This is your SolarWakeup for January 30th, 2020
PG&E Story Gets Interesting. One year ago I wrote that the PG&E bankruptcy was a political move by the monopoly that would try to back the newly inaugurated Governor into a corner. Yesterday, while the company was in bankruptcy court, the Governor found his voice and said that the monopoly either comes out a different company focused on being the safest, cleanest and cost effective utility of the future or the State would take over. About damn time and good for him! This is an opportunity to build a better utility, a monopoly is a gift by the consumers and it’s time it aligns its goals and execution with where the State wants to go.
The Climate Tech Era. I don’t think that Axios’ reporter Dan Primack is off directionally that VCs are still hesitant when pitched by clean tech companies. There is a shift in the weather though, climate tech is now a thing in Silicon Valley. It’s being talked about at the biggest venture firms, on Kara Swisher’s podcasts and in angel investing networks. Investors are also seeing capital being raised by startups and investors like TJ Rodgers and John Doerr being successful with their investments in recent times. Founders that were successful in non-climate startups are coming into the investment space with a focus on climate tech.
24/7 Renewables. Corporate PPAs are largely disconnected from the geography or use profile of the company. You can imagine corporate renewables in a 3 phase approach. Step 1 is buying enough RECs or actually contracting for the same amount of electricity that you are consuming on a cumulative basis without regard to where or when you are using the energy. Step 2 is procuring those credits within the same transmission system as the energy consumption, i.e. in the same geography. The last step is actually matching the geography and the timing of consumption, where and when it is being used. If you can’t colocate the consumption with the generation, this is the ultimate step in corporate procurement.
Don’t Hate The Game. I have’t gotten into the details of the Tesla earnings but I have some thoughts on the polarization of the company/Elon. First, the stock was training up about $70 from where it closed after hours, nearing $650 per share, well over $100billion in valuation. Second, no matter what you think of Elon, the company is mission aligned with my goals in the solar space. Building electric vehicles and using the scale of battery manufacturing to also scale battery storage in their solar unit. Without much marketing, from what I can tell, Tesla installed over 50MW last quarter. So maybe you can hate the player but don’t hate the game.
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Yann
This is your SolarWakeup for January 29th, 2020
In Person Wakeup. Come see me next week at Intersolar in San Diego and in Boston in a few weeks for Solar Power Northeast. More commentary tomorrow right here on SolarWakeup. In the meantime, we will be relaunching The Wakeup Podcast in a few months with exciting new guests, send your ideas for interviews and storytellers across!
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Yann
This is your SolarWakeup for January 28th, 2020
The EV Solar Overlap. With another auto OEM announcing a major investment in EV and autonomous vehicle manufacturing, you may ask yourself what the overlap is between the solar and auto sectors. There are two important intersections between us that will make solar a central player in the growth. While EV owners tend to never go back to traditional vehicles, the adoption of EVs by new consumers is slowing, even flattening. Quite simply, consumers are scared of something they don’t know how it works and don’t know where to start. Dealerships are not the best place to go because most sales teams don’t actually have an EV. BUT, homeowners that go solar are much more comfortable to try an EV and with the solar contractor most likely showing up in one, they also know who to ask questions to and get a charging plug installed at their home. Not only does the solar contractor create the path to EV ownership, it also breeds the consumer comfort you need for new technology adoption. Large scale solar also makes the EV future much cleaner. Buses, cars, and even garbage trucks will be electric and that drives electric load growth which has to be met with new renewables matching the load profile.
GreenRock Future. BlackRock is getting more attention for its renewables investments off their CEOs letter about sustainable focus. This isn’t new but it is growing in both scale as well as breadth of investable markets beyond the traditional solar and wind markets.
A Sober Look At Davos. Joel Makower of GreenBiz has a unique and fresh view of how sustainability was discussed at Davos.
Why States Matter. New Jersey has been moving their market forward, not without change, but in a way that takes stakeholder experience into account and making the market continue its leadership position. This is why the solar industry continues to rely on the leadership at the state gubernatorial and legislative level.
Speed Translation. The outgoing CEO of BP says that oil majors should not act too fast on climate change because their is technology risk. Translation: BP needs to get more cash out of the ground in quarterly earnings before realizing that it hasn’t been able to execute in the renewables market.
