This is your SolarWakeup for June 17th, 2021
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Yann
This is your SolarWakeup for June 16th, 2021
Summer Days. Many of you are on vacation and we’re trying to take it a tiny bit easier here at SolarWakeup too. So over the coming weeks, pardon our brevity on some days and enjoy the outdoors. It’s sunny out and we’ve got a solar spill to clean up!
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Yann
This is your SolarWakeup for June 15th, 2021
Infra Drama. The latest headline is the GOP mulling a bipartisan approval of the infrastructure bill in the $900billion range and assuming that the Democrats can’t get the moderates to pass anything else by reconciliation. Insiders tell me that the ITC is likely to remain as part of the core infrastructure bill even though many of the headlines about climate change policy speak to that portion getting pushed to the second bill. The climate change portion includes the national RPS which has garnered some negative feedback from Senator Manchin and others.
Lorde’s Solar Power. SolarEdge isn’t the only group that can make a solar song. If Lorde wants to get real about solar though, headlining CALSSA’s Battle of the Bands is the only place to do it.
Heat Wave Headlines. We’ve highlighted the impacts of heat waves over the past few months and we’re about to see the grid get put to the test and how assets respond. We’ve had a year of record DER and front of the meter energy storage additions, whether they are properly used and compensated will determine future build rates.
Paywalls. More publications are adding paywalls, which I don’t have a problem with. I will continue to post stories from those publications and leave it to you whether you become a subscriber or not. The alternative is to reduce the number of stories on the daily newsletter which would also have the negative effect of not driving your eyeballs to good reporting that you may want to support.
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Yann
This is your SolarWakeup for June 14th, 2021
The G-7 Summit. Leaders from the G-7 met in the UK this weekend and climate was a central point. The big headlines came in around transportation and competing with China in supporting developing nations with infrastructure investments that align with climate goals. Australia’s presence in the room made any joint statement around coal difficult but as we talked about in the past, that ship has sailed. The group did make bold forecasts on fossil fuel cars, eliminating subsidies for fossil fuels and expanding foreign financing to match policies abroad.
A Note About Capital. The communique labeled the support to the tune of $100billion per year. That number is completely meaningless. What governments need to focus on is creating a bankable environment for the development of the projects that they are looking to be built. Allowing for streamlined zoning and permitting and access to revenue streams would create the path for the trillions of ESG capital, in all currencies, to get involved. Policies not headlines would rule the day here.
Markets React To Price Signals. National Grid wants FERC to do more for grid stability and I say that all the RTOs should figure out how to create a deeper market for the price signals that create a stable grid. Ancillary services are in the market but can lack trading volume that saw the frequency response market in PJM lose a build signal a few years ago. Part of the solution is creating a more dynamic market with shorter time spans potentially, allowing for trades to happen far more often that they do today.
Hot Price Signals. California is starting to see the warm weather and a message from the grid operator to expect shutoffs raised the price signal. A long summer ahead.
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Yann
This is your SolarWakeup for June 11th, 2021
Have A Great Weekend. Keep your eyes on the news coming out of the bipartisan talks for the infrastructure bill. See you on Monday!
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Yann
This is your SolarWakeup for June 10th, 2021
First Solar Grows. First Solar announced that they are expanding their manufacturing plant in Ohio by 3.3GW. This will be the 3rd plant in Ohio and will start manufacturing in 2023. First Solar is doubling down on the domestic manufacturing advantage they have, in part due to the supply chain differentiation the company has. If only the Ohio legislators saw the ability to create local policies that would enable First Solar modules to gain a market within the surrounding areas of this job boom.
Oil Majors, Look Out. Last week came the results but this week the oil majors are pivoting into the PR push by investors and outside influencers. We’ve covered multiple times that I see the oil majors are looking at electricity as a transportation fuel replacement and will be getting into the generation, transmission, trading and retail sale. This marks the start of the future competition between utilities, IPPs and oil majors.
It’s Real. In case you wanted to know if storage markets were expanding, they are and they will continue to grow.
Soft Costs. It’s shaping up to be a big summer for soft cost reduction with the launch of SolarAPP and with continued innovation from the leading solar software companies. OpenSolar, today announced a partnership with the largest US design and engineering firm GreenLancer, connecting OpenSolar’s highly regarded 3D design and sales toolkit with the on-demand planset generation service reportedly used by over 5,000 contractors. With OpenSolar bringing experience from its users in over 100 countries, Birchy and the new US team I know are focused on supporting US installers to drive down costs (Australia remember is at $1.10 per W residential cost all in, with 25% solar penetration). They launched their ‘Opportunity Wide Open’ summer series today, in which they’ll share a range of resources and tips to help solar contractors reduce cost and scale. There will be a lot of approaches but good to see partnerships in technology creating savings for the solar community.
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Yann
This is your SolarWakeup for June 9th, 2021
Q1 Storage Grows. The acceleration in pipeline, backlog and construction within energy storage is real. With 2020 showing the signs of a grid looking for additional ancillary services and consumers adding behind the meter storage, 2021 continued to build on this with rapid expansion of generation+ and stand alone storage. The Texas winter storm in February showed the need for frequency regulation which is likely to be seen again this summer in western states suffering from record droughts.
