Guest essay by Eric Worrall
Financially troubled solar businesses seem to be hitting the headlines a lot these days.
Solar Industry Slowdown Catches Up With SolarCity
By Mrinalini Krishna | May 5, 2017 — 11:04 AM EDT
After nice stretch of sunny weather, the last few months have clouded over for big solar. Declining prices for photovoltaic cells are hurting panel manufacturers and stressing solar installation businesses. This situation was in sharp relief this week in Tesla’s (TSLA) earnings, as its solar installation business, SolarCity, disclosed a big slowdown in builds. SolarCity commands 41 percent of the residential solar installation market, according to GTM. In its latest earnings, the firm revealed that it had installed 150 MW of panels in the first quarter, down nearly 39 percent y/y.
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There are companies that are doing well. First Solar (FSLR) just reported strong earnings while Vivint Solar (VSLR) announced is expansion into Rhode Island and is expected to announce financial results next week. However, the list of struggling companies in the sector is longer.
SunPower Corp. (SPWR) reported its sixth consecutive quarter of losses and laid off 25 percent of its workforce. Verengo Solar filed for bankruptcy last year, while Sungevity and Suninva did the same earlier this year.
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Read more: Solar Industry Slowdown Catches Up With SolarCity
United Power acquires former home of bankrupt Abound Solar
By Doug Storum — May 2, 2017
LONGMONT — Brighton-based United Power Inc., has acquired the former home of Abound Solar Inc., in east Longmont for $8.8 million, according to public records.
9586 LLC, an entity registered to Boulder-based real estate firm W.W. Reynolds Cos., sold the 130,117-square-foot facility on 7.6 acres at 9586 E. I-25 Frontage Road just south of Colorado Highway 119 in Weld County. The building has been vacant while an effort to remove hazardous waste left behind by Abound was tied up in insurance claims court.
Abound Solar went bankrupt in 2012 after receiving stimulus money from the federal government.
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Read more: http://bizwest.com/2017/05/02/united-power-acquires-former-home-bankrupt-abound-solar/
Some solar businesses have resorted to begging President Trump for import duty protection against cheaper foreign imports.
Suniva Creates the Latest Solar Debacle
Written by Anne Fischer 28 April 2017
Suniva filed for bankruptcy protection on 17 April, and then nine days later filed a trade case mechanism with the International Trade Commission (ITC) to try to impose tariffs and to set minimum prices on all imported solar modules. This would add tariffs to those already imposed on Chinese modules.
Who is Suniva?
Suniva is based near Atlanta, Georgia and has manufacturing facilities in Georgia and Michigan. On its website, the company claims to be the “leading American manufacturer of high-efficiency, cost-competitive PV solar cells and modules.” (Suniva is majority owned by a Chinese company, Shunfeng International Clean Energy.)
In the past two years, as prices on solar modules dropped and demand decreased due to oversupply, Suniva was losing millions. Ultimately the company filed for bankruptcy, placing blame on Chinese manufactures who flooded the US market with cheap imports.
Why file Section 201?
Suniva’s filing a petition under section 201 of the Trade Act of 1974 is a condition of its bankruptcy. If the ITC determines that Suniva was “seriously injured” by solar imports, it can recommend to the Trump administration provide relief to Suniva in the form of tariffs on all imports in order to curb competition from manufacturers in any country other than the United States. Suniva sees this as an effort to get back into business with American-made modules.
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Read more: http://www.solarnovus.com/suniva-creates-the-latest-solar-debacle_N10838.html
To anyone who thinks that President Trump is the cause of the solar slump, its interesting to note the wave of solar bankruptcies began well before Donald Trump won the presidency. Aside from the spectacular failure of Solyndra, another big US solar business SunEdison declared bankruptcy in April 2016.
In the Market for a Solar Farm? SunEdison Has Some for Sale, Cheap
The spectacular failure of what was once the world’s biggest renewable-energy company has turned into a smorgasbord of wind and solar farms being gobbled up by infrastructure investors, clean-power developers and even a vegan soccer team.
Since filing the largest U.S. bankruptcy of 2016, SunEdison Inc. has hosted the biggest-ever sale of renewables assets. It’s shed at least $1 billion of assets from Southern California to Chile to India– some through record-breaking deals–including projects that would have died without new owners. With wind and solar supplying more than 11% of global electricity, the company’s debt-induced collapse enabled competitors to strengthen their existing hands or enter new markets.
