This is your SolarWakeup for January 25th, 2018

SolarWakeup Conference Call. I want to thank Colin Rusch from Oppenheimer and MJ Shiao from GTM Research for joining me on the SolarWakeup conference call to review Trump’s 201 actions, impact on price and what the market looks like under these new rules. If you enjoyed the conference call and would like to see SolarWakeup do more of them, I’d love to hear from you.
Making A Settlement. This is the next step that many are foreshadowing. It was listed in the proclamation and mentioned in the President’s comments. Now Hemlock is leveraging the tariff to push the parties to finally get behind the settlement. I don’t know why the settlement didn’t happen before and I can’t understand why it wouldn’t happen here. None of the petitioners win with this tariff and it doesn’t actually help create more module manufacturing here. The question is how does the settlement happen now, who gets into the room and when can it happen?
Who Gets Exempt. The annex to the tariff proclamation is out and there isn’t much in there that we didn’t expect. Mexico and Canada remain on the included list and there is no exemption for 72 cell or high efficiency premium modules which were asked for during the process. Consumer solar products are exempt so you can continue to buy solar powered backpacks and driveway lights. We do expect to see additional information about the cell import quota and companies filing for individual exemptions soon.
Calling The End To Gas. Danny Kennedy of CalCEF is out with a thorough view of the natural gas marketplace and the current pain it is in. As we look at the future of energy storage pricing, the process for replacing gas will happen fast. The paradigm shift will occur when markets move from minute pricing to second pricing.
SolarWakeup Live. New York will be the largest SolarWakeup Live! to date. The speakers are geared to give you great insight and information about where to focus. This event and future ones will now be more than just great content but also a great place to meet solar professionals. There are still just a few seats left if you would like to register. After SolarWakeup Live! there will also be a happy hour that we are co-hosting with EnergeiaWorks. Register here
Presented By Panasonic. When you install Panasonic HIT® high-efficiency solar panels, you’ll provide homeowners with what we believe are the most efficient solar modules available today. Let’s take your business to profitable new levels together. 

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Yann

This is your SolarWakeup for January 24th, 2018

Trump Proclaims. Yesterday, in a public signing in the Oval Office Trump signed the 201 tariffs in a proclamation. I can’t do the comments justice, you have to watch the video for yourself to listen to see how out of sync the comments are with reality. You have to wonder where the disconnect is when the solar industry met with the person standing behind the President but the comments remain so factually incorrect. While I expect the blame to be put on the Trump factor, I am concerned that the advocacy appears to have failed at every level, the USITC, the USTR and then the President. As a reminder, this is the third trade case that solar has lost. Outside of the ITC extension, we can’t say that DC has been kind to solar.

Don’t Buy The BS. Solar will survive is not an answer for this tariff. Yes, the market will move forward because there is no other option. BUT. This isn’t a non-factor. Solar was not advocating for this result privately. Manufacturing will still not thrive in the US. I’ve read all the spin that has come across my desk and it’s largely all BS. Most of all, this is not a good thing for solar. We’ve all been struggling to find profits within the right balance of volume. Taking 10 cents off the top means less money to pay for the operations of your solar company.

Tariff Impact Data. Greentech Media is out with the data on the impact from the tariff which is enacted on February 7th. In the next month, you will also see a process for exemptions for products that consider themselves eligible. GTM Research will be on our conference call today at 3pm.

For Sale. PREPA, the Puerto Rico public utility, is going to be privatized. Consider NextEra an interesting candidate to make that move given the need for some aid from Congress to make it work. You can also see some European players make a move to engage the process.

My View On What’s Next. Some things need to change in solar. Going 0 for 3 on trade cases means that the entire approach is broken. My thoughts on the matter. Make sure to register for SolarWakeup Live! New York to continue this discussion

Presented by Mintz Levin. Mintz Levin is an Am Law 100 law firm with a nationally recognized Energy & Sustainability Practice that has completed more than 500 transactions across energy sectors totaling over $7.5 billion since 2006.

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Yann

This is your SolarWakeup for January 23rd, 2018

Tariff Breakdown Conference Call. Join me tomorrow for a conference call at 3 PM EST to discuss the tariffs put in place. I will have a few experts on to discuss their take in addition to mine. RSVP Here.

