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.
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Yann
This is your SolarWakeup for March 25th, 2020
Last Day. This week’s survey ends at noon today, head there now and you receive full results tomorrow in a special email. Link
Sell From Home. My FaceTiming comments from yesterday reconnected me with my good friends at SolarGraf. They have some experience and best practices on how solar installers can sell remotely from start to finish. The company is sharing some of those in a blog post and hosting a webinar today as well. Head to the blog if you want to get some of their tips. I’ll share others when I get them. Link
A Deal In The Senate. Forget billions, we’ve graduated to trillions. Early this morning, a handful of Senate negotiators came to terms on the $2trillion stimulus package (#3). At this point the only language that we know of is around small business loans and industry grants/loans plus unemployment benefits. At the time of this writing, there is no word whether the ITC is in this bill. Insiders are hedging success for this bill and more optimistic about ITC being in package #4. What, for how long, with what conditions will all be known when words actually meet paper. No point in being first here, this all takes time. Look to the Senate to vote today and see if the House has to travel back to DC (they’re on recess) if someone objects to unanimous consent.
My Optimistic View. From a market standpoint, solar companies were way too oversold and I got myself back into the market over the past few days. It could go down further but these valuations are more than fair. My position is that years from now the market will be exponentially bigger, better and more mature than today. I’ve been in solar for over 15 years and I feel better even today than ever before in this market. Things are tough but they are tough for everyone, when we come out on the other side of this societal wide crisis, homeowners will want solar on their roofs and farmland. They will want cleaner and cheaper electricity, the fundamentals will not have changed. My future is in this market, no matter what.
Welcome To SolarWakeup. The past few weeks have brought a large number of new subscribers, welcome to the SolarWakeup family. You can reach out to me anytime at yann@solarwakeup.com or contact me on LinkedIn. Like most readers, I work every day in the solar market (selling innovative racking to solar installers) but this platform is a community to works together for the betterment of the solar industry.
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Yann
This is your SolarWakeup for March 24th, 2020
Be Heard. Participate in this crucial survey, this week’s data is showing a large disparity between what is going and where. Maximize the data by joining in.
Trackable Market Data. When coronavirus first hit the US I knew that I wanted to track sentiment and sales on a weekly basis. From sales to install we also have permit data which is usually not tracked in real-time. The best data source for this in the US is my friend Chris from Ohm Analytics. Ohm Analytics has leveraged its data sources and capabilities to track solar activity on a weekly basis. Ohm is providing access to this feature for the time being to help the industry navigate the next several months. Ohm's Weekly Solar Activity Tracker will monitor solar permit and other available records in a sampling of the largest cities and counties in major solar states. This is a major data tracker that Ohm is making available for free for now and should drive you to subscribe to their fuller data set or sign up as a contractor. Thank you to Ohm for making this happen and letting SolarWakeup show it to the market.
A Bill Today? Late last night, negotiators appeared to get closer to a deal in package 3. This package is nearing $2TRILLION dollars and whether the solar ITC is part of it is up to a handful of people. In case you are wondering if it’s part of the discussion, just ask McConnell. He had some choice words about solar.
Are You Facetiming? I want to talk to solar installers still selling but without meeting their customers face to face. Do you have a unique approach or concept? I want to hear about it.
The Essential Industries. In California, many of you asked me about the various orders from County and State officials and where solar installers fit in. The state rules around essential and federal definitions of critical sectors leave room for interpretation, which is why we have strong trade groups like CALSSA to provide guidance. In their well crafted memo, they lay out clear language for you to use for your business. Keep in mind, stay safe and use your judgement, this isn’t a free pass to act like all is normal. While you’re here, representing solar industry isn’t free. If you benefit from California solar and storage policies, join CALSSA and let them know I sent you!
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Yann
This is your SolarWakeup for March 23rd, 2020
Tracking Corona’s Impact. Here is this week’s tracking survey for you to fill out. This is for everyone in the solar industry and it takes 2 minutes. If you fill it out, you get the full set of results. Please take the time and share it with your colleagues as well.
ITC In Play. Over the weekend I sent a special alert and you responded. No link in SolarWakeup history got clicked on more and you forwarded almost 10,000 times to friends and colleagues. Your involvement could mean the difference for solar as Congress addresses a stalemate at the Capitol. The Politico story will be stale by the time you see it but stay tuned to see if solar gets included in the 3rd stimulus bill coming out, likely today. Topping over $1.5Trillion, hard to fathom solar being left out.
Managing Your Business. The CEO of Soligent posted a well crafted powerpoint on things to consider as you run your business. I think Jon makes some important points and it’s worth your time to review his recommendations. At this moment, it’s crucial we all absorb as much information and advice as we can. These are uncharted waters for all of us.
Looking At The EV Future. A bright moment coming out of the shutdown is we get to see what the future looks like. Around the world, pollution is down and dolphins are swimming in the clear waters of Venice. In Los Angeles, there is a clear reduction in pollution in the air, likely caused by the lack of cars. Hence our need to convert to EVs as soon as possible, no cars and EVs are basically the same when it comes to pollution especially when combined with a 100% RPS.
