With the solar industry chaos of 2018 behind us, many of us are looking toward more predictable growth from 2019…at least until the Investment Tax Credit goes to zero for residential and 10% for commercial on December 31, 2021. Then again, we’re on the solar coaster, so it is unwise to be complacent about a rosy solar future — or the broader economy, for that matter. Here are my 10 predictions for 2019.
1. Inflation will hit residential solar installations hard
2. Good software and communications are the price of admission for future solar and battery systems
3. Supply chain issues with battery storage systems will persist
4. With a recession looming, financing will become even more important
5. U.S. solar manufacturing will continue its downward slide
6. PUCs will force utilities’ hands when it comes to grid reliability
7. Despite headwinds, batteries will continue their slow march toward 50% penetration
8. As pilot results roll in, uptake of VPPs will increase
9. Upgrades and maintenance will emerge as a key opportunity
10. Stubborn soft costs will impede further drops in residential solar prices
As I wrap up these 2019 comments, I am humbled by Yogi Berra’s advice: “It’s tough to make predictions, especially about the future.” Nevertheless, I am confident in two key elements of our industry: We are doing the right thing for the global environment, and the economics of solar-plus-storage remain superior to any other energy source. I remain optimistic that — regardless of the next plunge in the solar coaster — our industry will continue to thrive over the long term. Please listen up to this Week’s Energy Show for the details on these 2019 Rooftop Solar and Storage predictions.
Attention U.S. Department of Commerce: your well-intentioned efforts to help the U.S. solar panel manufacturing industry are not working.
Even with 30%+ tariffs on imported solar panels and cells, the remaining U.S. manufacturers are struggling to stay competitive. The good news, as one would expect, is that there is strong demand for Made in the U.S.A. solar panels – both from ordinary consumers as well as government purchases. However, structural issues with the supply chain for solar components puts the remaining U.S. manufacturers at a substantial disadvantage.
The reasons for these supply chain challenges are simple. Basically, many of the key components that go into solar modules are not manufactured in the U.S., including wafers, cells, EVA and junction boxes. And many of the components that are indeed available in the U.S. — such as glass, backsheets and aluminum frames — are significantly less expensive at comparable quality levels if purchased from overseas suppliers. To make matters even worse, these essential imported solar components are subjected to additional tariffs when imported from certain countries. Essentially, we are shooting ourselves in our foot if we expect U.S. solar manufacturers to be competitive when 30%+ tariffs are applied to most of the major solar components.
A rational plan to make the U.S. competitive in solar manufacturing does not require government support. Instead, it requires government to get out of the way and set a long-term solar manufacturing policy. U.S. manufacturers would instantly be more competitive if they did not have to pay tariffs on imported solar components — particularly cells and aluminum solar frames. Once the U.S. solar manufacturing base is re-established and consistent, U.S. manufacturers could invest in domestic wafer, cell, junction box and other component manufacturing.
How are U.S. manufacturers coping with competitive global issues of cell production and purchasing, U.S. production costs, cell and panel tariffs, local and federal regulations, and shifting national policies? The best way to answer this question is to speak with one of the most experienced U.S. solar panel manufacturers. My guest on this week’s show is Mamun Rashid, COO of Auxin Solar, based in San Jose, California. Auxin manufactures high quality poly and mono solar panels for residential and commercial customers. They also do original equipment manufacturing for tier-1 manufacturers who have “made in the USA” requirements. Please listen up to this week’s Energy Show for Mamun’s perspective on the opportunity and challenges for companies manufacturing solar panels in the U.S.
Success in the solar industry requires leaders with a diverse skill set. Leaders must really understand the technology’s evolution, be effective with sales and marketing, coordinate what always seem to be chaotic operations, juggle financial issues and manage a growing team. I’m always interested in learning from people who have this diverse background — and have demonstrated success in the solar industry.
One of these executives is Todd Lindstrom, CEO of Enable Energy. Todd and I go back to his time at Sun Power and Geothermal Energy circa 2004. Since then he’s been at Solar Power Inc., Sharp Solar, and Paramount Energy Solutions. He is also manufacturing very clever mounting solutions for flat roofs that we are using at Cinnamon Energy Systems for many of our flat roof projects.
Join us on this week’s Energy Show as Todd discusses innovations that are changing the way the industry installs commercial rooftop solar — as well as his solar installation business at Enable Energy.
Some people just love riding the “solar coaster” – both the exciting up times and the death-defying plunges…usually from some totally unexpected outside force. It’s great to hear from industry veterans who have managed to thrive through both good times and bad.
Our guest on this week’s Energy Show is Jeff Brown, one of the most experienced solar contractors in the business. Jeff got his start in solar back in the ‘80s with solar thermal installations, he and I worked together at Akeena Solar, and now Jeff is at the cutting edge of battery storage technology at JLM Energy. Jeff has also been an active board member at CALSEIA, and has been one of the leaders in the transition from solar thermal to solar PV.
