solar outlook 2015

Solar Outlook 2015: Industry Grew Fast in 2014, Even Faster This Year

solar outlook 2015The 2015 Sustainable Energy in America Factbook (PDF) is out now, and the solar outlook is somewhat bright. But there are some dark corners of American infrastructure still in need of illumination.

This year’s annual report from the trade and industry coalition Business Council for Sustainable Energy was produced by Bloomberg New Energy Finance, and it’s got mostly good numbers for renewables fans. From 2007-2014, total U.S. investment in clean energy — which the Factbook defines as “renewables and advanced grid, storage, and electrified transport technologies” — totaled $386 billion. Solar and wind have tripled in capacity since 2008, to 87 gigawatts in 2014. Solar’s buildout was 50 percent higher in 2014 than it was in 2013, and “project pipelines today suggest even bigger numbers for 2015 and 2016,” the Factbook explained.

Meanwhile, rooftop solar is the fastest growing form of distributed energy, which on a whole “is prompting a rethink of grids, business models, and buildings,” it added. In 2013, investor-owned utilities and standalone companies poured almost $38 billion into their transmission and distribution infrastructure, while smart meters now cover almost 40 percent of American electricity customers. These dramatic scalings have been made possible by a swirling mix of factors, including federal and local subsidization and incentives like Investment Tax Credit, as well the cratering oil market, which is in turn putting pressure on the transportation sector to green up its dirty game. Of course, solar’s ITC is scheduled for a downsizing in 2016, which could slow down what significant progress photovoltaics have made in the shadow of dirtier but more glamorous energy alternatives, like so-called natural gas.

Indeed, it is natural gas — which is more or less methane, the opposite of clean energy, given that it is orders of magnitude worse than carbon dioxide — that takes up much of the Factbook’s early chapters and executive summary, which trumpeted that both supply and demand are “hitting all-time high.” In fact, the Factbook noted, the dance of market dominance between dirty fuels like coal and natural gas have actually increased carbon emissions from the US energy sector since 2012.

Drilling deeper into the Factbook, a sadder solar picture appears. Policy and funding support for both obsolete coal and flagging natural gas have held back solar’s inevitable ascendancy, given it is the cleanest energy in the mix. Net metering has penetrated a mere handful of states, one infographic explained, but even more have been marred by “fierce debates” over its obstruction and/or taxation. Meanwhile, funding of rooftop solar installations skyrocketed to $12.9 billion in 2014, while asset finance, public market and private equity investment all struggled to get past the $5 billion mark in the same year. Despite Bloomberg and BCSE’s good news on clean energy finance, Wall Street seriously needs to step up its solar bets.

Indeed, by the time you get past the many pages of natural gas cheerleading and finally hit the comparatively smaller solar section, the 2015 Factbook becomes a more depressing tale. Its PV-module-by-country graphic is simply owned by China, which deploys 26.9 percent of global panels, compared to America’s pitiful tenth of 2.7. The next graphic illustrates America’s utility-scale PV build takeoff, from 65 gigawatts in 2009 to 3,847 last year — but the Factbook even throws a wet blanket on that accomplishment, noting that “build is expected to level off this year as the pipeline in California begins to thin” — adding that it was driven by the state’s Renewable Portfolio Standard as a kicker.

Things get worse on graphics for solar’s private equity and asset finance investment, which peaked in 2011. Another few graphs later, including one showing that solar module prices are down by more than 80 percent relative to 2007 levels, and the Factbook’s photovoltaic pages halfheartedly conclude.

Of course, none of this is to say that solar is going away, or even sucking wind. If anything, the Factbook shows what happens when way too many eggs are placed in the wrong basket, namely natural gas, and how that inordinate focus and support wrongly holds back what are much cleaner, smarter energy alternatives with much higher returns on investment. BCSE and Bloomberg’s annual report may have wanted to put on a happy face by focusing on its “one unmistakable theme,” which is that “the broader US ecosystem is clearly preparing for a future in which sustainable sources of energy play a much larger role is becoming a problematic trend.”

