee has to think about crazy possibilities.
Settling In North Carolina. Environmental and solar groups settled with Duke on their grid modernization efforts which were originally slated for greater than $7billion and settled at $2.5billion with some pro renewables policies attached. This comes in parallel with some leading indicators that Duke may be trying to stop energy storage to be added to solar projects, more on that to come.
Climate Change Financing Risk. Do you look at the climate change risk of a property that you are looking to fund a deal on? How do you do it and have you lost a deal because of it?

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Have a great day!
Yann

Chinese Solar Market Suffers Severe Setback As Government Slashes Subsidies, Projects

Town of Bethel and Ameresco Celebrate Completion of Solar Farm on Capped Landfill

Ameresco, Inc., a leading energy efficiency and renewable energy company and the Town of Bethel, are hosting a ribbon-cutting today at the Town’s capped landfill to celebrate the completion of the solar photovoltaic (“PV”) facility. The Town partnered with Ameresco to develop the solar PV project under a 20-year Power Purchase Agreement (PPA). Ameresco will operate and maintain the system for the term of the contract to ensure optimal energy production. “For years, Town leadership, staff, and community volunteers have been working diligently to identify and implement meaningful energy efficiency and renewable energy solutions. With today’s ribbon-cutting, we celebrate another milestone in our journey to a more sustainable future,” said Matthew Knickerbocker, First Selectman, Town of Bethel. “This solar project represents a key piece of our overall community strategy to become more energy efficient and cost effective in our municipal energy operations.” “I’m pleased to participate today to help recognize the Town’s significant contribution towards environmental stewardship,” said Tracy Babbidge, Bureau Chief for Energy Policy at DEEP. “I congratulate Bethel’s leadership for their commitment to protecting natural resources and inventiveness in finding a sustainable solution to the siting and development of renewable power for the financial benefit of the Town.” Bethel’s solar farm is comprised of more than 2,900 photovoltaic panels totaling 947.7 kW DC and designed to generate over 1.2 million kWh of renewable electricity each year. The solar farm is connected directly to the local utility distribution system. The annual CO2 emissions reduction of 934 metric tons is equivalent to taking 200 cars off the road and annual electricity usage of 140 homes. “Ameresco is delighted to have had the opportunity to work with the Town of Bethel on this solar project,” said David J. Anderson, Executive Vice President, Ameresco. “Renewable energy projects like this one directly benefit the Town. With 100% of the solar system’s energy generated used to power Bethel’s town buildings and operations, through virtual net metering, the Town’s consumption at key buildings is offset. Furthermore, it demonstrates the Town’s commitment to sustainability.” This project brought the Town landfill into compliance with the Connecticut Department of Energy and Environmental Protection. The Town of Bethel is now being supplied by green renewable power.

Wisconsin Utilities Agree To Add 300 MW Of Solar To Portfolios

Iron Mountain Joins RE100 and Commits to Setting Science Based Targets for Carbon Reductions

Iron Mountain® Incorporated (NYSE: IRM), the global leader in storage and information management services, today announced two important environmental commitments that significantly advance the company's efforts to reduce its carbon footprint and increase its usage of renewable energy around the world. Firstly, Iron Mountain is joining the RE100 initiative, a collaborative, global platform developed by The Climate Group, an independent, not-for-profit organization working internationally with government and business leaders to advance smart policies and technologies to cut global emissions and accelerate a low carbon economy. Iron Mountain joins more than 130 multinational corporations in committing to a shift to using renewable energy sources for 100 percent of its worldwide electricity. In doing so, Iron Mountain pledges to follow a rigorous standard for green power purchasing and achieving aggressive interim milestones on the way to a complete conversion by 2050. Secondly, Iron Mountain announced its commitment to set an aggressive science-based target for carbon reduction by the end of 2019. In doing so, the company will work with the Science Based Targets Initiative (SBTi), which helps companies determine how much they must cut emissions to do their part to address climate change, to calculate and approve a reduction in carbon from current levels. This promise puts the company on a trajectory for decarbonizing its operations in line with the global goals of the Paris Climate Accord. "We applaud Iron Mountain for taking these important steps to address climate change," said Mindy Lubber, CEO and president of Ceres, a sustainability nonprofit organization working with the most influential investors and companies to build leadership and drive solutions throughout the economy. "By committing to 100 percent renewable electricity and setting an ambitious science-based carbon-reduction target, Iron Mountain is joining a growing number of major companies that understand the huge economic benefits and clear competitive advantage of climate action." In Iron Mountain's recently released 2017 Corporate Responsibility Report, the company reports achieving an absolute reduction of 6.6 percent in year-over-year carbon emissions – even during a period of continued business growth and service expansion. Iron Mountain is also a member of several collaborative efforts to advance the use of renewable energy including the renewable energy buyer's alliance (REBA) a collaboration of World Wildlife Fund, World Resource Initiative, Rocky Mountain Institute and Business for Social Responsibility. The company is a signatory to the Renewable Energy Buyers Principals, a member of the EPA Green Power Partnership and recipient of the 2017 Green Power Leadership Award. "We're proud to be among the earliest adopters of renewable energy," said William Meaney, president and chief executive officer of Iron Mountain. "Understanding the impact of our energy usage has led to the adoption of energy and greenhouse gas reduction strategies that are helping the company save money, reduce environmental impacts and better serve our customers. In making these commitments today, we are setting aggressive public goals with the endorsement of well-respected non-profit organizations, accelerating our efforts to foster strong economic growth while operating as a responsible, ethical and sustainable company."