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Moment Of Levity
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Yann
This is your SolarWakeup for March 20th, 2020
Survey Results, Installers. Installers are reporting that closed sales are down 25.1% from their weekly average in Q1, still operating at 74.9% close rates.
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Yann
This is your SolarWakeup for March 19th, 2020
The Permit Problem. According to the SolarWakeup tracking survey, 44% of installers are seeing building department close or delay inspections due to COVID-19. It is understandable that the situation is happening and at the same time an opportune time to talk about how solar should be permitted. Solar permits should be automated and instant, we already have the software tools at our disposal that create the drawings installers need to follow in order to build code compliant solar. If the software were vetted by a building department or state regulator, as long as the installer followed the plans, they should be able to build the system right away. Inspectors could choose to video conference the inspection with the installer or spot check the system at a later date, if the installer fails to do it correctly they would be thrown off the instant permit system and risk losing their license. If there was ever a time to create a digital bridge between solar installers and AHJs, the time is now.
Solar Is An Essential Business. There is a reason that solar installers need to be able to keep working. While sales will transition to remote, phone and video calls, installations are safe to proceed without contamination risk. Imagine if this crisis was happening in a few months when the risks of wildfires start back up? Just yesterday there was a major earthquake in Salt Lake City. Solar installers across the Country are adding solar and storage that make homeowners self-reliant and eliminate the risk of power shutoffs for at risk population. It is crucial that solar continues to install safely while maintaining social distancing. In the Bay Area, most of the counties have put a shelter in place order in force that excludes essential businesses. For me, it is very clear that solar is and should continue to be able to work in order to allow the preparation for wildfire season to continue.
The Problem With The Data. Most of us are feeling a level of uneasiness that we have never felt before, I feel it too. With three kids at home, and the prospects of no school for the next 5 months, I don’t know what happens from here. Here is my biggest problem with all of this, we need bigger data. In this vast country of 300 million people we have 60,000 people tested and 8,700 positives. That’s a terrible data set to make decisions on, for our country, society and industry we need to make the right decision based on the right data. If it means we have to shut everything down for 30 days, so be it but let’s stop messing around without knowing the facts.
Thank You. The first SolarWakeup tracking survey was a success. The results will be published tomorrow and every Friday from here on out. On Sunday each week, you will receive a link to the next survey and I hope more of you decide to participate going forward. Knowing what is happening in the market will get us to a point where we can speak with data to politicians on how they can help us through this troubled time. More to come.
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Yann
This is your SolarWakeup for March 18th, 2020
One Last Chance. Here is the link to this week’s tracker. This survey gives us the baseline, thank you for everyone that already filled it out. At noon today, the survey will close. Responders will get a preview via email tomorrow.
2019 Year In Review. Hard to think about 2019, but it was a record year for distributed generation across the County. Solar grew 23% from 2018 even in the face of tariffs. Residential solar had an impressive 2.8GW and would have absolutely crushed the 3GW in 2020 and may still do so. Community solar, waiting for its major growth year still achieved 500MW in 2019. There is a note in today’s rundown that talks about retail buyers being a key demo in solar, this is what will grow the community solar segment as well. Remember that non-residential includes C&I as well as community solar.
SEIA Comments On Corona. The forecast in the 2019 year in review makes a disclaimer that it does not include any impact by corona. In a separate statement, SEIA said that the 47% growth forecasted will be ratcheted in the coming months as we know the impact. Abby Hopper says it will be a “pretty significant crisis in the solar industry in addition to a significant crisis in the overall economy.”
Is Solar Contrarian? GTM found a gem in the Q4 Sunrun earnings call. On the call CEO Lynn Jurich said that solar may work better in an economic downturn and I agree with her rationale. Assuming the cost of capital, underwriting and liquidity remain in the market and competitive, solar will be able to continue. The only counterpoint, which was hard to predict, is that solar companies that overly rely on selling face to face will have difficulties and need to adjust to the short term changes.
Utility Shutoffs. Almost unanimously, utilities will suspend cutting offer power for non-payment during corona.
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Yann
This is your SolarWakeup for March 17th, 2020
Testing The Impact. The only way we can understand the depth and duration of the coronavirus impact on the solar market is to track the four markers: deals signed, loans closed, permits approved and projects installed. Through the SolarWakeup survey tracker and partnerships with key analytics firms, we will guide you through this. While I can deliver the data, I can’t make it up and your participation is key. We need the collective us to share information so that the data becomes most useful. The goal is to deliver weekly analytics in a way that helps you adjust your metrics. For example, when you have the first good week after the lull, is it just you or the entire market? If you see others are also doing better, you will feel more inclined to get back at it at full strength. That’s the goal, isolate quickly and then get back after it. Here is the link to this week’s tracker
Cities Shelter In Place. You may have heard that cities in and around San Francisco have a public health order to shelter in place. The headline is underpinned by details that are important to the solar industry. Let me preface with, if you can do your job from home, please do so for as long as you can. There is an exclusion for two purposes, essential businesses and minimum business operations for which necessary employees can continue working while maintaining safe distances to stop the spread. For Bay Area solar installers with a backlog of solar plus storage systems, it is up to you to determine the importance you play in advance of the wildfire season. My point is that solar will not stop because the Bay Area is working from home, our work is essential to the future of this Country because while corona may be the now problem, climate change remains as important as ever.