But, in the final analysis, although it admits that the US power sector is decarbonizing, the Factbook happily notes (in its executive summary of all places) that the “US is one of the most attractive markets in the world for companies whose operations entail significant energy-related costs.” So if you don’t think that being the destination that natural-gas companies are “flocking to” in order to economically produce methanol and ammonia is synonymous with sustainability, then maybe next year’s report will make you happier.

 

solar niche

Solar Power 2014–Still Growing, Still Niche

solar nicheIf lily pads on a pond double the area they cover every day, and it takes 48 days to cover the pond, how long does it take them to cover 50% of the pond? (Answer at the bottom.)

The world is still looking for cost-effective substitutes for fossil fuels. Popular opinion still is heavily against nuclear, and environmental advocates still lobby against hydroelectric installations–at least in the developed world. (They don’t like it in emerging countries either, but they don’t get listened to quite as much down south.)

What’s available is wind, biofuels and solar. Wind and biofuels are stuck in controversy, so what is acceptable is solar.

 

EPRI incubator

EPRI launches Clean Energy Incubator Network with NREL and DoE

EPRI incubatorThe Electric Power Research Institute (EPRI) will convene a meeting in Washington D.C. on Feb. 11 of the Clean Energy Incubator Network, a national organization created with $2.3 million in funding by EPRI, the U.S. Department of Energy (DOE) and the National Renewable Energy Laboratory (NREL) to support clean energy entrepreneurs and incubators around the country.

The collaborative network will establish a suite of technological and training resources, connect critical industry and energy sector participants, enhance incubator best practices, and increase access to information about industry resources to advance innovative clean energy technologies. It will coordinate clean energy-focused business incubators, and provide online and technical resources to support the innovators and entrepreneurs.

The network’s initial members are the University of Texas-based Austin Technology Incubator (ATI), Clean Energy Trust (CET) of Chicago and NextEnergy in Detroit, and the LA Cleantech Incubator (LACI) in California. These incubators form the core group, serving as the foundation for the network as it grows to include additional members. They will facilitate access to mentors for clean energy entrepreneurs and provide guidance in business development, capital access, best practices and manufacturing support.

“Start-ups in the energy industry typically require more capital, longer timelines and intense networking in order to commercialize workable technologies,” said Elizabeth Hartman, EPRI project manager who oversees the activities of the network. “The collaboration between the incubator network and entrepreneurs will drive new technologies that add diversity to our energy mix, improve the environment and help to create a more flexible power system.”

The network will organize in-person and virtual meetings that showcase best practices on incubation techniques and clean energy technologies, starting with the innovators workshop this month and followed by a national summit during the summer. These events are expected to attract start-ups, incubators, clean energy investors, and industry participants.

EPRI aims to be the convening force behind building innovation across the industry and accelerating the development of science and technology solutions to transform the power system. The institute’s engagement with electric utilities abroad will provide entrepreneurs with insights on what is required for new technologies to be scaled up and widely deployed on a global scale.

 

Tech Energy and Commodity Energy: Different Worlds

Tech Energy and Commodity EnergySolar photovoltaic (PV) as a means of deriving energy is fundamentally different from fossil fuel-based commodities (oil, coal, and gas). Consider: A solar PV panel can be thought of as nothing more than a hugely oversized computer chip — a bunch of circuitry embedded in a silicon wafer. Indeed, in most economic sector classification schemes (GICS, etc.), PV manufacturers are defined as “semiconductors,” which is basically true (if misleading in other ways).  So different are the driving economics behind tech-based and commodities-based means of deriving energy, that we at Green Alpha are recommending to Standard & Poor’s and MSCI that they consider formally separating the two into distinct subsectors.

Recently, though, the two types of energy — oil and solar — have been trading in tandem, both falling significantly since mid-2014. Traders by and large seem to be thinking “energy is energy.” But this “energy-as-monolith” view is not appropriate to the reality of the economics, nor is it supported by the fundamentals.