The Decision. By now you have seen the news, Trump put a 30% tariff in place in response to the ridiculous 201 petition. It declines 5% per year and the first 2.5GW of imported cells are exempt. There does not appear to be an exemption for anything, module size or country of origin. Everyone is denouncing the decision rather harshly, especially given the overarching advocacy against the tariffs. This is the third trade case that solar has lost in the past few years, a record that is not to be emulated.

The Bad. Module prices are going up and it’s going to hurt. Markets, especially large scale ground mount, in places that use PURPA or hedges are going to suffer. 10 cents is more than the margin in most cases which means that the price pressure is going to get intense. The fact that solar lost again is also a sign that we must think about doing things differently. I ask again, what would it take for a US cell phone maker to file a 201 against Apple and actually have it hear. It would never happen. Solar must review the plan of action it undertook and understand what went wrong and what has to change going forward.

The Good. It’s not nearly as bad as it could have been. On the other hand, once pricing settles back into place, you may be surprised to see pricing below Q1 2017. In fact, I believe that most people will buy panels below where they bought most of the 2017 modules at. Also, the uncertainty is over. No more discussions about import risk and who takes the risk of retroactive tariffs. You can go about your business with a clear set of guidelines. You have also seen how bad it can get if you don’t get involved. Use this opportunity to look at your own actions and what you could have done differently.

Settlement. Lighthizer’s comment is right in the tariff press release. The USTR will look to engage interested parties to try and create a global settlement. My take, the 201 tariffs do little to help SolarWorld and Suniva with cash and the global settlement is the best way. I would look to remove the all the US tariffs and the Chinese tariffs on US silicon while creating an import license to drive cash to US manufacturers. This would lower the overall cost of solar in America and grow the market while actually helping grow US-based manufacturing.

Longer View. If you want even more of my opinion on the matter including what I think needs to happen next, check it out here.

Talks Continue. Join me in New York next Wednesday to talk about the 201 process with an industry insider who was in the room. Hint: It’s not Alexander Hamilton. Register here.

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Yann

SolarWakeup View: Trump Announces Section 201 Determinations for Cells and Modules

By Yann Brandt What: Trump Announces Section 201 Determinations for Cells and Modules Summary: Shortly after the Government shutdown ended, Trump announced 30% tariffs on cells and modules with the first 2.5GW of imported cells being tariff free. This ends the 201 proceedings after over 6 months of battling within the solar industry. The tariff has a 4 year life with a 5% reduction each year ending with 15% in year 4. SolarWakeup View: Now that the tariff is set, the solar industry has a few things ahead for itself. First, it can start transacting again. For the past 6 months, suppliers and … Read More →

This is your SolarWakeup for January 22nd, 2018

What A Week. It is widely expected and planned that Trump will announce a tariff in response to the 201 petition filed by the terrible companies, SolarWorld and Suniva. Led by terrible management, executives are hoping to reframe themselves by blaming others. If you haven’t stopped buying those products, you should ask yourself why. More than anything the damage is done already, the market has been at a standstill for over 6 months while the case went through the process. I personally believe that this was done with intention. Suniva met with trade representatives prior to filing and my conversations with agency personnel also indicated that a move against China was desired by the administration.

What To Expect. SEIA and solar executives met with Wilbur Ross a few weeks back. Now that it seems that Ross is on the outs with Trump with Lighthizer taking command of trade negotiations that meeting could be a negative if Ross went to the Oval with a pro-solar view. As Amy Harder told the crowd at SolarWakeup Live! DC, Lighthizer is much more of a China hawk than most in the group of advisors. Even with the conservative pushback on the solar tariffs you should brace yourself for tariffs and quotas, the question is how much of each. Some have said that tariffs could come in high but not high enough to matter to SolarWorld and lacking the cash for Suniva to be happy. Quotas could be put in place but nobody is excited about the prospects of having totally the total imports from China.

A Global Settlement? I can only hope. This has been 7 years in the making and everybody is losing right now except those opposed to solar. The idea would be to stop the tariffs in the US on foreign modules, stop the tariffs in China on silicon and add some cash import fees on materials that would result in aiding local manufacturing. Downstream solar keeps getting crushed by these bogus trade cases as development entities can’t handle the starts and stops of the market.