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Yann
This is your SolarWakeup for January 27th, 2020
My Amazon Idea. Like other tech companies, employees at Amazon are pushing their leadership to do more to fight climate change. Here’s my idea. Amazon has a way of getting consumers, myself included, to search, browse and click to buy very quickly. I would like a second buy it now button, color it green. Every product has a carbon cost embedded in it including the transportation related carbon debt. Let me click the buy it now price that pays for that carbon debt, a voluntary carbon tax if you will. I don’t know if people will do it or what the right carbon price is, experts and testing will tell us if it would work but I think that I would pay the extra dollar or two to quickly do my part.
The Existing Portfolio. The right battery price was always going to make this a reality. With the 10s of GW of solar capacity already in place in America and more around the world, owners of those assets will be adding storage to every solar plant. There will be hardware improvements and more importantly the need for power markets, off takers to adapt to this. It will also need project owners to determine if they want to reopen their contracts for negotiating the addition of storage.
Listen To The State Chapter. Arizona’s SEIA chapter has ideas for how their utility can meet their goals that were announced and the same is true for other state solar trade associations. Utilities and regulators alike should be working with these groups and their members to advance the ball on this important topic.
24. We do important work every day and many of us do it to improve the lives of those around us. No matter your role, remember that we need to work just as hard to be present in the moment. Kobe was the best at what he did in his moment and now the expectation for a bright and present future is gone.
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Yann
This is your SolarWakeup for January 24th, 2020
Sunrun CEO Speaks. Lynn Jurich gets the corner office treatment from the New York Times, conducting an interview to talk about her as a person and leader of the largest residential solar installer in the Country.
SEIA CEO Speaks. In an interview with Bloomberg, Abby Hopper talks about the ITC step-down, politics of solar and the opportunities that exist in the market.
Market Speaks. Thinking about the commercial distributed market, a market that has been struggling to find a real footing, it may be possible that storage creates a real certainty on value for the investor or business owner. What’s next for this space, especially the unrated portion of it, is what could create the largest solar opportunity in history of the US market.
EV Fleets Will Speak. The future of EVs and all the tangential markets it includes will require robust policy advocacy. The Corporate Electric Vehicle Alliance will kick off the effort.
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Yann
This is your SolarWakeup for January 23rd, 2020
Utility Activism. APS, the Arizona utility, announced a target of carbon-free by 2050 with some intermediate targets. Their CEO said “We don’t actually know how to get there right now,” which says a lot considering that solar plus storage is at record prices and Arizona consumers would be more than happy to do their part by putting solar and storage on their homes.
What Groups Say. Both SEIA and SEPA were quick to put out comments about the announcement. I was saddened to see that the statements were congratulatory in nature without pushing for more open access or firm technology outlines. In fact it is hard to differentiate the statements between the two groups when there should be. Solar, not smart, energy is going to be the way this gets done for APS consumers and other utilities around the Country. Giving that brand away without debate is bad marketing on our part.
Guess The Source. Here are the two statements. See if you can distinguish them, it shouldn’t be hard but it should be a lot easier. Note that neither makes reference to the consumers. “A number of major U.S. utilities have made commitments to carbon-free by 2050, but Arizona Public Service stands out in the crowd. While any carbon reduction commitment is laudable, APS is among the very small handful of utilities that have coupled their commitment with an aggressive but reasonable interim target and specific actions that demonstrate meaningful progress." "The commitment that utilities are making to clean energy is reflective of plunging costs and a much stronger business case for going #solar."
Money To Make It Real. Two groups that have been in the news in the past week are back at it by committing money to the cause, in different ways. BlackRock has backed European Climate Finance Group to build on their project portfolio, this is capital that isn’t novel but the timing makes last week’s shareholder letter backed by action. The other capital commit is from Microsoft, fresh off their carbon negative goal. The Carbon Negative Fund is capitalized at $1billion for carbon capture, reduction and removal technologies. Let’s see what they get into.