 

solar growth

Report: Wind and solar energy have tripled since 2008

solar growthWe worry a lot about the problem of climate change. And we try to fix it — again, again and again — by changing how the country uses energy.

What we don’t stop and ponder enough, though, is that the country ischanging how it uses energy. It’s certainly not enough to silence all environmental concerns. But nonetheless, the progress, when you sample it, is really impressive.

Such is the takeaway from a new report out by Bloomberg New Energy Finance, which has just released its 2015 Sustainable Energy in America Factbook, prepared for the Business Council for Sustainable Energy. Looking back over recent years, the report shows that on any number of metrics, progress in clean energy has really been immense.

 

rooftop solar

Under the spotlight: Ian Draisey on the direction of rooftop solar

rooftop solarFollowing the purchase of PV distributor Metgen this week, Solar Power Portal caught up with Bay Wa r.e.’s Ian Draisey to talk about the future of UK solar.

How do you feel about the current state of the domestic installer market?

I’m relatively confident, and have converted that confidence into modest increases in growth for 2015 in my forecasts for the year. I’m always surprised at just how reactive the market is to the smallest of reductions in the feed-in tariff (FiT) rate. This is indicative perhaps of how solar is sold, and that the reductions have become as much a cultural catalyst to demand that the ROI figures could only aspire to be. I am an advocate of subsidy free solar, and can’t wait until we are genuinely there. I’m very interested to see whether the onset of more frequent reductions afflict the domestic sector with the malaise we experienced in April 2014, or whether they underpin the message that now is always the best time to buy solar.

 

Sustainable Energy in America Factbook

Sustainable Energy Revolution Grows, Says Bloomberg Report

Sustainable Energy in America FactbookThe third annual Sustainable Energy in America Factbook released today documents the continuing dramatic changes in how the U.S. produces, delivers and consumes energy, and makes some projections and predictions about the direction of the energy sector in the future. The report was researched and produced by Bloomberg New Energy Finance and commissioned by The Business Council for Sustainable Energy.

“To single out just a few tell-tale headlines from the hundreds of statistics presented in this report: over the 2007-2014 period, U.S. carbon emissions from the energy sector dropped 9 percent, U.S. natural gas production rose 25 percent and total U.S. investment in clean energy (renewables and advanced grid, storage and electrified transport technologies) totaled $386 billion,” the report said.

The report backs up what other studies have been showing—that despite strong resistance on the part of the fossil-fuel sector and some policymakers, a new way of thinking about energy is taking hold. The factbook points to four significant trends:

solar stocks suffer at whims of irrational investors

Now is the time to invest in solar, because people are stupid

solar stocks suffer at whims of irrational investorsIf you’re thinking of investing in solar energy companies, now might be a good time to buy.

Most of the major publicly traded solar companies have seen their stock prices decline by around 10 to 20 percent over the last three months. SolarCity, a residential and commercial supplier, has dipped from $54 to $49 per share. First Solar, which makes utility-scale projects, dropped from $56 to $43. Panel manufacturers JinkoSolar and SolarWorld are down from $23 to $18 per share and $14 to $12, respectively.

Normally, declining stock prices would reflect weak growth or a shaky outlook for an industry. But solar energy is growing by leaps and bounds. In the first three quarters of 2014, 3,966 megawatts of solar capacity were installed in the U.S., compared to 2,647 MW in the first three quarters of 2013. Solar deployment is not only expanding, but the pace at which it’s growing keeps accelerating. In 2014, according to a new report from the Solar Foundation, an independently funded think tank, the solar industry added workers almost 20 times faster than the overall U.S. economy, accounting for almost 1.3 percent of all jobs created.

World solar PV BOS market will lose USD 10 billion in value by 2020, says GlobalData

balance of system solarThe global solar photovoltaic (PV) balance of system (BOS) market will decline in value from an estimated $34.9 billion in 2014 to $24.9 billion by 2020, due to falling BOS costs and the slow increase in global annual capacity additions, says research and consulting firm GlobalData.