Bullish On Solar. Before the market opens today, there looks to be a nice bounce after yesterday’s massive drop. Losing over 12% and reaching the all-time high on the VIX yesterday, I see positive signs on the horizon after we get through some difficult times. The solar names have been beaten down, some of them trading at 50% of the price of a few weeks ago. Here’s the question you want to ask yourself; 5 years from now, will there be more solar installed on homes, buildings and farmland or less? If you agree with me, get ready to get invested because I’m bullish on solar.
Bailouts Are Coming. The airline trade association is asking for $25billion in grants and $25billion in zero interest loans while the casinos are also in DC ringing the bell. Their direct line to the White House prompted a Trump tweet, “The United States will be powerfully supporting those industries, like Airlines and others, that are particularly affected by the Chinese Virus. We will be stronger than ever before!” I’ve got some asks to attach to the bill.
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Yann
This is your SolarWakeup for March 16th, 2020
Social Distancing. Before we get into the headlines and solar market, let’s take a step back to recognize the gravity of the current situation. Now that it has reached the pandemic levels and changed everything about our everyday lives, we realize that what we do in normal times relies on a level of stability that currently does not exist. In the hopes of getting back to normal as fast as possible do your part and stay away from others as much as possible, there are plenty of infographics that show you what happens when people isolate and stop the spread of the virus. Not only will things get back to normal you will likely help save some lives at the same time. If you need some additional pressure of what happens when the ‘flu’ spreads across the globe, read this 1997 piece by Malcom Gladwell about the Spanish Flu.
Let’s Track The Delays. Like everything in the economy right now, there is going to be a pause to growth as people stay home to isolate and stop the spread of COVID-19. With the longer cycles of utility scale and C&I to be less affected by the short term, SolarWakeup is going to track any slowdown that may occur. This survey is meant for residential solar installers given that is where 60% of the solar jobs sit and there are weekly/daily sales, loan closings and installations. This will give us a tracking view of the market and provide the feedback we need to make our business decisions. Please take 5 minutes and fill out this survey if you are a residential installer, if you are not an installer please send it to a few that you know. This is the network effect of data that helps us all. Here is the link.
The Positive Outlook. While the CDC has asked for society to stop gathering in groups greater than 50 for the next 8 weeks, I look at the positive. 8 weeks is achievable and we should look at this in a positive way. The CDC could have said longer and there may be a few weeks coming up where we’re asked to stay home altogether. The solar market was going to grow by over 25% this year, which means that ever losing 8 weeks would mean we can rebound and catch up. With the fed rate dropping to zero, we may see better rates for solar loans across all market segments creating opportunity to scale everywhere. I’m optimistic that we will do the right thing as a society and come out ready to do big things.
Let Solar Help. Many of you may be going through business hurdles through this pandemic. I can’t promise that we can help everyone but let me speak on behalf of the industry that if there are issues or questions that are hurting your business, please let me know and I’ll do my best to advise or put you in contact with someone that could be helpful. My email is yann@solarwakeup.com.
The Survey. Don’t forget to participate in the survey and please share this tweet to get it out as much as possible.
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Yann
This is your SolarWakeup for March 13th, 2020
Pre-Corona Survey. Here are the highlights of the market survey released this week, answers coming between March 10th-11th. Respondents ranged from installers (35%), manufacturers (15%) and developers (25%). You covered every market in the Country with half of you doing business in California but MA (45%), NJ (38%), CT (31%), FL (27%) and AZ (27%) were also represented.
Q1 Improvement. While 25% of you saw no improvement in Q1 over last year, 55% of respondents were up in the first quarter over last year.
The Corona First Take. This is where timing of the survey is important. All of the responses came before March Madness, NBA, NHL, MLS and little league games were canceled due to the pandemic. 62% of the answers said that coronavirus had no impact on your Q1 sales and 48% said that you are not adjusting the Q2 forecast. My assumption is that a survey next week would have different numbers. 39% of you are adjusting the forecast by 0-20% downward.
What You’re Doing. Many of you shared with your actions in anticipation of which the most two most common were: no travel and work from home. Some also highlighted that society will now learn to wash hands once again. I’m interested to learn what companies are doing across the industry to manage their business through the crisis and if there are any changes to the economic business model of the sector. Please take your time to send your ideas and concerns to yann@solarwakeup.com, together we will manage through this.
Looking Ahead. There are going to be more questions than answers over the next week while the world settles into the reality that the virus is spreading everywhere. Without being hysteric, the way to solve the spread or flatten the curve is to isolate for as long as possible. Expect companies to have as many people as possible working from home while doing their best to keep moving business forward. I will circulate another survey next week and check the pulse of the industry. Typically I look to have podcast interviews that have some longevity to them but I will likely do a few interviews on this topic in the coming weeks to give you critical information for your business.
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Yann