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Yann
This is your SolarWakeup for January 22nd, 2020
Tres Commas. Bloomberg is highlighting some success stories in the ‘green’ sectors. Solar has been an industry where people have done well but we don’t have a solar billionaire as of yet. Who will it be and how will they use that wealth to advance the industry? If you think you can be that person, come on the podcast.
Green Coffee. Starbucks announced their headline carbon initiative, to lower their emissions by 50% by 2030. Unlike tech companies, I find their path much more complex given their distributed footprint and shear quantity of waste and plastics. That being said, their transition to non straw tops happened very quickly so maybe the company embraces change along with their customers. Knowing that the outcome is the right thing to achieve, I look forward to learning how the company executes and how solar plays a role. Maybe this is an interesting solar hot water integration.
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Yann
This is your SolarWakeup for January 21st, 2020
Schmoozing In Davos. The World Economic Forum starts today and climate change is going to be a central topic. The conversation between JP Morgan’s CEO, Jamie Dimon, and BlackRock’s CEO, Larry Fink, should go something like this. Climate change is a real problem but can you believe that we get to invest trillions of dollars to solve this for the world? Coal plants are not investable anymore and unless a regulator will guarantee a double digit return, I won’t even invest in a natural gas plant. The only thing worth anything on those plants is the interconnection so we can put giant batteries there.
In Reality. This is clearly the investment thesis that others are seeing. Bay Area VCs are hailing climate tech as the trillion dollar opportunity as well. On the other hand, we have’t gotten to that point yet, the conversations in Davos will be more scientific which isn’t necessarily a bad thing so that folks can be educated on the situation. That education will let deals get to the point of being seen. Once they are seen, investors will see the economic case without needing the environmental influence to say yes.
Without The Markets. One of the key regulatory intersections to deploy the capital into projects is the lack of open markets. Advocates are playing by the rules to try and make these markets more open but they are in a fight against well run monopolies that know not to give an inch. From a political standpoint, it creates a catch-22 for politicians that either want to see more renewables or those that favor free market capitalism.
What’s Next. What else do you want to see from SolarWakeup? Different type of content, events or medium? What has been published from this platform that you want to see more of? In the mood for some feedback and community brainstorming.
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Yann
This is your SolarWakeup for January 20th, 2020
Mops And Buckets For Climate Change. Building a wall around Manhattan drew the ire of Trump on Twitter, get your buckets ready New York.
Tech Helps The Fight. We’re entering an era where action has a technological and financial capability of success. Here’s Jeff Bezos showing off the new electric rickshaw that Amazon will use in India.
The Trade Deal. Phase one of the trade agreement with China was signed last week, amongst which was promising outlook for the silicon sector. As details come out, there will be plenty of opportunity to assess how this could help the solar space. It does leave in place all other tariffs on solar related items like inverters, aluminum and other commodities.
Looking Ahead. A few weeks ago, SEIA elected a new board Chair. In a quiet contest between Swinerton CEO, George Hershman and Nexamp CEO Zaid Ashai, the board elected Hershman. The Swinerton CEO has been a leading voice in tariff fights which leads the expectation that SEIA will continue to focus a large amount of time and resource on the topic. It has yet to be seen or heard how SEIA plans to move forward after the ITC loss including the discussion on the next step-down at the end of the year. I continue to wish and hope for SEIA to do public outreach to groups that could view this election as a double down on utility scale solar, away from DG and the regulatory policies that enable that segment.
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Yann
This is your SolarWakeup for January 17th, 2020
Social Media Action For Reefs. Former Miami Dolphins player, Jarvis Landry, caught me by surprise when his post included a call to action on climate change as it pertains to reefs. A new level of action for climate that solar should think about.
Two Investments, One Deck. Union Square Ventures is a well known, successful, early stage venture capital firm. This is a firm that did part of the series A for Twitter in 2007. Two new investments and 60 slides on why they are looking at climate tech as part of their thesis.
Forget Carbon Neutral. Microsoft is challenging its team to get to carbon negative by 2030, a leap from the carbon neutral goals set just a few years ago. Making this possible for its millions of customers would be a great next step. Here is their post outlining this.
We Knew. “Yeah, we knew. Everybody knew,” he said. “And somehow we all ignored it.” Those are the words of Shell CEO Ben van Beurden.
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Yann