Tag Archives: Daily Rundown

This is your SolarWakeup for March 31st, 2020

Tracking Survey. This morning I am joining Roth Capital on a conference call with investors to discuss the results of the past two week’s tracking survey. If you’re interested in the results from this week, fill out your responses today. This takes 60 seconds and provides feedback about the market and legislators looking to see what to focus on. Link. 

Trouble In Texas. Oil companies are having issues keeping their businesses afloat. This comes due to a double dilemma of Coronavirus and OPEC’s price slashing. Oil prices are down dramatically and oil companies want a bailout in the form of a major purchase by the federal government and likely more.

Setting The Stage. The problem with the bailout, a $3billion purchase adding to the strategic petroleum reserve, is that Congress needs to approve it and didn’t include it in the last stimulus bill. Much like the 2016 ITC extension which was traded for the oil embargo lifting, democrats in Congress are calling for solar to also get support alongside oil. 

Op-Ed Battles. Kevin McCarthy and Newt Gingrich are trying to counter the negotiation from a position of political minority. They are claiming that industry support is being held up by radical requests for a green new deal in time of crisis. Don’t fall for this, just last week the EPA is using the pandemic as an excuse to relax environmental standards and rollback of regulations that protect the environment.

Political Reality. Now is the time to stay in touch with your member of Congress and give them the details of the issues facing your business. Tell them what an ITC extension, grant in lieu and inclusion of storage means to you as a solar professional. You want them to make solar support a non-negotiable, especially in this time of crisis, not in spite of it. I don’t doubt that oil will get their handout and more, solar is doing good work and keeping folks working.

Be Aware. CISA, a federal agency, released a memo that clearly states that solar is a critical sector. See it here. 

Opinion

Best, Yann

This is your SolarWakeup for March 30th, 2020

Discussing The Market. Join me tomorrow in a discussion with Roth Capital’s Philip Shen about the SolarWakeup Tracking Survey results. If you’re interested in joining and reading Phil’s excellent coverage of the solar universe and public solar companies, email him at pshen@roth.com.

Adjusting The Forecast. WoodMac released an adjustment to the 2020 forecast for distributed solar. Their belief is that the 2020 forecast needs to be adjusted down by 31%, likely putting 2020 down from 2019. The public analysis doesn’t differentiate between residential and commercial but my view is that this is conservative and assumes a total shutdown for 4 months. The data we are seeing in our surveys and conversations with the market is one of resilience. Yes, 2020 won’t be 25% growth from last year but solar installers are finding ways to continue selling and using self-reliance as a purchasing motivation. We’ll get more into remote sales over the next few surveys and how you are adjusting the forecast.

Building Department Insight. Last week’s tracking survey showed a potential problem in the market with building departments closing. On the other hand, there has been a lot of talk about FaceTime inspections and email permitting so let’s see what the rest of you are seeing. So in this week’s tracking survey, we ask a few questions on the topic as well as updating the week to week changes. Respondents to the survey get the full data summary in advance of the rest of SolarWakeup subscribers. Click here to participate.

The States and Cities. Here is some reality to everyone in every industry. Cities and States are fighting the pandemic which is costing them money in addition to focus. Unlike the federal government, these bureaucracies can’t print their own currency and don’t operate at a deficit. In fact, they will have to raise debt or tap into emergency pools. This means that solar and renewable goals will take a backseat to the current emergency. My hope is that in package 4 stimulus, Congress includes aid to the local level in some form (treasury debt perhaps).

Preview Of Climate Change. Not to be alarmist but you’ve seen the climate change headline about mass migration or release of gases from the permafrost. Yes, this reads like a Dan Brown novel but there are some scary thoughts of what a global climate change event looks like. Our work is as important as ever, keep up the optimism and energy!

Opinion

Best, Yann

This is your SolarWakeup for March 27th, 2020

Sales Continue To Slow. As expected, this week’s SolarWakeup tracking survey shows that sales have dropped compared to pre-corona levels. Installers say that sales are down 33.5%, a deterioration from the 25% reduction our survey showed last week. Anecdotally, a few installers are seeing an opportunity in the market due to their online or telephone based sales process. Installers that relied less on the face to face sales tactics are seeing minor increases in sales volumes.

Installers Prep To Tough It Out. Door to door sales have stopped across the board, with no installer reporting business as usual. With the backlog of projects keeping some installation crews operational, 62% of the installers have already or plan to terminate employees. Next week, we will test this given the loan forgiveness passed by the Senate this if employees are retained.

Another Barrier Arises. While most companies across the country (and many of the respondents) have transitioned to the Zoom economy (including my children and their teachers) building departments were not prepared for not being able to process digital permit sets or inspections. 24.1% of the installers are seeing delayed inspections and 44.8% report that some or all of their building departments are closed. Even if installers are able to sell projects right now, unless building departments move online (touches permitting) projects will wait for things to normalize.

Trade Group Support. Thanks to memos by groups like CALSSA, joining today would mean a lot, installers are considering themselves essential or critical in order to continue installations. 68.9% of them are doing so with over 50% officially labeling themselves as essential.

Survey Results. This week’s survey included responses from 74 companies whose primary markets spanned 20 states. Included in these companies were 29 residential solar installers. Responses spanned from March 23rd to March 26th.

Market Chatter. In discussions this week, companies are saying that they have had record attendance on webinars and software companies are able to guide installers, developers and companies through the digitization of their processes. There are bright spots in the market as the underlying reasons for solar’s success continue to exist.

Next Week. Look out for next week’s survey which opens on Sunday afternoon, as you can see the data is helpful to your business and respondents got many more data points than this short summary. 

Opinion

Best, Yann

This is your SolarWakeup for March 26th, 2020

Building Departments. Over 60% of this week’s survey respondents say that building departments are either closed or delaying inspections. There are also talks about departments not taking new applications because they aren’t taking hard copies. Just as there is a time to start selling remotely this is also the time to do digital permitting. Instant permits will allow solar to recover from this standstill while also give building departments the process to overcome the current situation. SolarAPP was already in the works in an orderly fashion, I hope that the process and pilot cities is drastically sped up and expanded in light of the current times.

$2.2 Trillion Dollars Unlevered. Honestly, I don’t want to talk about it. In the biggest economic stimulus and bailout by a factor of many, solar didn’t get what it tried to squeeze in. The political gamesmanship was interesting between Schumer and McConnell. Schumer’s leverage was the money needed for the strategic petroleum reserve purchase and pushed for the tax credit extension but it was McConnell’s elevation of the solar ITC that got even solar professionals to think industry went too far at the wrong time. The bailout left the ITC, 1603, storage, safe harbor out with the hopes getting pushed to the next bill, stimulus package #4. This time it wasn’t enough, hard to believe with the trillion dollar price tag.

But Wait. Couple of things to watch, there’s some talk that treasury could be asked to reinstate the 1603 program without new legislation, lawyers were quick to through cold water on that idea however. Late yesterday, Trump signaled that he would find the money for the oil purchase for the SPR by reassigning funds from the Department of Energy. This removes the biggest leverage point in stimulus #4 if Trump is successful. 

Opinion

Best, Yann