This is your SolarWakeup for May 6th, 2021
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Yann
This is your SolarWakeup for May 5th, 2021
24 By 7 Procurement. Corporate renewable energy purchasing is headed to the next phase and it is going to impact ecosystems across the market. Corporates have reached their 100% renewable energy goal and now going to the time matching of procurement and usage. Google Cloud is announcing that they are partnering with AES to buy renewable energy matched to their usage. This is a little fish in a big ocean way to do it but here are two things that will happen next. Data centers will go first, not only those that are exclusive to big corporates, but data centers that are providing services to companies will have to match renewable energy to their consumption in order to retain their customer base. Second, renewable energy generators will have to learn to shape their curve. Imagine having to reengineer the 8760 forecast based on the consumption curve of the off taker. Careful though, missing your production could mean having to go to the market to make up the energy and leave you naked on the hedge.
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This is your SolarWakeup for May 4th, 2021
May The 4th. May the force of all the regulatory, policy and market tailwinds be with you. EPA is back to protecting the environment from greenhouse gases.
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Yann
This is your SolarWakeup for May 3rd, 2021
Capital Deep Dive. There are some important things to note in this deep dive by BNEF about the global capital to project pipeline. The energy transition, centered around the goals pledged to by economies around the world, is going to take north of $50 trillion (with a t) and even then will allow for the allocation of $2-3trillion per year. Their estimates have it at $2.1trillion this year alone. There are three items that I want to highlight and get you to think about. A few years ago, the CEO of an oil major said even if he wanted to invest $10billion into renewables, he wouldn’t find that scale in the market. That has changed and create the inverse problem. Large investors like majors and pension funds are going direct to the pipelines and not looking to trade those assets once they’re in the portfolio. The lack of trading is noted by BNEF and makes the value of platforms higher than ever before (and I note that the value of the platforms used to be less than zero just 5 years ago). Lastly, let’s realize the scale of the capital appetite and what it will take to credibly deploy it for long life assets. That means that not only do the investment platforms need to do the work well, the companies that are hired to build, procure, integrate and maintain those projects are vital to the ecosystem.
And Now You Know. The entire previous paragraph is why companies like FTC Solar are going public, Enphase, Shoals and Array are valued at 100x earnings with Nextracker and Loanpal filing their IPO docs.
ICYMI. I spoke about our role in helping develop the energy storage pipelines across the energy sector in this coverage.
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This is your SolarWakeup for April 30th, 2021
Does Storage Work? For your project. I had the pleasure of talking to Andy Colthorpe of Energy-Storage.news about the most common question I’ve been getting since joining FlexGen. Asset owners and developers alike are looking for answers on how storage creates revenue upside and capital deployment opportunities on their existing assets, pipeline and future developments. Regardless of the interconnect, storage has a role and a timeframe for the right return on investment. By doing a project feasibility assessment, you identify the target revenue situation and the corresponding capex maximum based on your return requirement with the ability to actually get the project done if the project gets the green light. Thank you to Andy for the article and Solar Builder and Solar Power World for their coverage as well.
The Congressional Address. Good coverage in a variety of publications about climate and how it made the primetime in Biden’s address to Congress. Politico’s Greenwald takes a contrarian view to the climate policy is jobs policy in today’s rundown.
Permits Cost Time Cost Money. It’s been 3 years since I first mentioned the idea of instant permits on this newsletter. While the concept has not changed much, permits take too long and cost too much for the service they provide to homeowners, the reality of instant permits has reached much higher probability and in some jurisdictions, reality. There are a few people, one in particular, that have been relentless advocates for SolarAPP. In due time they will get recognized in a major way on this platform, but everyone involved in residential solar should be paying close attention to how they can help this effort.
Power Up, EPCs. And come ready to learn! The Business PowerSeries from EagleView - moderated by yours truly - has an upcoming webinar on scalability. Remember what happened when Icarus flew too close to the sun? This session will show you how to avoid any sinking missteps and instead scale your business using sustainable strategies. I’ll be joined by JP Gerken, CEO of Zenernet and solar selling extraordinaire. He’ll talk about what it takes to turn a business into one of the largest residential solar companies in the country. Sign up now to save your spot for May 12th!
