This is your SolarWakeup for May 24th, 2017
A No Surprise Decision. The Trade Commission has accepted the Suniva petition for relief. It will render a decision by September 22nd and put it on the President’s desk by mid-November. I am not surprised, this is political, not logical. Hard to handicap where this goes from here.
No Soup For You. The ‘Taxpayer First’ budget was printed yesterday which outlines a Trump budget plan. For energy pros, it means big cuts to the offices that study and advance our sector. With a Congress that hasn’t passed a budget in many years, let’s not be surprised if that trend continues.
The Energy Storage Road Show is moving forward now scheduling the week of June 5th in Los Angeles!
Solar Plus Storage. Tucson Electric is apparently entering into a solar with storage PPA at some amazing headline prices. Whether that includes capacity payments is to be reported but my guess is that 4.5cents is not all in. On the other hand, storage is dropping its costs and solar plus storage PPAs are starting to make appearances.
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Yann
This is your SolarWakeup for May 23rd, 2017
Solar Held Hostage. Extortion seems like the right word right now. SQN seems to be openly saying that if someone buys the Suniva assets for $55million, the petition will go away. Hopefully the words will be used to show that Suniva does not speak for the industry when it comes to determining the eligibility of the petition. Also, a better offer for shareholders is being proposed by a competing lender, Lion Capital. This means the Judge could have Suniva use someone other than SQN for debtor in possession lending and the petition could go away. Stay tuned.
Hard Day in Oregon. SolarWorld is giving itself some options by issuing WARN notices to employees in Hillsboro. That means the factory could close within 60 days and some 800 employees could be terminated. Hardware remains hard and consolidation in the module supply segment is bound to become reality.
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Yann
This is your SolarWakeup for May 22nd, 2017
On my plane en route to San Diego, will dive a bit deeper into storage this week.
Swiss Have Spoken. A vote was taken in Switzerland on whether voters want to move the grid into a renewables future or build more nuclear power plants. Unlike the US, where nuclear is the most subsidized power source, the Swiss have voted to go towards solar, wind and hydro. I would presume that similar votes in the US would go the same route, people just prefer solar over other sources. As price of storage comes down, the opposition argument of ‘when the sun goes down’ will get quieter. In the meantime, keep laughing at ludicrous arguments that corporates should bail out nuclear power plants, ratepayers have been doing that long enough.
The DOE Study. DOE studies aren’t supposed to be predetermined, they are supposed to be based on science and data. That is why the industry is screaming foul about DOE’s current lack of interest in the information needed to complete the grid study correctly. Even Republican Senator Chuck Grassley is standing up and asking for the study to be done properly.
The Energy Storage Road Show is moving forward now scheduling the week of June 5th in Los Angeles!
So Much For Chinese Dumping. We often talk about Chinese dumping of modules, which I view with a grain of salt, plus I like cheap modules because they keep us all in business and lower costs for our customers. One of the things we overlook is just how big the Chinese market has been over the past few years, China is creating its own market so that manufacturers can get product out of inventory. So instead of complaining about China’s desire to make it up with volume, let’s thank them for creating the scale.
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Yann
This is your SolarWakeup for May 19th, 2017
Shortened summaries today, since it is Friday and who wants to read on a Friday. Enjoy your weekend! I’ll be in San Diego next week so stay tuned for a conversation on solar plus storage.
Now We Know. Want to know the impact of a protectionist policy that will protect no jobs? Look no further, IHS has the research.
The Curtailment Risk. Curtailment reductions on revenues for large scale projects were discussed much in recent years. Buyers would typically value the entire revenue stream but that looks like a new regulatory risk.
The Energy Storage Road Show is moving forward now scheduling the week of June 5th in Los Angeles!
Green Legos. When someone gives my kids a lego as a gift, it is hard for me to let them open and build it themselves. Now that Lego has reached its corporate goal on renewable energy, I’ll definitely take it from them.
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Yann
This is your SolarWakeup for May 18th, 2017
Big Batteries Are Coming. One of the leading developers in solar is coming out with big batteries to add to their solar farms. This is no surprise as curtailment becomes an increasing topic and ancillary services add potential revenue. The storage market is getting consolidated quickly, with another acquisition this week of Greensmith by Wartsila. How will projects get executed? Both large scale and behind the meter C&I? Those are questions I am looking to answer on the road show. I have ideas and thoughts but want the market to tell me what they are seeing on the ground. This is the ultimate coordination of software and hardware. Companies have to be really good at both, which is really hard.