However, the company’s latest report* indicates that while developed markets, such as the US, UK and Germany, will be the main contributors to this decline, some emerging countries, led by China, will witness growth over the forecast period.

The largest drop will occur in the US, where the solar PV BOS market value will more than half, from $6.7 billion in 2014 to $3.3 billion by 2020.

Harshavardhan Reddy Nagatham, GlobalData’s Analyst covering Power, says: “The US solar PV market has grown strongly in recent years, and policies that promote solar power are increasing at both the federal and state level.

“Thanks to Investment Tax Credits (ITCs), the BOS market will see some initial growth, but it will begin to decline when ITCs expire in December 2016. This, combined with the cost of systems continuing to slide, will cause the US market to fall below 2011 levels by the end of the decade.”

By contrast, China’s BOS market value will expand from $6.8 billion in 2014 to $8.2 billion by 2020, cementing its position as the world’s leader in this space.

Nagatham continues: “China’s government has introduced a number of financial and regulatory initiatives to promote renewable energy sources. The country’s National Energy Administration is spending about CNY250 billion, or $39.5 billion, on developing the solar power sector during the 12th Five Year Plan, which ends this year.

“As such, China’s annual capacity additions have increased rapidly over the past few years, rocketing from 0.5 Gigawatts (GW) in 2010 to 12.42 GW by 2013. This high level of annual addition is expected to continue with even more growth through to 2020, providing a huge opportunity for BOS manufacturers.”

solar power capacity

Wood Mac: U.S. solar power capacity in a boom cycle

solar power capacity

Solar power progress in the United States is expected to advance to record levels as prices decline and technology improves, Wood Mackenzie finds.

Energy consultant group Wood Mackenzie finds it’s getting cheaper to install solar power components. With this, new solar capacity has evolved from a niche renewable sector to something that’s pressuring conventional business models in the utility industry.

“Just as shale extraction technologies reconfigured oil and gas markets, no other technology is closer to transforming power markets in a similar fashion than distributed and utility-scale solar,” Prajit Ghosh, research director for American renewables research, said.

Oil Can't Compete Anymore

Seven Reasons Cheap Oil Can’t Stop Solar Power Anymore

Oil Can't Compete Anymore

Oil prices have fallen by more than half since July. Just five years ago, such a plunge in fossil fuels would have put the renewable-energy industry on bankruptcy watch. Today: Meh.

Here are seven reasons why humanity’s transition to cleaner energy won’t be sidetracked by cheap oil.

1. The Sun Doesn’t Compete With Oil

Oil is for cars; renewables are for electricity. The two don’t really compete. Oil is just too expensive to power the grid, even with prices well below $50 a barrel.
Instead, solar competes with coal, natural gas, hydro, and nuclear power. Solar, the newest to the mix, makes up less than 1 percent of the electricity market today but will be the world’s biggest single source by 2050, according to the International Energy Agency. Demand is so strong that the biggest limit to installations this year may be the availability of panels.

“You couldn’t kill solar now if you wanted to,” says Jenny Chase, the lead solar analyst with Bloomberg New Energy Finance in London.

parking lot solar

The best idea in a long time: Covering parking lots with solar panels

parking lot solar
Parking lot featuring solar power panels to shade cars and provide power.

America is a nation of pavement. According to research conducted by the Lawrence Berkeley National Laboratory, most cities’ surfaces are 35 to 50 percent composed of the stuff. And 40 percent of that pavement is parking lots. That has a large effect: Asphalt and concrete absorb the sun’s energy, retaining heat — and contributing to the “urban heat island effect,” in which cities are hotter than the surrounding areas.

So what if there were a way to cut down on that heat, cool down the cars that park in these lots, power up those parked cars that are electric vehicles (like Teslas), and generate a lot of energy to boot? It sounds great, and there is actually a technology that does all of this — solar carports.

It’s just what it sounds like — covering up a parking lot with solar panels, which are elevated above the ground so that cars park in the shade beneath a canopy of photovoltaics. Depending of course on the size of the array, you can generate a lot of power. For instance, one vast solar carport installation at Rutgers University is 28 acres in size and produces 8 megawatts of power, or about enough energy to power 1,000 homes.