“Developers have been picking at the carcass,” Nathan Serota, a New York-based analyst at Bloomberg New Energy Finance, said in an interview. “As it turns out, the carcass was not so bad.”
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Read more: http://www.industryweek.com/energy/market-solar-farm-sunedison-has-some-sale-cheap
It is difficult to know for sure whether this apparent upswing in solar bankruptcy stories is significant.
What seems plain is that solar businesses, at least those which manufacture solar systems, are being squeezed between a flood of cheap cheap imports and cooling federal government enthusiasm for subsidising solar energy.
I believe the suggestions that China are dumping solar on the US market are credible – though if China wants to save the world by subsidising cheap solar for everyone, who are we to say no?
It is not all bleak news for US solar investors. despite federal indifference, there are still rich US states like California, whose legislature seems keen to continue pouring public money into the bottomless renewables money pit.
How long states like California can continue to ignore economic competition from low cost states is a different matter.
“Impending US Solar Energy Crash?”
Doesn’t sound like a crash for solar energy. It sounds like “if China wants to save the world by subsidising cheap solar for everyone, who are we to say no?”. Bad time for US manufacturers, good time for US buyers. Sounds familiar?
SunEdison is THE long-lasting renewable energy company. Now it is gone as well as the 10,000 start-ups after it.
These companies all eventually go under. Somebody loses big bucks and somebody makes big bucks. But it is just not a viable business on a long-term basis because the physics of solar and wind just do not work. Subsidy-mining is all it really about.
The next politician who proposes expanding or even keeping these subsidies should be promptly voted out of office simply because they have poor judgement. These people should not be making decisions for us because their judgement sucks. We should all be making this point when ever it comes up and we need to get these people out of office. They are wasting YOUR money.
The suggestion was made to build Trump’s Wall with solar panels…..so it pays for its self….Bwaaahahahaha.
And California has a major unfunded pension overhang, so the ability of the state to continue subsidies for solar is limited by the willingness of the Federal government to bail them out. Most of the states favoring solar are in the same situation as California.
Wind mill farms will get Crop price support from tax money!
One thing that gets missed is that, even if the panel installers were making money, a lot of the “early adopter” systems are starting to show their age already. This is a problem, since the normal pitch is “this will last 25 years with minimal maintenance,” but five or six years in, a bunch of those early systems are having hardware problems, on top of some early efficiency drops that just weren’t supposed to happen yet. Cheap panels = cheap weather seals + cheap wiring.
A further drop in panel prices isn’t going to help much, either, since the biggest cost for a photovoltaic system isn’t the panels any more – it’s the installation, from permitting to hanging the things on the roof to managing the power storage and wiring. While the panels are pretty straightforward, everything else in the system is a custom install, and that costs $$$ – while making long-term reliability and troubleshooting even more expensive.
The big solar farm providers are in the same boat – one-off, handbuilt systems made up of millions of parts, all installed by low bidders and semi-skilled labor.
Many haven’t learned the lesson from the 1930’s and 1940’s about Tariffs. The Free Enterprise system doesn’t work when Trade with other countries is hindered by Tariffs. It raises the cost for those products and reduces trade with them. All Nationalist systems fail because it increases cost to the consumers, because the local products producer’s increase their prices to match the lower prices from other countries. Extreme taxation and regulations are why it costs USA manufacturers to provide compatible products to compete. If Trump’s reductions had been in effect since Reagan or JFK that started that ideology…we wouldn’t be in the mess we’re in now. But policymakers want more of your money to fund all their pet projects and it is killing the provider’s and the consumers by price distortions that always go up.
What drives me nuts is that all of this installation is heavily subsidized by the tax payers. It is all an artificial market.
Two words. Energy density.
The “oh just you wait until solar is cheaper” crowd is now the “oh crap solar is too cheap to be profitable” crowd.
It’s too cheap for the producers to make money and it’s too expensive for the consumers to buy it without government subsidies.
Such a quandary.
Surprise surprise. The low hanging solar panel fruit has been picked and there’s no more takers.
Solar Panels- I got Sunpower panels in late 2008. They started out at 25% over MJN(Mid-Atlantic) estimate. They ended 2016 at 11% over. <2% a year deterioration. I'm happy.
The subsidies were, and are, ridiculous. I estimate we got about a 37% installation subsidy, not mention the stupid renewable credits. The panels themselves, just by largely offsetting air conditioning costs, would have paid for themselves long before they hit 70% capacity around 30 something years.. They'd continue paying for the AC then. I'm sure I'll be long gone. Once again, thank you all for your generous contributions.