SolarWakeup View. First, solar needs to take some lessons from the Patriots. Win at any cost. Stay tuned for more info once the tariff is announced. We will hold a conference call shortly after the announcement with a few experts to give you their take. Make sure you join us in New York to get more info about the tariffs and how it will impact your business going forward. Only about 20 tickets left at this point so get them while they are still available.

Presented By EnterSolar. EnterSolar is a leading provider of solar photovoltaic solutions to the commercial marketplace that is ranked the #1 solar developer in New York State and in the top 10 nationally.We are currently hiring at our growing company. 

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Yann

This is your SolarWakeup for January 19th, 2018

Solar Reality Show. “You know, they dump ‘em - government-subsidized, lots of things happening - they dump the panels, then everybody goes out of business,” Trump said (to Reuters in the Oval Office) just before teasing that the announcement on tariffs is forthcoming. Advocates appear to be indicating another level if the tariffs come back bad for solar. They are saying that tariffs could be the baseline towards a global settlement on modules and silicon but analysts are not optimistic that this could happen. Either way, we will be going through this in great detail at SolarWakeup Live in New York in a few weeks. For one day only, you get 50% off by using code LIVE50 thanks to the bigger theater space we moved into.

SolarWakeup On The Road. Over the next few months you will have plenty of places to meet me and talk solar. I will be hosting a keynote interview at Midwest Solar Expo in May and COSEIA’s Solar Power Mountain West in March. In February I will be in DC for a few days for a DOE event and speaking at a storage event in San Francisco. Pretty much if there is a microphone that needs to be spoken into, count on me to try and stand behind it. Come say hello at all of these events and look out for the next SolarWakeup Live after New York.

Storage Versus Gas. Gas is getting cheaper and it is much more flexible than peaker plants. It dispatches faster and for shorter periods of time as needed. That being said, stand alone storage economics will be hurt by the volatility of the charging price unless colocated with generation plants, preferably solar plants. If colocated with solar than you must be thinking about dc-coupled because redoing your interconnection and using additional bidirectional inverters will change the way you finance your solar plant. I’d like someone to challenge me on this thinking because I haven’t heard an argument for ac-coupled on colocated plants.

Social Cost Of Business. Blackrock’s CEO, Larry Fink, knows business and he knows businesses that make money. He is also out with a new letter saying that businesses owe society a bit of a social contract and the requirement to think about the longer term. For many of us in solar, we realize our work is hard and oftentimes without thanks. We work on projects with thin margins and a tough road ahead but we know our mission is worth it. Similar to Fink’s social impact I want to ask the following question to solar companies. If you were asked to give $10,000 a year to solar advocates like Vote Solar or your State Chapter, would it kill your business? If yes, do you think your business has issues other than market/regulatory? If no, can your business be killed by market/regulatory changes?

Power Market Mayhem. January has been a crazy month for power markets. ERCOT went to over $2,000/MWh and gas prices in New York went to over $175/mmBtu. Both crazy.

Presented By Pfister Energy – Your only source for turnkey design-build renewable energy system solutions. We provide world-class power solutions for the commercial, industrial, and utility sectors with an emphasis on energy efficiency and energy management. Contact us for a free energy audit at your facility.

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This is your SolarWakeup for January 18th, 2018

Growing Power Demand (Finally). PG&E is out with the goal to install 7,500 EV charging stations in their service territory. EVs are the gift to utilities around the Country that have been losing power demand to LED lightbulbs. Utilities make their money by building more infrastructure to keep up with more energy demand and if the demand doesn’t grow neither does a utility’s rate base. 7,500 level 2 chargers are a drop in the bucket, just wait until utilities propose 100,000 fast charge stations at 100kW+ each.

Christie Out. Murphy In. After a bill to keep the NJ solar market going passed the legislature, Chris Christie decided he was done working for the people of New Jersey. He put the bill away and killed the bill with a pocket veto. The new Governor, Phil Murphy, was inaugurated and now the bill has to go through the legislature once again. Good news for NJ however as Murphy is making quick work on energy and appointments to the DPU.

