Below are some headlines from around the internet over the past few days. I'll include references soon. Enjoy!
Financing
Q4 2016 marks the first quarter since 2011 that more residential solar customers chose cash/loans than lease/PPA’s to finance their solar panels. “The end came in the fourth quarter of 2016, when only 47% of new residential solar installations were leased or operated under owner-purchase agreements (PPAs), according to new research from GTM Research. That’s the first time in six years that the portion of third-party solar had dipped below 50% in the residential sector.” Nicole Litvak (Senior Solar Analyst) “contends there were two reasons for the shift: SolarCity and California. First, SolarCity’s acquisition by Tesla has created a new dynamic for the company. Tesla reported that 28% of SolarCity’s fourth-quarter deployments were purchased by the customer, and Litvak speculates the number was even higher in the residential sector. “Despite SolarCity’s declining market share, the company still accounts for about one quarter of all residential solar installed,” Litvak wrote. “Any major changes to its strategy will have an impact on the market – and we’re already seeing that impact.” Second, the decrease in solar leases and PPAs was even starker in California. According to GTM, only 36% of new residential installations. While the state’s small installers have always preferred handling owned systems, the move of some of the national installers like SolarCity, Sunrun and Sungevity to cash deals have accelerated the trend even more quickly.”
PACE financier Renovate America has been paying off delinquent customer loans to improve portfolio characteristics before securitizing loans without disclosing it to investors. Renovate America claims to have funded $1 billion in residential loans last year.
PACE financier Renew Financial expects to finance $1 billion in residential loans in 2017 (~$200 million of which will be solar).
Policy
Arizona Public Service (APS) reached a settlement with solar industry over net-metering in their territory of Arizona. They agreed to provide a higher net-metering rate than originally sought after and pay $0.129 per kWh. However, this compromise only helps with the short term for residential solar customers in Arizona. The recent state-wide rate designs that increased the frequency of changes to net-metering rates and shorter evaluation periods for the benefits that solar provides will still dampen the long-term proposition of residential solar in AZ when it is not coupled with a home battery.
Technology
Rocky Mountain Institute and Grid Singularity are partnering up to push blockchain technology into the energy space. “Blockchain, the technology underpinning the Bitcoin (http://www.vox.com/explains/2014/4/23/5643382/how-bitcoin-is-like-the-internet-in-the-80s) virtual currency, is being discussed as one of the most potentially disruptive technologies since the internet. Blockchains are a combination of information technology, cryptography and governance principles that enable transactions to occur without the need for a third party to establish trust between transacting parties. In today’s transactions, a number of human processes and institutions -- such as banks, lawyers, regulators, brokers and utilities -- are paid to establish trust. Blockchain technology replaces these institutions, making it possible to conduct transactions without a third-party intermediary. To unlock this value and help accelerate blockchain technology development in the electricity sector, RMI and Grid Singularity (http://gridsingularity.com/) -- an Austria-based blockchain technology developer -- formed the Energy Web Foundation (http://www.energyweb.org/) (EWF). EWF is a nonprofit foundation with one high-level goal: to unleash the potential of blockchain technology in the energy sector. To achieve this goal, EWF focuses on defining blockchain use cases, building a blockchain platform for the energy sector, incubating an ecosystem of stakeholders, and educating the public.” Right now: sharing the data necessary to bring a multi-directional grid is challenging with regard to privacy and security, energy related programs (i.e. renewable energy credits) are expensive and inefficient to run, only sophisticated businesses or those with large amounts of capital can purchase power from independent power producers for off-site power, and redesigning the purpose of the grid from a centralized and one-way system are barriers for an energy revolution. Blockchain can solve all of these problems.
Manufacturing
Brookfield Asset Management, Inc. plans to acquire both of SunEdison’s yeildcos. They plan to purchase Terraform Global outright and solidify a 51% interest in Terraform Power as well. This news comes after a lengthy process in court with bankrupt SunEdison.
Yingli formed a special committee to strategically reevaluate their crushing debt structure. “The ailing module manufacturer, which was last month threatened with delisting from the New York Stock Exchange, is forming the committee with the ultimate of aim of resolving debt repayment issues faced by its principal subsidiaries... Yingli has not set a timetable for the committee to complete provide recommendations, nor has it given any guarantee that the board of directors will authorize the pursuit of any alternative that is recommended. After posting profits for 2 straight quarters, the first it had seen since 2011, amid the Chinese installation rush in 2016, the drop o in demand set in and Yingli’s losses passed US$50 million in the third quarter of last year.”
Somewhat Unexpected
***Sonnen now offers free electricity to Australian customers who own their home battery system. “Just months after launching its residential battery storage offering onto the Australian market, Germany battery maker Sonnen has flagged the introduction of a household solar and storage deal that threatens to disrupt the traditional retail electricity model. The deal, called “Sonnen flat,” offers free power to households using the company’s integrated solar and storage system, including for any electricity drawn from the grid when the sun goes down and stored energy is used up. In return, Sonnen has access to its customers’ installed battery storage capacity to use as a sort of virtual power plant, to provide grid balancing services to network operators – most of the time, without any discernible impact at the customer’s end… Meanwhile, Sonnen starts to look less like a battery business and more like energy retailer, with any losses incurred by giving customers free power more than compensated for through revenue made on the balancing power market – known in Australia as Frequency Control Ancillary Services, or FCAS – where prices are higher than in the regular markets.”
For those who remember that residential batteries are potentially going to be illegal to place in homes in Australia, Sonnen Australia’s CEO, Chris Parratt, replied “Ours is a very, very safe battery. In Europe, we have 30,000 installations and some of those have been around since 2010, and not one fire has happened, no one has been injured. Germany has proved that they can be safe.”
Thank you for reading,