This is your SolarWakeup for June 4th, 2018

Solar In Illinois. The Illinois Power Agency is looking to finalize the adjustable block program which will be key to the distributed and community solar markets in the midwest’s solar market. SolarWakeup Live will start the full day looking into the market with the director of the IPA, which on June 21st will likely have the rules finalized, so that you can get on the ground and moving forward. We have a few more sponsor spots for the event (email me) and tickets are available at solarwakeuplive.com.
Coal Collusion. Looks like coal magnate, Bob Murray, got what he wanted from Trump on the 1-year anniversary of announcing the departure of the Paris agreement. The best response going around about this announcement is from the PJM twitter account. To date, PJM has not been notified by governing agencies to prop up coal plants yet but expect that to happen. The way for the government to really prop up these plants without picking winners would also cause the value of solar generation to increase which then causes the demise of coal to quicken. So here we are, throwing wind to the free market, rules be damned.
Arizona Plea Deals Rejected. This is your reminder that the original sin in fighting solar net metering is still embroiled in a federal grand jury investigation. Now there’s news that a former regulator and lobbyist are rejecting plea deals in the case. When I read this, I can’t help but to think of the many ex parte communications happening every day across the Country and we may be better off when the power isn’t concentrated to the monopolies anymore. Just a thought.
Thoughts On NV Energy. The gigawatt of solar represents the value of solar in high irradiance areas, like Nevada. Also, I’d be amazed if storage isn’t closer to 2GWh than the 400MWh outlined in the proposal. Let’s revisit this in a few years.
Slowing Chinese Solar. New rules from the Chinese government have caused a few people off guard. This is perhaps a sign of the strength of the global markets. Imagine what else would be possible with the trade wars.
Quality Of Resi Solar. Australia has been growing distributed solar in a big way and a lot of it has to do with the ease of installing solar on homes. Little delay between selling and installation means consumers are happy. With the ability to review the installs later on, gives the consumer advocate a way to make sure installers are doing a good job and there is some work to do. In the US, we need to do more to get closer to an instant solar process. We also need to do more in having the solar industry regulated by solar experts. We will be discussing this in much greater detail this summer but ponder how the solar industry could ensure that consumers are getting great solar.

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Have a great day!
Yann

UPDATE: Trump Throws Free Market Principles Out Window On Behalf Of Coal, Nuke Plants

PPL Corporation Acquires Safari Energy

PPL Corporation announced that it acquired Safari Energy. a leading provider of solar energy solutions for commercial customers in the United States. "The Safari Energy acquisition offers PPL an attractive, low-risk opportunity to help advance a cleaner energy future; to support the growth of distributed energy resources, including energy storage; and to gain additional experience with technologies that will play a bigger role in shaping the future energy grid," said William H. Spence, chairman, president and chief executive officer of PPL Corporation. "However, even as it provides these benefits, the acquisition will not alter PPL's core business strategy," Spence said. "PPL's primary investment focus and engine for growth remains our high-performing, award-winning regulated utilities." Safari Energy develops highly structured turnkey solutions to its clients, managing projects through all phases of development, from inception to financing, design, engineering, permitting, construction, interconnection and asset management. Headquartered in New York City, Safari Energy has completed more than 200 solar projects in 19 states, with over 80 projects underway. "I'm very proud of Safari Energy's track record of using solar power to unlock incremental revenue for our customers," said Matt Rudey, chief executive officer, Safari Energy. "PPL's acquisition of Safari will support our continued growth and allow us to expand our offerings to better serve our customers." PPL also announced today that it has hired industry veteran Vijay P. Singh to lead PPL's involvement in the evolving distributed energy resource space and to complement the Safari Energy team. Singh previously served as executive director of Renewable Energy Development and Energy Storage for NextEra Energy Resources. Terms of the Safari Energy transaction were not disclosed. The company said the purchase price is not material to PPL. While PPL expects the transaction to be earnings and credit accretive immediately, the company does not expect Safari Energy to contribute meaningfully to PPL's earnings per share through the company's current forecast period, which extends through 2020.

The Energy Show: John Farrell on Why It Costs More For Utilities to Sell Power

For over a hundred years our civilization has been getting electricity from centralized generation. This utility business model relies on remote power plants fueled originally by coal, oil and gas — and now increasingly by wind and solar. But the development of inexpensive rooftop solar power over the past 20 years is changing this central generation paradigm. It is now cheaper for homes and businesses to generate their own electricity on their rooftop, and only stay connected to the utility for night time power. These Distributed Generation (DG) solar power systems are connected on the customer’s side of the meter, or referred to as Behind the Meter (BTM) from a utility’s perspective. Utilities generate their profits by selling power, as well as owning the power plants and utility power lines. When customers generate their own power, utilities lose revenues. Moreover, when customers pay for their own solar generating systems, utilities do not get to own additional generating assets – further reducing their profits. This loss of revenues and profits is disrupting the conventional Investor Owned Utility (IOU) business. Utilities claim that there are costs being shifted from solar customer to non-solar customers. This cost shift argument is nonsense, since in reality the utilities are trying to regain their lost profits from solar customers by increasing rates for everyone else. Think about it: since utility customers are going elsewhere for the utility’s product (electricity), utilities are raising prices for everyone else. Nice work if you can get it. The trend towards BTM solar (and now battery storage) is inexorable as these technologies continue to get cheaper. The aptly named Institute for Local Self Reliance (ILSR) focuses on these technology and sociological transitions. Our guest on this week’s Energy Show is John Farrell. John directs the energy program at ILSR and is best known for his research and papers on economics and benefits of local ownership of decentralized renewable energy. John is one of our best thinkers and communicators on this subject, so Listen Up to this week’s Energy Show for his commentary on the superior economics of Behind the Meter solar and storage. https://soundcloud.com/theenergyshow/john-farrell-on-why-it-costs-more-for-utilities-to-sell-power-1

Trump To Throw Free Market Principles Out Window On Behalf Of Coal, Nuke Plants