This is your SolarWakeup for March1st, 2017

Utility Math 101 by Duke Energy. PURPA contracts have been around for many decades, there was never an intention for them to create massive marketplaces for solar projects in places like North Carolina, Oregon, Idaho and more. Simply put, it makes utilities buy energy from power plants at the approved avoided cost. So when it comes to Duke Energy’s cry for help, saying consumers are overpaying for the contracts on solar projects, I wonder what they are really saying. Before solar, Duke never came forward to lower the avoided cost in the contract. Maybe Duke is saying that the rate was always too high and miscalculated for years but in reality they want to lower the value of the value so that less solar gets built. They have spent the last year blocking every application and is getting sued by developers. Watch for more PURPA attacks at FERC.
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 Don’t call it a comeback. Yet. NRG was early into the clean energy game when it comes to the IPPs and today they are far from the only one. You’ve seen several IPPs make the acquisitions and start business units to take advantage of the decentralized energy that gives consumers choice. Bridging this transition from producer to a consumer centric model takes time and some financial pain. It took the foresight and investments to create the path, and yes it took the firing of a CEO to shine the light on this venture. Looking at the progress from a financial perspective, it is fair to assume that the green energy vision outlined years ago will go forward.
If you stand for nothing, what will you fall for? Yes, solar is like telecom. It is the cutting of the cord from large, central, and top down approach to a consumer centered, decentralized power system. Most importantly it puts the choice in the hand of consumers instead of monopolies. There is much to lose and hence the fighting over this change is taken on by lobbyists and special interest groups. Until recently, the solar industry fought as if their lives depended on it, in many cases it did. With rumors of gutted policy teams, shrinking budgets and fear of being partisan, solar has taken a step back. In Indiana and Kentucky as well as other States, bills look to kill solar and it doesn’t look like much is happening to fight it. Where is the SEIA press release? Where are the national companies saving a market that doesn’t yet exist? We want to be the centered, well behaved children in a political battle. So in the words of Hamilton (the musical), if you stand for nothing, Solar Industry, what’ll you fall for?

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Yann

This is your SolarWakeup for February 28th, 2017

Who killed coal? Can we finally bury the lead on this story? Coal is dying and solar has very little and Obama has even less to do with it. The only way to bring coal back (and this is a stretch) is to ban natural gas. Clean Coal super project, Kemper, being built by Southern Company is not economical to operate unless you run it with…natural gas. Thomas Fanning, who gives his annual “I love solar” speech  at the BNEF Summit in NYC, told investors on an earnings call last week. Clean Coal is a myth, coal doesn’t work financially, and this may go into the history books as the project that buried the industry all together.
Help support independent media like SolarWakeup. If you are looking for investors or buyers of your projects, hit reply to this email and let us help you. Our expansive network is always looking to partner with you and helps us pay the bills to keep the newsletter free to you, as it has been for the past 4 years.
 The RPS is making a comeback. When we spoke to Senator Wiener of CA and Assemblyman Brooks two weeks ago on EnergyWakeup, we saw a trend. That RPS bills would make a comeback but I definitely didn’t expect it to happen so quickly. Minnesota is now looking at a 50% RPS bill. Let’s be honest about what this is and that is ratepayer protection. Legislators have done their math on energy costs and when it comes to keeping fuel cost subsidies out of the consumer’s electric bill, they know that renewables without fuel costs are the way to go.
Corporate PPAs for the win. The corporate RPS is also coming in fast but let’s give it some more time. The reason is that the corporate PPAs outside of virtual net metering and community solar States is a financial transaction in the form of electric contracts and hedges. Some corporations already do this but many don’t, especially smaller ones so it will take time for the industry to find the best way to do this. I prefer the PJM and ERCOT markets over regulatory rulemaking in community solar States. The reason is simple, I can’t control a utility regulator 10 years from now to keep the rules the same or to not change the value of the solar credit given to the offtaker.

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Yann

This is your SolarWakeup for February 27th, 2017

A deadline for cleantech startups. Free Electrons is a new program that Danny Kennedy told us about on EnergyWakeup podcast last week. There is a deadline to apply on February 28^th for companies that work to disrupt the utility space. The program is a global endeavor with partners from the world’s largest utilities. These companies, as Danny Kennedy told us, understand the future lies in renewables and their business will be transformed. By getting ahead of the curve and working with these innovators, the utility executives know they are helping their shareholders.
Events you can’t miss. I can’t speak more highly of the two organizations I have been working with from my very first day in solar. Vote Solar and IREC were both there when I flew to Tallahassee in 2007 and together wrote the net metering policies that have created a solid baseline for our market here. The nuanced regulatory fights, grassroots activation, workforce education and public education costs money and does good for our industry we must support. Do this today please. BUY A TICKET to IREC’s Impact @35 and Vote Solar’s Equinox. Even if you don’t go, buy a ticket (preferable the most expensive one).
The Big F Deal. Couple of highlights from the big deal of the week. AES is buying sPower with AIMco, the Alberta pension fund. This is AIMco’s second endeavor into renewables after putting $500million with DE Shaw RE Fund. My first observation is that this is probably not the number one choice outcome for sPower. They likely preferred a private yieldco with the pension fund but it seems that the pension fund wanted a large sponsor to stay at the top of the ticket. AES is a decent partner, they have large exposure to the space already but they have also exited from large scale development platforms when they sold Silver Ridge to SunEdison. This also isn’t surprising, CohnReznick’s Conor McKenna teased this in our interview a few weeks ago that pension funds were looking hard.
The Pricing on sPower. Breaking down the pricing on this is hard because we only get top line numbers. 1.274GW for $853million in cash and assumption of $724million in project debt. Doing the numbers, assuming standard tax equity terms, you get to about $2/watt of project valuations. The pipeline could or could not be in these numbers but instead in an earnout to the current owner FirTree. At a high level it seems like a win for FirTree having deployed the capital, making some acquisitions and exiting the development platform. Maybe FirTree Principals will now go big into another segment of solar now.

