Insights Newsletter #2
By Thomas Keller & Faith Foushee
Happy Friday!
Welcome to the second edition of the Solar Business Insights bi-weekly newsletter! We’re happy you’re here.
Stay up to date on the latest solar market trends, technology, policy updates, strategies, and more. We do the research on each topic and gain insights from solar professionals. Our goal is to provide everything you need to know about solar business, all in one place.
Each newsletter starts with a question we asked the solar business community.
Question of the week:
Q: Smaller Installers, what lenders are you using?
A: I recommend checking out Credit Human. They have the lowest fees I have found and has a special incentive for installers.
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Solar Market Trends
SolarEdge Technologies, SunPower, and Enphase Energy continue to warn solar companies about slowing demand in the U.S. The SolarEdge Q2 financial report recorded $991.3 million in revenue, due to success in Europe in both residential and commercial solar. Performance in the U.S. continues to struggle due to high interest rates and government policies.
On the other hand, there’s some positive news for global solar inverter companies. Demand for solar inverters is increasing due to electrification in rural areas and increased government policies for clean energy. Research forecasts the upward trend to continue with technology advancements and less expensive equipment. The global solar PV inverter market was valued $8.05 billion in 2022 and expected to be worth $10.8 billion by 2028.
The IRA has made a significant impact on the solar energy industry. The SEIA released a new analysis showing over $100 billion in solar investments in the last year. The report reveals remarkable expansion, increasing capacity to 668 gigawatts. This amount of energy is sufficient to provide power to every home east of the Mississippi River. The IRA has several years to go before expiring, and will continue to influence customers in solar buying decisions.
Regulatory Updates
The USDA extends its Empowering Rural America (ERA) program with $9.7 billion in grants and loan funds to support development of renewable energy systems. The new ERA program helps rural Americans transition to clean, affordable, and reliable energy by reducing air and water pollution. This program is available to member-owned rural electric cooperatives. To be considered for funding, applicants must submit a Letter of Interest by the September 15, 2023 deadline.
What it means: Consider focusing marketing efforts to rural areas in the U.S. that are eligible for the USDA funding. Do your research to determine potential eligibility.
California is at it again. The CPUC introduced another proposal to negatively impact the value of rooftop solar for renters in multi-unit housing, farms, and schools. The decision could limit how much self-generated solar energy can be used and require them to sell it back to the utility at higher rates.
Stay tuned: The CPUC vote takes place on September 21, 2023. The decision seems to prioritize utility profits of renewable adoption, but claims to promote battery integration. We will have an update about the proposed decision in our next newsletter.
Business Strategy
According to David Dunlap, VP of product strategy at BayWa r.e., offering energy storage solutions can help solar businesses maintain financial stability and increase resilience. Offering batteries may help your solar business offset the solar sale declines in the US and broaden your market since most batteries are usable with and without solar panels.
High quality customer service may create repeat customers if you also offer battery products and installation. Solar equipment is expensive, so not every customer is going to install a battery at the same time as solar panels. If they have a great experience with your company, you will be the first installer in mind to start their battery installation process.
Another company working to combat regulatory updates is Enphase Energy. NEM 3.0 reduced the compensation rates for exporting solar energy to the grid in California. Enphase has updated some products to adapt to new regulations and optimize storage. The new system allows homeowners to consume and sell energy during optimal time periods and save backup energy.
What it means: Other solar companies will likely develop products and functions to stay up to date with policies. Customers find value in simplicity.
Solar Technology & Innovation
A solar panel's lifetime extends 25–30 years or more, but what happens when they are no longer effective? That’s where solar panel recycling centers come into play. The first utility scale solar panel recycling center opened in Yuma, Arizona. The We Recycle Solar facility can process up to 100,000 pounds of equipment daily.
A solar panel's lifecycle is an interesting selling point to customers, and could be a differentiating factor. Having an end of life plan for solar panel recycling is attractive to the eco-conscious consumer.
Have you heard of floating solar? Solar panels take up a lot of space that may be used for infrastructure, farming, etc. Duke Energy Florida is testing a pilot program for floating solar. The company is exploring the advantages and potential drawbacks of having solar on water versus land.
So far, the team has found that the panels are more efficient due to the water’s cooling effect while preventing evaporation which keeps the water level stable. The biggest challenge is ensuring the panels do not harm marine life and ecosystems. The pilot program findings will be interesting, and potentially another route for solar businesses to consider.
Solar Funding
The Greenhouse Gas Reduction Fund, a $27 billion program under the IRA, introduced two new funding opportunities worth $20 billion. The National Clean Investment Fund provides $14 billion in grants to support clean energy projects across the country. The other $6 billion is for the Clean Communities Investment Accelerator designated for lenders in low-income areas to increase solar accessibility in disadvantaged communities.
What it means: Solar businesses can tap into these funding opportunities to expand operations, improve infrastructure, and increase serviceability. This funding supports the broader solar community goals of reducing pollution and advancing clean energy adoption, especially in underserved communities.
Upcoming Events & Conferences
We’re all about learning and growing. Events are a fantastic way to network with others in the energy industry and stay up to date on the latest technology.
Sponsored by the SEIA and SEPA, RE+ is a clean energy conference and trade show in Las Vegas, Nevada. RE+ is the largest gathering of energy professionals in North America and is a great networking opportunity for all sectors of the energy industry.
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Have a fantastic weekend!
The purpose of this newsletter is to stay informed on business in the solar industry. Some advice or opinions may be included, but any actions taken are at your own risk.