Making A Deal And A Plea. Various reports will come out until the White House issues a ruling. Here’s a scenario that will keep people hopeful even after a ruling. A straight tariff doesn’t really do anything for Suniva and SolarWorld, because they wouldn’t access of that cash. All it does is increase the market price and that isn’t really their problem, they need cash. Additionally it would likely result in more tariffs against American goods by China. The ideal scenario for everyone is a deal that drops the initial trade tariffs and removes the barrier for Hemlock to sell silicon to China once again. Ideally the deal then results in tariffs to be charged on imports that create cash for US manufacturers. This is a simple fix for this problem and I’m a bit surprised it hasn’t happened yet. Maybe someone call tell me what the barrier is.

Play With PACE. How many of you have used PACE for a solar project? What were the barriers you were able to overcome by using PACE? Now that more than just California is getting into the game and SEIA is mainstreaming the PACE plus PPA, I can see more contractors leveraging this standardized solution. I’d love to hear from you on this topic.

Presented By FlexGen. FlexGen has been providing energy storage solutions for military and microgrid applications for nearly a decade and installed the largest DC-coupled solar plus storage project in the world. Their integrated solution is ideal for your dc-coupled storage project for projects over 250kW.

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This is your SolarWakeup for January 17th, 2018

Listen Closely. I went back and listened to my interview with Amy Harder from Axios yesterday. Inside the conversation there were some things that were coming true in reality. The Goldman group inside the White House doesn’t seem to be having the impact we were expecting, much like the conservative think tanks, Sean Hannity, etc. Also the argument about jobs and job losses don’t seem to be moving those inside the conversation. More than anything, the bad actor label on China seems to be coming to the forefront. Go back and listen to hear what I’m talking about.

Don’t Click The Bait. We are done breaking low cost of renewables records. The conversation needs to drive towards, what do you need in order to have this energy need come from solar, wind with or without energy storage. The data from Colorado says absolutely nothing. Without knowing the ratio of storage to generation, you cannot ascertain anything at all. You also don’t know what they are doing with storage, what grid services they will provide and how many hours of capacity they are proposing. Don’t look at these results for any business metrics. Your cost of money divided into the capital costs minus operating costs will still give you the best view of the bid price. Rant over.

EVs Rule The (Future) Road. I love the additional investments into electric cars by other auto OEMs, Ford announced an $11billion push towards EVs. I’ve been an EV owner since 2012, first a Volt then a Tesla. The Volt buying experience was eye opening and I wouldn’t be surprised if it was the same today. The sales person knew nothing, nobody at the dealership did. How to charge, how many miles of range, what happens at the end of the range? All the OEMs will need to invest in education of the sales force. If I were Autonation, I would have an EV only showroom. Completely separate the force from the traditional vehicles and make it a competition and not a closing exercise. Tesla doesn’t have this problem by only selling EVs. At the end the solar industry wins because EV owners want solar and EVs will drastically drive down the price of batteries.

You Get A Job, You Get A Job. Energy jobs keep growing especially at the labor and middle class level. If you want to make more than the average American in your job segment, then being in solar is a great place to be. On the other hand, you may have to work through the solar coaster, stand at rallies and enjoy the sunshine. I can only imagine how many jobs solar would create in Florida if our policies opened up just a tiny bit. The same is true for Kentucky, West Virginia and Ohio where most of the remaining 60,000 coalminers live.

China Is Dumping Projects Too. $0.3Trillion was invested in clean energy worldwide last year, half of it in solar. Half of the solar investments came from China which begs a curious question relating to the 201 proceeding. Should US capital file a complaint about Chinese capital buying too many projects? Is that unfair as well? Maybe that is the correlation to the real estate market that the White House would understand.

Are You Coming? There is a surprise addition to the SolarWakeup Live! event in New York. We will have an unnamed speaker (for now) that has been in almost all the meetings around the 201 case. By the time we meet in New York, the tariff should be decided and you will get to hear how it happened and we may indulge in some conversation looking back at the process. This is inside a cool theater in midtown, join us. 2 for 1 offers available if you email me.