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Yann

This is your SolarWakeup for February 24th, 2017

Covering Innovation. Danny Kennedy has been in solar for a long time and hes been fighting for the clean energy economy for decades. Now he is leading CALCEF and deploying capital and grants to the best and brightest trying to change the world and our industries. We spoke to Danny in our latest EnergyWakeup about his funds and how the capital can get into entrepreneur’s hands. Next week is the deadline for a great program called Free Electrons (freeelectrons.co) which is funded in partnership with the World’s largest utilities. If you are in the utility space, get your application in ASAP.
Pot meet kettle. The economist got this one wrong, very wrong. While highlighting the huge growth of the renewable energy space it pointed out that the marginal value of most solar and wind is zero. The next electron doesn’t cost anything to produce. So instead, the article says the market needs to subsidize solar and wind to keep it profitable. That’s crazy talk. What the market will move to is proper price signaling. A more transparent market will lead to more choice and lower cost for consumers in all segments of the market.

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Yann

EnergyWakeup – Danny Kennedy From CALCEF On Cleantech Startup Investing and Innovating Utilities

This episode is sponsored by Conductive Capital, a distributed generation platform with tax efficient capital. In this episode we speak to Danny Kennedy, managing director of CALCEF (calcef.org) and President of CalCharge. Danny has gone from activist to entrepreneur and now investor, fighting for a clean energy future for many decades. CALCEF is the fund that is deploying early stage dollars into clean energy startups in a time when working with early stage companies could not be more important. We talk about the most pressing issues in the space and what kind of companies they are looking to fund. In … Read More →

This is your SolarWakeup for February 23rd, 2017

Electrify everything! I’ve been saying it for years and I’ll say it again. Solar needs to let utilities fight with the oil lobby and step out of the way. Once electric cars tick up the demand, solar will be there to fill the need.
Who pitched it? I hate this story with a passion. It was pitched by someone with an agenda enough with data to make the New York Times run with it. Last year, the same reporter ran a bad story about net metering in California and now this. The anti-Elon Musk lobby is real and here you see it in action.
SunEdison C&I is revived. Mitsui has acquired the team from SunEdison. Glad to see that happen and looking forward to see how those things progress.

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Yann

This is your SolarWakeup for February 22nd, 2017

100% for the win. While the Federal government wants to regress, and fail at leading us all into the future, leave it to California’s legislators to take the reins. The legislature has filed a bill to bring the 50% RPS to 100%. It had failed in the past due to the oil lobby’s push against the increase of fuel efficiency standards but this time it looks very promising. Bryan and I spoke about this with Senator Wiener on EnergyWakeup.
Do it yourself. Across the globe there is a new trend that is changing the world in amazing ways. When the poorest among us are without energy, light or clean ways to cook, they are turning to solar energy. No longer having to wait for dirty coal plants or costly transmission, solar is bringing access to new opportunities.
Florida Inside Baseball. Spring training is just getting started but there is some great political inside baseball going on in Florida. The Governor and the Speaker of the House are engaging in a battle royale regarding corporate welfare. Specifically, this battle is about tourism marketing and economic development dollars. Keep in mind that this is republican infighting. So you can imagine the irony in watching FP&L rate basing 800MW of solar while keeping the market monopoly away from private sector competition. Nothing to see here! That’s why we keep the capitol in Tallahassee.

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Yann

This is your SolarWakeup for February 21st, 2017

Solar on every roof, 80% RPS. Two bills that push the goal post in a direction we are not used to right now. Normally we are playing defense on kill NEM bills or attacks on solar markets across the Country. In this episode of EnergyWakeup we interviewed Senator Wiener of CA and Assemblyman Brooks of NV. Wiener is the sponsor of the solar on every new roof in CA bill and Brooks is the sponsor of the RPS bill in NV that brings it to 80%. Moving goal posts!
Oh Pruitt. He is a bad dude indeed. I don’t know why some people wake up and don’t have an ounce of decency but Pruitt is one of them. Rulemaking to stop CPP will start as expected. Let’s look at the flipside. Pruitt is a poster child for the environmental lobby, he has a history of hating the environment and using him politically should be straightforward. If you think the next three guys in line would have been any better, then guess again. Unless you want Myron Ebell?
Is nuclear going the way of coal? Over time my enthusiasm for nuclear has decreased and in the past few years have become convinced that we just don’t need new plants anymore. Water issues, safety issues, and capital logistics. With battery pricing and a shift to distributed generation do we really need new nuclear? I’m not as sure that no new plants will be built as I am that no new coal plants will be built but I think we are really close to this. Solar + storage wins out in my opinion.

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Yann

EnergyWakeup – Episode 5 – EnergyWakeup With Senator Wiener Of CA And Assemblyman Brooks Of NV

These are the top 10 most read solar articles by your peers this week!

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Yann