This is your SolarWakeup for January 5th, 2020

Losing Money Redefined. If you buy a house and you make that mortgage payment every month, your checking account balance goes down. Would you consider that losing money? The money that the bank invests in you by providing that mortgage, is that money lost by the bank? If you were to read the New York Times article below, you would get the sense that Sunrun and Sunnova are losing hundreds of millions. In reality, their income statements have always been misunderstood by reporters because every dollar that goes into a solar project results in another 20 year contract that generates cash flow. There will come a time when the cash flow from those assets will generate more cash than the companies are investing and there will be GAAP EBITDA but even then it’s a dumb argument and I’m annoyed that the New York Times can’t report this accurately. Solar shouldn’t be made to be a bad investment by the pre-eminent newspaper in the Country, editors need to do better.

Will Government Contract Fast Enough? Biden is set to take the reins and he’s spoken at length during the campaign about government contracting. It is true that the military and GSA are enormous energy users spending billions for electricity and I hope that they are part of the solution. We need a project warp speed at the GSA and DOD to enter into PPAs for on and offsite renewable power purchasing. This can’t drag out and bureaucracy can’t get in the way this time.

Oil, Gas And Coal. If you’re an oil executive, where do you focus in the next 4 years? You’re losing your market share to EVs, so how do you play that? The harder question is for the gas executives, who are looking at their coal colleagues and see the writing on the wall.

Expanding Portfolios. Gibraltar, which trades publicly as $ROCK, has acquired Terra Smart to add to its portfolio alongside RBI Solar. Making portfolios of solar manufacturing companies is going to build great investments. Congrats to the team.

Consolidate Your Power. As you walk back into your offices (remote or otherwise) you will realize that the conversation is about what isn’t available. Modules, inverters, wires, tax equity, labor and other core requirements are in high demand and short supply. On product supply look towards consolidating your purchasing with similar companies to maximize your access and keep your pricing competitive. We’d be happy to give you more information at the SolarWakeup Buyer’s Group. 

Opinion

Best, Yann