Please join us on this week’s Energy Show for Jeff’s candid insights into the factors that are reducing the benefits of rooftop solar — which then are leading to the next phase (spoiler alert: energy storage) of the rooftop solar industry.
The “climate” for solar is most favorable when there are high electric rates and incentives. For these reasons the PV industry grew fastest on the west and east coasts. Now that prices have come down and incentives have extended throughout the country, solar is taking off in Midwestern states, too.
Indiana has been one of the standout solar states in the Midwest. Indiana’s combination of retail net metering, RPS and tax credits spurred the creation of a vibrant solar industry – even larger than the state’s natural gas industry. But as with other states, incumbent utility competitors began to crack down on Indiana’s emerging solar industry.
Nevertheless, a number of savvy solar installers are continuing to thrive in Indiana. My guest this week is TJ Kanczuzewski, President & Chief Executive Officer of Inovateus Solar in South Bend Indiana. Please Listen Up to this week’s Energy Show on Renewable Energy World as we talk about TJ’s experience founding Inovateus Solar, their focus on government policy to help evangelize and ultimately shape the solar industry; and how the company’s core values have shaped Inovateus as they continue to achieve market success.
Over the past few months we’ve experienced a solar eclipse, several devastating hurricanes, another under-construction nuclear plant shutdown, and a backwards-looking Department of Energy Grid Reliability study.
The performance of our electric grid during the eclipse demonstrates how well a flexible, well-managed grid can handle predictable events. These severe weather events show how vulnerable our electric grid really is, how dependent we as a society have become on electric power, and how valuable some form of backup power is for homeowners. The nuclear plant shutdown clearly shows that nuclear power cannot compete against cheap natural gas.
Weaving these circumstances together, one could come to the conclusion that the electric grid of the future should be more modular (distributed); could effectively rely on a combination of wind and solar and storage; and could take advantage of smaller, high efficiency gas turbines for peak afternoon power demands and night-time power. Not only would this grid of the future be cleaner and cheaper, but it would also be more resilient to local weather and human-caused disruptions.
Solar contractors and homeowners are not at 30,000 feet debating fundamental energy policy and grid strategy developments. Instead, they are on the ground in need of inexpensive electricity and backup power when the grid fails. If you are interested in practical solutions to these problems (sorry, I have no way of rationalizing the DOE’s Grid Reliability Study), to achieve grid reliability, Listen Up to this week’s Energy Show on Renewable Energy World.
Millions of Americans were using cereal boxes, telescopes, and flimsy plastic solar viewing glasses to witness the Solar Eclipse on August 21. But for workers in the solar industry — as well as homeowners and businesses who are considering rooftop solar – an eclipse of the solar industry itself looms on the horizon.
The International Trade Commission (ITC) will be deciding in September whether or not to place tariffs on imported solar panels. Since virtually all solar panels are imported, the tariffs they are considering will effectively double the price of standard solar panels. In advance of these proposed tariffs, almost all available inventory of solar panels is being purchased by large installers. As we learned in economics 101, when demand goes up and supply is constrained, prices increase. Indeed, prices for popular rooftop solar panels have already increased by 20%.
The tariff issue being considered by the ITC is complicated. On the one hand we want to build a robust U.S. solar panel manufacturing industry – which employed about 2,000 people at the end of 2016. On the other hand we want to continue the strong job growth in the entire solar industry – which employed 260,000 people at the end of 2016. Since the vast majority of U.S. solar workers are focused on installations, increasing the price of imported solar panels is likely to cause overall solar employment to decline for the first time ever.
A decision to implement tariffs or other penalties on imported solar panels is likely to be made by President Trump towards the end of the year. It is my hope that his decision carefully considers ways to continue growth in the solar industry, while at the same time developing a long-term plan to improve U.S. manufacturing. For more about the upcoming ITC case and its implications on the solar customers and the industry as a whole, Listen up to the Energy Show on Renewable Energy World.
With much higher volume manufacturing, prices for solar panels have come down tremendously over the past 20 years — from about $1,000 each to less than $200. But solar panels are still very time consuming to install on a roof in a way that will last 25+ years without leaks. The majority of this rooftop work is on the flashings, roof hooks, and special roof mount components.
A few companies specialize in manufacturing solar roof mounts. As a solar contractor I like to try out new products in an effort to reduce my installation costs while still maintaining high quality installations. One of the leading roof mount companies is SolarRoofHook, with offices in Livermore, California and Rock Hill, South Carolina.
My guest on this week’s show is Rick Gentry, Executive Vice President at SolarRoofHook. Over the years Rick has been instrumental in developing new roof attachment products that are both reliable and easier to install. Please join me on this week’s Energy Show on Renewable Energy World as Rick explains the ways these roof mounts prevent leaks through the roof, the corrosion-proof fasteners that are used, and key considerations that homeowners and contractors should keep in mind when selecting roof attachment products.