But I Thought. News came out yesterday that the majority shareholder of Suniva, Shunfeng, wasn’t supportive of 201 petition. Keep in mind that Shunfeng also owns whatever is left of Suntech. Now Yingli is looking precarious according to reporting. Without a doubt a major brand in module manufacturing, Yingli has gone through tough times. So with all of this talk from Suniva about dumping and cutthroat markets, it doesn’t seem to be limited to US cell manufacturers. Global manufacturers are in the same boat and only those that have the become more efficient in manufacturing can make it. Take a look at the computer chip market. How many manufacturers make up the top 80% of market share? And then compare that to the solar module market.
The Energy Storage Road Show is moving forward now scheduling the week of June 5th in Los Angeles!
A Budget to Forget. Later this summer, Congress has to either pass a budget or go for another continuing resolution to keep the Government open. Last month, President Trump said a shutdown may be required but assuming that doesn’t happen and Congress passes a budget for the first time in a really long time, Trump is looking to cut clean energy budgets dramatically.
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Yann
This is your SolarWakeup for May 17th, 2017
Are Yieldcos making a comeback? CEO and data whiz at kWh Analytics has a unique view of our solar industry. He chronicles the rise, growth and fall of the yieldco environment with a preview of what is yet to come. There may be less yieldco businesses but maybe that can lead to more success with specialty sponsors. A good read and interesting point of view.
Virginia Wants to Lead. We finally find out what is really going on at Monticello! Terry McAuliffe is making a play for a carbon cap. It is rare for Governors to propose ideas with specificity without a way to get to implementation and in Virginia the Republican party was quick to denounce the move. These goals are going to get reached regardless of the policy but as the market shows that ‘regulatory overreach’ actually matches up, people won’t be afraid of setting goals.
The Energy Storage Road Show is happening, starting May 22nd in San Diego!
Big Corporate Invests in Small and Early. It doesn’t surprise me that this headline is coming out, just surprised it hasn’t happened earlier. I pitched this previously because what better way to see what problems you have in your big company than looking for innovation in startups. Forget the upside of the investment, the upside in improving your company is potentially enormous. I challenge more large companies in the solar market to do this, plus it doesn’t have to be expensive. For a few hundred thousand dollars, your company can get great exposure to the next innovative idea.
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Yann
This is your SolarWakeup for May 16th, 2017
Fighting the Suniva Tariff Request. SEIA hosted a call yesterday to outline its opposition to the Suniva 201 petition. First, Suniva has to speak for the industry, in this case the segment of solar that manufacturers crystalline PV in the US. SEIA is stating that it does not, on the basis of Suniva’s market share being less than what has previously been accepted by the trade commission. Furthermore SEIA contends, rightfully, that a few manufacturing jobs are not worth saving at the cost of losing a trove of jobs in the downstream part of the market. What SEIA left out in my opinion was the cost to the consumers and taxpayers. For every penny that modules get more expensive, consumers end up with higher cost of energy, solar or otherwise. Solar drives the cost of energy down across the board and increasing that cost hurts hardworking American families. Moreover, the tax credit remains on the books. As we drive the price of systems up, taxpayers will end up giving higher credits than needed. Last tip to SEIA, let’s not use the phase loan guarantee and US solar manufacturing in the same sentence again.
All in on solar. Good things are happening in Nevada as the net metering bill continues to go through the Assembly. Having previously released the bill from any deadlines, the bill has been passed by committee overwhelmingly. Now, with an important negotiated change, net metering rates and caps have been outline for years to come.
The Energy Storage Road Show is happening, starting May 22nd in San Diego!
Lyndon Rive is out. Lyndon is leaving Tesla in June. It is surprising because no one was thinking about it but it doesn’t seem strange. What else would Lyndon have left to do at Tesla? Even if Elon goes full time to living on the moon or building tunnels in Los Angeles, Lyndon wouldn’t be the CEO of Tesla. Last year, I found a picture of 2007 SPI booths and one of them was Lyndon standing at SolarCity’s 10x20 booth pitching residential solar. Like the model or don’t, SolarCity changed the game in many ways. Best of luck to Lyndon.