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This is your SolarWakeup for April 29th, 2021
It’s Tracker Day. FTC Solar has successfully gone public, joining the public markets and trading under the ticker FTCI. The original price target was $19 per share but the sale actually happened at $13 per share. The company raised a little over $130mm for the company balance sheet and some more shares were sold as a synthetic secondary. The stock did trade up to almost $15 by the end of the trading day, still representing a 7x revenue market cap.
What’s Next? You’ve been reading about it here for months and it finally happened, Nextracker, the global leader in single axis trackers, has filed for their IPO. The S-1 is still confidential but expect to see revenues well north of $1bb and margins comparable to Array Technologies. This would be the fourth tracker IPO in less than 12 months and bring the largest to the market. Nextracker is led by solar industry vets Dan Sugar and Bruce Ledesma which makes me want to be a bystander on the road show. Currently the company is wholly owned by Flex. As a side note, it is entirely possible that Nextracker valuation exceeds today’s market cap of Flex which was ~$9bb.
Clean Supply Chains. SEIA is stepping up to help the market ensure clean supply chains as it pertains to the Xinjiang forced labor reports. The Solar Supply Chain Traceability Protocol is a set of guidelines designed to help solar companies meet compliance obligations and, importantly, provide customers with assurances that their solar products are free of unethical labor practices. On April 30 at 1:00PM ET, SEIA will host a webinar to discuss the new resources and explain how solar companies can put them into practice.
Power Up, EPCs. And come ready to learn! The Business PowerSeries from EagleView - moderated by yours truly - has an upcoming webinar on scalability. Remember what happened when Icarus flew too close to the sun? This session will show you how to avoid any sinking missteps and instead scale your business using sustainable strategies. I’ll be joined by JP Gerken, CEO of Zenernet and solar selling extraordinaire. He’ll talk about what it takes to turn a business into one of the largest residential solar companies in the country. Sign up now to save your spot for May 12th!
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Yann
This is your SolarWakeup for April 28th, 2021
More Tomorrow. I don’t know about you but I’m busier than ever. You all should feel free to pitch in by sending me a paragraph to be included in the newsletter. Don’t pitch your book, if you’re going to get onto the newsletter, make the content valuable, have an opinion and make a point.
Power Up, EPCs. And come ready to learn! The Business PowerSeries from EagleView - moderated by yours truly - has an upcoming webinar on scalability. Remember what happened when Icarus flew too close to the sun? This session will show you how to avoid any sinking missteps and instead scale your business using sustainable strategies. I’ll be joined by JP Gerken, CEO of Zenernet and solar selling extraordinaire. He’ll talk about what it takes to turn a business into one of the largest residential solar companies in the country. Sign up now to save your spot for May 12th!
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Yann
This is your SolarWakeup for April 27th, 2021
Bipartisan Energy Policy? I had missed this message from Kevin McCarthy, the GOP leader in the House and host to the most solar by district. Is this politics or a real change in policy?
Going Full Stack. BP is registering to become an energy retailer. The oil major has long been in the energy wholesale markets, often working behind the scenes for dozens of energy retailers across the country. In deregulated markets retailers are the customer facing sales and marketing companies while the trading desks, which need massive balance sheets, often look more like BP. Part of this could be the upcoming shift in transportation from fuel to electricity. The electrification of fleets and consumer cars means that BP can’t give up their revenue to other retailers or utilities. By being a retailer, you could see BP offering fleet financing, onsite charging infrastructure and the energy package to go with it. If you think this is too far into the future? Oil traders are already financing fleet electrification across the globe.