 

renewable energy outlook

Photovoltaic, Wind and Hydro Star as Top Renewables, Finds Frost & Sullivan

renewable energy outlookLONDON, Jan. 28, 2015 /PRNewswire/ — The past decade has witnessed significant developments in policies for renewable energy. Previously, less than 50 countries worldwide had support policies for renewable energy; this number now stands at more than 130. As a result of political and financial support, investments in renewables have risen dramatically in recent years. In fact, the European Union has set binding targets to source 20 percent of the bloc’s total energy consumption from renewable energy by 2020. Accordingly, individual member states have set renewable energy consumption targets ranging from 10 percent for Malta to 49 percent for Sweden.

New analysis from Frost & Sullivan, Annual Renewable Energy Outlook 2014, forecasts the global installed capacity of renewable energy to more than double from 1,566 gigawatts (GW) in 2012 to reach 3,203 GW in 2025 at an average annual growth rate of 5.7 percent.

For complimentary access to more information on this research, please visit: https://corpcom.frost.com/forms/EU_PR_CCarella_MAB0-14_12Jan15.

Solar photovoltaic (PV) technology is expected to account for 33.4 percent of total renewable energy capacity additions over the 2012-2025 period. Wind follows closely at 32.7 percent, ahead of hydro power at 25.3 percent. Other renewable technologies will represent the remaining 8.6 percent of capacity additions. However, economic difficulties in many parts of the world are affecting the outlook for renewable energy. In much of the Western world, the weak economic climate has impacted support schemes, which will continue to be the lifeline for many renewable energy installations until grid parity is achieved.

“It is little wonder then that renewable energy installations have seen a gradual shift in market power to emerging economies,” said Frost & Sullivan Energy & Environmental Industry Director Harald Thaler. “On account of urbanisation, population growth, energy security concerns, and strong economic development, regions such as Asia, Latin America, the Middle East and Africa have increasingly been contributing to renewable energy capacity growth.”

The decline in the cost of renewable energy due to technological innovation and scale economies achieved through mass deployment have enabled developing countries to adopt these technologies. In fact, global solar power capacity is due to increase from 93.7 GW in 2012 to 668.4 GW in 2025. However, while solar PV is undergoing a veritable boom, massive price falls in this technology have greatly weakened the growth prospects of the concentrated solar power (CSP) market.

The global capacity of hydro power will rise from 1,085 GW in 2012 to 1,498 GW in 2025, with China, Turkey, Brazil, Vietnam, India and Russia contributing strongly to market growth. In the wind power market, offshore wind will witness lower-than-expected growth, as political support wanes in Europe. With small-scale wind turbines opening up new applications, global wind capacity will reach 814 GW in 2025 from its 2012 level of 279 GW.

“Europe will remain the leading region in the global bioenergy and waste segment even as future capacity expansion in the segment comes from Southeast Asia, Australasia, North America, Turkey, Iceland and Kenya,” noted Thaler. “Beyond 2025, marine power technology will also be widely deployed as government willingness to back emerging technologies increases.”

solar Hanwha

‘Sexy’ No Longer, Solar May See More Consolidation, Hanwha Says

solar HanwhaTumbling oil prices will maintain pressure on the solar industry to consolidate by drying up investor interest in building new factories, according to an executive who just carried out a $1.2 billion merger.

Dong Kwan Kim, chief commercial officer of Hanwha SolarOne Co. (HSOL), said the industry has been “unfairly penalized for oil prices” and that the company that ranks among the top three panel makers may return to profit this year for the first time since 2010.

“When oil prices were very high and green energy was a sexy, hot sector, I think a lot of money was pouring into overcapacity,” Kim said in an interview at the World Economic Forum in Davos today. “The oil price should help in that sense while not hurting our business materially.”

Oil’s decline is thwarting the sort of deals that built China’s solar industry in the last decade — and left it with a crippling excess of capacity that gutted prices and margins across the industry.