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Yann

This is your SolarWakeup for January 16th, 2018

Amazing Hypocrisy. A Chinese company complaining about Chinese aggressive path into solar module manufacturing? You’ve got to let that sink in for a minute to realize how pathetic the argument from Suniva and SolarWorld really is. SolarWorld was bailed out by Qatar which is not known as a friendly global actor. Meanwhile Suniva, which couldn’t survive with tens of millions in grants, had to be bailed out by Shunfeng, a CHINESE fund. It was only once management failed to run the business properly that the former CFO saw an opportunity to run a scam on the American people with the 201 filing. Trump is being played by these folks that have misled everyone on their way to this moment.

Label The Opposition. No matter the result of the trade case, solar will look back at its tactics and realize that it played flag football in a full contact sport. There was a level of purity that the good team wanted to maintain and that wasn’t the right way to go. Think about the logic of a bankrupt Chinese company with no money and no path to ever opening up again being given the same credibility in the process as 270,000 solar professionals. In politics, you either brand your opponent or they will brand you and solar made their impact of a bad decision the argument and not the poor messenger that was trying to destroy solar.

Shell Acquisition. A few weeks after BP made the investment into Lightsource, Shell is following suit and acquiring shares in Silicon Ranch. Much of the summaries written by reporters is to hyperbolize the impact this has on the energy markets, an oil company buying a solar company. All that is BS. This is about diversifying investments and revenue streams. It would be managerial malpractice for energy companies not to have exposure into solar and the associated interconnections to the electric grid.

PG&E Must Lead The Way. We may look back on this week in a few years and saw the regulatory start to shifting away from natural gas plants. The CPUC is asking PG&E to solicit energy storage instead of making a deal with Calpine. At the same time solar advocates are pushing Michigan regulators to review the DTE request to build a new gas plant. The fundamental argument I use against regulated gas is the subsidy given to the utilities by consumers. Unless the IOU takes the fuel cost risk, the consumers should be paid for the hedge on the fuel price. The value of that hedge needs to be included in the comparison to long term renewables contracts that have no fuel cost risk.

The Q&A You Wanted. You asked for it and you’ll get it. When SolarWakeup Live happens on January 31st, we should know what is going on with the 201 case. Many of you asked me to include a Q&A so that we can talk about the various issues in the solar industry and my thoughts on the state of the market. We also moved into a larger auditorium that can hold a few extra folks. If you email me, I’ll give you a 2 for 1 coupon code so that we can have a full theater and make the networking that much better. Tickets here.

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Yann

This is your SolarWakeup for January 15th, 2018

New Pod. I am joined by Boris von Bormann, the CEO of Mercedes Benz Energy Americas, in the latest episode of EnergyWakeup. His role oversees the current initial roll out of the Mercedes storage systems for homes but Mercedes also makes cars that you may have heard of. The combination of the two markets intrigues me and we talk about it in this episode. Catch it here.

Last Minute Efforts. Tom Werner from SunPower has an oped The Hill today that pushes back against tariffs and praising Trump in equal parts. I get the sentiment, everything out of DC today shows the need to praise in order to drive the conversation. My larger concern is that Trump’s advisors have treated both sides of the tariff debate equally and this is in no way an equal debate. Most folks expect news to happen this week, I’ll start writing two template emails to send you I guess.

Taking On Gas. In one week, Vote Solar has taken on an anti-solar decision and at the same time a pro-gas decision. The latter is interesting. The argument against DTE Energy’s request to build a $1.2billion natural gas plan is that renewables would be a better deal for customers and DTE should show its analysis to make its case for gas. This is an offensive maneuver by Vote Solar in a State that under Governor Granholm was working hard to be a clean energy leader.

Crypto. ACWA Power is joining the crypto movement with the currency, SolarCoin. I’m going to ask some questions about coins and blockchain during our New York event to the CEO of LO3 Energy, a blockchain expert. This could come up in that conversation.

NYC Agenda Set. We’ve got our agenda set with 5 amazing conversations. I’ll be catching up with NY Green Bank’s CEO, one of the most innovative and successful green banks in the Country. The other conversations are with the manufacturer of the largest solar plus storage integrator in the world, breaking down the REV policy, blockchain in energy and future of community solar in New York. All of the conversations in a great theater setting in midtown. Please consider joining us for this event, discounts for multi tickets if you want to send your team. Here are the tickets.

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Yann