Report On Solar Forecast. kWh Analytics and 12 contributors published the Solar Risk Assessment report which shows that the P99 estimates for production (P99 meaning that this should be accurate 99% of the time) are not often actually modeled accurately. The report also goes into detail about the degradation estimates for modules and the issues that are affecting the module quality.
Green Hydrogen Targets. Los Angeles and the Department of Energy made news with green hydrogen yesterday. After a decade of targeting record solar costs which were surpassed ahead of schedule, DOE is taking their talents to hydrogen. A note of history, my first solar module supplier was Uni-Solar, a division of Energy Conversion Devices and one of their science project divisions was solid state hydrogen fuel storage for the automotive sector and the corresponding fueling systems. Like many items at ECD, I don’t think this was every commercialized but a note of intersection for our readers.
Soft Costs. It’s shaping up to be a big summer for soft cost reduction with the launch of SolarAPP and with continued innovation from the leading solar software companies. OpenSolar, today announced a partnership with the largest US design and engineering firm GreenLancer, connecting OpenSolar’s highly regarded 3D design and sales toolkit with the on-demand planset generation service reportedly used by over 5,000 contractors. With OpenSolar bringing experience from its users in over 100 countries, Birchy and the new US team I know are focused on supporting US installers to drive down costs (Australia remember is at $1.10 per W residential cost all in, with 25% solar penetration). They launched their ‘Opportunity Wide Open’ summer series today, in which they’ll share a range of resources and tips to help solar contractors reduce cost and scale. There will be a lot of approaches but good to see partnerships in technology creating savings for the solar community.
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Yann
This is your SolarWakeup for June 8th, 2021
The Solar Market Update. Today at 11am Eastern, I join Phil Shen of Roth Capital (subscribe to his newsletter), for our monthly resi solar market update. We’ll be talking about supply chain, financing, policy and of course, storage. You can register at this link.
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Yann
This is your SolarWakeup for June 7th, 2021
The Drought And Effect. The west is dry and while we all hope for the best, there are already worrisome signs of wildfires and lack of water for agriculture. The energy effect will be more power shutoffs than before and a grid that consumers will consider unreliable. Grid planners have not adjusted any major items to ensure new infrastructure is built out but if I were still living in California, I’d be making sure my solar and battery were ready for primetime.
Low Capacity Bailouts. Expect to see more bailout legislation coming out after the low capacity clearing price in PJM. Nuclear operators will be legislating towards ZREC policies that provide a kicker for their plants but always opens up opportunities to get a broader energy package passed.
SolarAPP+ Thanks. It has been a village to get SolarAPP+ to where it is today and there are many people that are integral to this process and without ignoring everyone’s efforts I want to call out one particular person. Andrew Birch, a co-founder of Sungevity and current co-founder of OpenSolar, first pitched me the idea of instant/uniform permit policy over 3 years ago on his patio in Alameda. He’s been tenaciously cheerleading the effort and getting the biggest names and companies in the solar business to spend time, money and sweat on the effort. I told him then that it would be an uphill climb, and some of you emailed me when I first brought you the idea agreed that it was crazy to think this was possible. So for having the willpower to bring an idea to fruition against all odds without ever asking for credit, here’s a token of appreciation from me.
Will Manchin Deliver? Joe Manchin remains unpopular but very powerful and in some ways is taking the infrastructure bill on his shoulders to bring a bipartisan support of the bill to reality. We’re getting very close to seeing whether he can deliver the votes and give Biden the bipartisan win his 47 years of government would assume he could get.
The Solar Market Update. Tomorrow, I join Phil Shen of Roth Capital (subscribe to his newsletter), for our monthly resi solar market update. We’ll be talking about supply chain, financing, policy and of course, storage. You can register at this link.
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Yann
This is your SolarWakeup for June 4th, 2021
New Spending, No Tax Increase. Biden and Senate republicans are going back and forth on the infrastructure bill which will be massively popular with voters. Biden looks to give in on tax hikes as long as republicans agree with $1trillion of new spending. Senate dems are putting up a 10-day shot clock before making their case for doing it by reconciliation. Solar advocates say that ITC extension looks solid but issues around labor and domestic content remain, though outcomes appear workable.
Climate Warning Signs. Two independent transactions with high-profile names are getting into climate event prediction and analytics. I guess knowing that your house will flood before it floods can be considered a valuable data point. This also marks TPG’s Rise Fund’s first major investment announced since former Treasury secretary Hank Paulson joined the fund as executive chairman.
AB 1139 Defeated. This was a bad bill doing bad things that are completely counter to the market and climate goals in California. Moreover, legislation that undermines existing market rules would create a new risk analysis in solar that would have impacted all parts of the ecosystem. Led by CALSSA and it’s 600+ members plus allies, advocates came out and maneuvered the opposition to victory.
Talk About Capital. I’ll ask this on a high level with a promise to talk more about it with you in the near future. Solar and wind investors look for stable returns on contracted cash flow with conservative assumptions for tail revenue post contact term. Energy storage can play a role for solar+ contracts but what capital pool will be an investor in the merchant storage assets and how will a stand alone storage ITC get a tax equity deal done? Same pool of capital but higher hurdle rates or different capital all together?
Enjoy your weekend!
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Yann