Clean Goals, Clean Peaks. The RPS policy has gained steam across the Country and Biden is talking about it as well. With all this talk about 24/7 renewable energy, look for another headline to take over, the clean peak standard. This is an RPS that matches renewables with the highest peak of energy consumption so as efficiency and distributed energy lowers demand, the clean energy production needs to match the new peaks. Get your energizer bunnies ready!
Power Up, EPCs. And come ready to learn! The Business PowerSeries from EagleView - moderated by yours truly - has an upcoming webinar on scalability. Remember what happened when Icarus flew too close to the sun? This session will show you how to avoid any sinking missteps and instead scale your business using sustainable strategies. I’ll be joined by JP Gerken, CEO of Zenernet and solar selling extraordinaire. He’ll talk about what it takes to turn a business into one of the largest residential solar companies in the country. Sign up now to save your spot for May 12th!
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Yann
This is your SolarWakeup for April 26th, 2021
It Was Climate Week. The week ended with the climate summit and a plethora of policy statements by Biden which most likely drowned out any global statements by other Countries. Let's take a look at what this decade long sprint to a better planet and cleaner economy would create.
Kerry Bets The Markets. Underneath all of the headlines is the Biden approach to climate policy, taking the whole of government approach. It is also expected that a quarter of the upcoming state of the union speech will be about climate change and creating jobs in the clean energy economy. Kerry is taking an approach of using diplomacy with investors as well. He rightfully realizes that trillions of dollars will be coming from the private markets to fill the gap left by government funding.
Bad Politics? Fox is already beating the drum on Biden and obviously on the recently filed Green New Deal. The question that comes up is whether Biden leaning in on the policy is hurting democrats chances in the mid terms. Polling shows that support for the spending and policy initiatives is bipartisan, but Fox News is isolating the requirement (fakely) that you will only be allowed to eat 4 pounds of meat per year.
A Climate Corps. A second bill filed by AOC and Markey is a federal climate corps with 1.5million workers to focus on the implementation of the steep climb ahead for us.
Power Up, EPCs. And come ready to learn! The Business PowerSeries from EagleView - moderated by yours truly - has an upcoming webinar on scalability. Remember what happened when Icarus flew too close to the sun? This session will show you how to avoid any sinking missteps and instead scale your business using sustainable strategies. I’ll be joined by JP Gerken, CEO of Zenernet and solar selling extraordinaire. He’ll talk about what it takes to turn a business into one of the largest residential solar companies in the country. Sign up now to save your spot for May 12th!
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Yann
This is your SolarWakeup for April 23rd, 2021
Happy Earth Day. I failed to say Happy Earth Day yesterday, so you get that today. As a bonus, you get this great pic from Colin Murchie, who left solar for EVgo, but had this event with Secretary Pete and Gina McCarthy alongside Cathy Zoi.
Nationally Determined Contribution. The big news from yesterday is President Biden announcing a national target of 52% reduction of emissions compared to 2005. The NDC is the comparable target to other Countries having made a similar timeline pledge to save the planet.
Tax For Tax. Senator Wyden filed a new bill which is similar to the budget proposal from Biden that replaces fossil fuel tax credits for more credits on energy transition infrastructure. Wyden is the chair of the Senate finance committee, so the bill is not without importance.
More Normal Than Not. Congruent Ventures’ Abe Yokell was the first clean tech VC I met in 2007ish. They raised another $175mm fund for their climate tech focused investments but here’s the great thing. Inbounds for climate focused deals is coming from all VCs, a climate focus is a profit focus.
Solar Water Conservation. Water is important and apparently also a great piece of real estate for solar panels. I used to see this market as ridiculous and niche but apparently floating solar may create a secondary benefit that make more sense than meets the eye.
Pipeline For Storage. You’ve been reading this newsletter for almost 9 years and I have had many roles over that time. As you know I am now the CFO of the energy storage integrator, FlexGen. As you think about how storage may work for your projects or have already determined that you are adding storage, let me know how I can be helpful professionally. We’re not everything for everyone but when it comes to making storage come to reality, few companies are as capable as the team I’ve had the pleasure of joining recently.
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Yann