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Yann
This is your SolarWakeup for May 15th, 2017
The Chink in the Utility Armor. I interviewed the legislative leader behind Florida’s Amendment 4, Senator Brandes. The news in the interview came from our discussion about what’s next for solar in the Sunshine State. Senator Brandes understands the value of solar and the benefits of having a known 30 year price structure, something that cannot be offered by fossil fuel plants. In our conversation we talked about the strength of the Florida Utility Monopoly and how the consumer’s choice for fixed pricing and clean energy could be the chink in monopoly armor. The Governor is now ready to sign the bill that Senator Brandes helped push through the legislature potentially marking the beginning of the solar renaissance here. Of note, Senator Brandes is the most conservative member of the Florida legislature as rated by the Americans for Prosperity.
Wholesale Power Markets. As we enter an era of low cost centralized solar, storage and end of life fossil assets, we have to broaden and redefine power markets. Solar plants will always produce energy at the same time, naturally increasing available energy and lowering the cost of marginal energy in the market. The markets should start looking at how storage at all levels, central, substation and behind the meter, can be the replacement for fossil stations at the end of their lives. Replacing plants with new central fossil doesn’t make much sense in most areas, time to create the right price signals.
The Energy Storage Road Show is happening, starting May 22nd in San Diego!
Mexico, week after MIREC. Every year during and shortly after MIREC, Mexico becomes the next big market. Having overseen some development in Mexico, I have to say it was a long road and it surely isn’t easy to be patient to cross the finish line. This MIREC was probably different because the market now has some big solar already built and under construction. So hopefully for everyone working on solar in Mexico, here is to the takeoff of your market.
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Yann
This is your SolarWakeup for May 12th, 2017
Have a great weekend and don’t forget to email me if you are interested or working on storage in California. My solar + storage road show starts May 22nd. New Podcast on Monday that is amazing because I spoke with the most conservative State legislator in Florida.
Chinese manufacturing. Suniva, SolarWorld, and TenK Solar have all had issues in recent weeks and all blame cutthroat Chinese pricing on the issue. First, I wouldn’t be surprised if Chinese manufacturing has gotten really good at solar and savings are coming from the supply chain as opposed to dumping and cheap labor. Second, while the pricing has dropped more than I ever thought possible, would the companies really be in better shape if pricing was double what it is today?
Fixing competitive markets. IPPs are complaining about markets across the Country. I agree that we need more price signals and more value for quick response energy or energy that matches up to the location of the load, like air conditioning in the summer in Texas. Keep listening to the IPP CEOs because this is going to be a thing.
The Energy Storage Road Show is happened starting May 22nd in San Diego!
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Yann
This is your SolarWakeup for May 11th, 2017
SolarWorld goes Insolvent.The German parent company of SolarWorld US has filed for insolvency. A few things to consider and trust me, I don’t have any of the answers. As a publicly traded company in Germany, the standard for directors to have to file is a much lower bar than in the US. The company has been in financial turbulence in the past and must now try to restructure itself again. No statements or reporting has thus far made clear if the US entity will have to take any action or what this means for the operations here. What is likely to happen is that buyers of product will become more cautious going forward due to the financial uncertainty. One thing to note, the European markets have had a minimum price for several years and yet, this result happened. It should be clear to Commerce staffers in the US that a minimum price has not worked in the past and will only harm consumers across all markets.
Trade Questions. I don’t understand the trade cases well. I am not sure what the minimum price means, how it could or would get negotiated down from the 78 cents per watt and when it would start. Here are questions that I would want answered if I was currently running a solar company. If a minimum price is put in place, could any of my orders for modules be retroactively taxed? Who would have to pay that tariff? Would the minimum price increase the margin for imported modules? Wouldn’t this be worse than a tariff which creates a pool for local manufacturers to reinvest into new production? What has happened thus far to the tariffs collected from the first trade case? Who did it go to and how did it help?
The Energy Storage Road Show is happened starting May 22nd in San Diego!
Interesting NRG Reports. In one move, NRG could create a massive renewable energy company. Reports say that activist investors in the company are asking for the renewable energy assets to be sold off. NRG Yield is 5GW on its own plus any of the ongoing projects being added to a potential sale. So the question is, does an existing investor come in and acquire the projects or is this a perfect entry point for a private equity player to finish what NRG started?
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Yann