I'm kinda sorry, but if the folks are willing to vote in imbeciles that pass these laws I'll live buy them(bad pun). I really Trump gets the EPA reigned in quickly and simply cancels Ob's executive order on the Paris Agreement. Just give them the 1 year notice and be done with it. Then anyone who wants to make a real treaty will have to get it by the senate.
Watermelon Environmentalist Economics; More Waste, Inefficiency, and Incompetence than Conservation
Ever wonder why Sierra Club, World Wildlife Fund, Greenpeace and any other Marxist Watermelon Environmental organization never produce any “green products” that actually prove the theories they are supporting will actually do any good? The reason is simple, the economics simply aren’t there. Watermelon groups spend most of their money lobbying the government to spend tax dollars to fund their projects.
https://co2islife.wordpress.com/2017/05/06/watermelon-environmentalist-economics-more-waste-inefficiency-and-incompetence-than-conservation/
“In the past two years, as prices on solar modules dropped and demand decreased due to oversupply, Suniva was losing millions …”
I fail to see how oversupply can be responsible for “demand decrease”. If this is indicative of the kind of analysis that guides this industry, then it is not surprising that their plan “B” is a vacuum-proof connection to the public treasury facilitated by the worst sort of politicians.
If they are unable to survive with a 30% cost subsidy just from the US federal government ITC alone, the forecast must indeed be “worse than we thought”.
http://news.energysage.com/congress-extends-the-solar-tax-credit/
“With wind and solar supplying more than 11% of global electricity, the company’s debt-induced collapse enabled competitors to strengthen their existing hands or enter new markets.”
Leftist cronies are such liars…
Wind and solar produce nowhere NEAR 11% of global electricity…
A typical Leftist will also tell you wind and solar are now “cheaper” than coal and natural gas in terms of cost per kWh…. The reality is that wind/solar are roughly 5~6 TIMES as expensive: $0.30/kWh vs. $0.06/kWh…
This is just another example of Leftists repeating lies in pursuit of their nefarious ends..
“Hard to see low demand there.”
Those numbers are estimated generation. Let me put it into perspective. Mickey Mouse is a more important part of the US economy.
I am still waiting to see an honest economic evaluation of small scale solar.
One reason for the uptick in bankruptcies and cutbacks is Trump – or, rather, not-Hillary. Some were undoubtedly hanging on in anticipation of being bailed out.
Hi all ,Im a lifelong Democrat who totally agrees 100% with the Skeptic argument about AGW.
Im wondering how you intelligent right wingers can think its a good idea to lose your health care due to preexisting conditions?
I mean you and your parents and children are going to be at risk of death .So whats the point?
I followed this blog for the past 10 years.Im a supporter of the skeptic science.
But how can you be so stupid to support harm to yourselves and your families?
Markl let me know how you feel when your kids are dead from lack of care.
Bad trolling there, mojoman, I’ll give it a D-.
Summary –
https://youtu.be/b0p9GmALDF8
Summertime Blues
Blue Cheer
Lyrics
Well Lord I got to raise a fuss, Lord I got to raise a holler
About a workin’ all summer just to try to earn a dollar
Well, Lord, I tried to call my baby, I tried to get a date
Sometimes, I wonder what I’m gonna do
Lord, there ain’t no cure for the summertime blues
Well my mom and papa told me son you gotta make some money
Well if you wanna use the car to go a ridin’ next sunday
Oh, Lord, I didn’t go to work I told the boss I was sick, said
Sometimes, I wonder what I’m gonna do
Lord, there ain’t no cure for the summertime blues
I’ve got to take three weeks I gotta have a fine vacation
I gotta take my problems to the United Nations
I done told my congress man and he said “vote” (dig this boy)
Sometimes, I wonder what I’m gonna do
Lord, there ain’t no cure for the summertime blues
The solar industry has had problems, a long time before Trump took up office. Bankruptcy after bankruptcy, took place in 2010-2017 with small and large solar installation, manufacturer and retail outfits.
I worked for one , that went b.k. and left me with no pay for the last month of work with them . The company( incorp) filed bankruptcy ( chapter 7 only ) and I never seen a cent. While mech. Liens were placed on homes and businesses. Because solar panels and other materials were not paid. This happened all the time , with many solar scammers and crooks benefitting and just starting new solar companies. I read in 2012 that Obama was an investor in many of these companies.
But all was swept under the rug. Maybe Trump may help clean up some of this. Which believe was a start of problem, that is or could hurt the solar industry.