Does The House Pass It? The resentment for the lack of consideration in crafting the infrastructure bill is starting to show in the House. The noise that’s coming isn’t just from Pelosi but it seems like there could be real pushback from the democrats that they wouldn’t pass the bipartisan bill without the reconciliation also in tow, moreover that bill would have to do real work on climate change or risk being turned down as well.
Tesla Storage Sellout. Tesla is sold out well into 2022 and indication from Elon is that Megapack, their utility solution, is going to have create “significant unmet demand” going into 2023. Keep in mind that Tesla is not only using the battery cells for their megapack but also for a plan to build 20,000 powerwalls per week and of course their non-stationary power, their vehicles. You’d have to presume, and I say this with some knowledge, that the powerwall (resi solar/storage) market is going to be much more appealing for the company than the utility scale storage market which is filled with demanding infrastructure investors that want to carve up the contract and pick and choose the software solutions to align with their trading strategies.
CA Mixed Signals. California has some tall climate goals and challenges but when it comes to solving them with actual market policy, regulators seem more keen to be solving political issues than dealing with climate change. Aside from taking a strong view on net metering, their licensing board is voting to stop solar installers from installing behind the meter energy storage. Stay tuned for more updates from CALSSA on the topic and join the association if these issues impact your business.
Big Money On What? As private equity raises a seemingly endless pot of money for the energy transition and ESG investments, there are two apparent paths to deploy that capital. First is to invest into the infrastructure itself where the return expectation are directly tied to the risk associated with the project (contracted, credit and production exposure) and the second to the platforms that enable that capital to be deployed. It’s the latter that is very interesting to me because this used to be undervalued in the market, but as many of us know it’s the margin of the capital formation and the execution of those projects, i.e. the where the money is made.
- Utility Dive: California PUC unveils draft plan for ‘forward-thinking’ distributed energy policy
- Energy Storage News: Tesla deployed 1.3GWh of energy storage in Q2 2021 with ‘Megapacks sold out to 2023’
- Axios: Private equity giant TPG Capital raises $5.4 billion for new climate fund
- PV-Tech: California Community Choice Aggregators sign contracts for 778MW of renewables and 118.75MW of storage
- Politico: ‘Tiger of the House’ claws his way through infrastructure talks
- Solar Power World: Oregon officially commits to 100% clean electricity by 2040
- PV-Magazine: 250 MW solar project proposed in Wyoming
Opinion
Best, Yann