Why are solar companies going out of business

[kort677]

Low demand due to ROI not being sufficient is typical short sighted human behavior. Pretty common, unfortunately.

short cited human behavior? maybe through your clouded prism.
a good many number of people base their investments on things like solar installations based on efficiencies gained and monies saved. saving the world from a dubious crisis is way down the list.

 

[kort677]

Why is the yield so low compared to your usage? Do you have a small roof or are you consuming vast amounts of electricity to run AC? Or?

I understand also that Florida PoCos have bribed legislators to make net metering laws very unfriendly to homeowners. Is that right?

5k sq foot home, about 2200 sq ft of roof available for panel installation, I suppose my usage is high because of cooling costs, nonetheless a solar panel installation might supply 1/3 of my power needs.
it just doesn't make sense for me and 99.9% of the homeowners in my area. I do have a small array for water heating.

 

[bkp_duke]

Can you cite some of those examples of analyst optimism for us? I am planning to install rooftop PV and I would like to select modules and inverter from a manufacturer that is likely still to be in business should I ever need to exercise warranty rights.

Thanks

SunPower - Analysts Showing Optimistic Trends For SunPower Corporation (SPWR)

With respect, that is an endorsement of past corporate behavior, not financial viability. I too like SunPower's products and the fact that they are manufactured under excellent environmental standards, but in the past two years plunging module prices have saddled the company with many millions of dollars of debt. Will they still exist when one of my modules fails? I'd feel better if smart money people liked their chances of survival.

Again, SunPower. They constantly make the best gear, bar none and no one debates that. The only debate is whether they are worth the price premium that their gear commands (about 20-25% more expensive than the next best).

I understand that and it is the reason for my post, if Sun Power goes under I wonder who in the solar industry will survive.

Agreed. SunPower is owned by France's Total Energy, one of the largest energy companies on the planet. This company dwarf's Tesla/Solar City in terms of revenue.

 

[bkp_duke]

5k sq foot home, about 2200 sq ft of roof available for panel installation, I suppose my usage is high because of cooling costs, nonetheless a solar panel installation might supply 1/3 of my power needs.
it just doesn't make sense for me and 99.9% of the homeowners in my area. I do have a small array for water heating.

Could you share the numbers you are working with?

Our home is of similar size, and the numbers are very different because we have California utility rates, but we installed a 12kW system and it is currently producing about 200% of our needs (granted, before a pool installation), with two Teslas.

 

[kort677]

Could you share the numbers you are working with?

Our home is of similar size, and the numbers are very different because we have California utility rates, but we installed a 12kW system and it is currently producing about 200% of our needs (granted, before a pool installation), with two Teslas.

I don't have the numbers handy, how much cooling do you do? I have 4 zones on 24/7 from may until october then as needed. my rates are .11 per kwh

 

[bkp_duke]

We have 4 zones, and run the units about 40-50% of the time from June through Oct.

The detailed monitoring I have through SunPower on the usage shows the AC is pulling about 15-20% of our total usage, with the cars being by far the largest factor.

11c/kwh is certainly an attractive rate. Our average is almost 4 times that out here.

 

[brucet999]

I wouldn't be surprised if China was intentionally trying to kill off other solar manufacturers to monopolize this important market. And it's almost hard to complain, as cheap solar is important. I know Republicans hate subsidies, but in this limited case, I think the US should really be subsidizing solar power more. It's important to the future security and stability of the country. Subsidize the buyers, or subsidize the manufacturers, or subsidize the power companies by funding new solar power plants. Any or all would help.

Only subsidies on manufacturing would help that situation and it's too late now that the last US manufacturer has gone bankrupt. As for North America, there is one Canadian company manufacturing in North America (SilFab in Guelph Ont.) and SunPower manufactures in Mexico. Tesla Energy promises to make solar roof tiles in Buffalo starting in the fall, and Panasonic will make modules there as well, but those are of no help to those of us who shy away from dealing with Solar City idiots or their successors.

 

[SageBrush]

. I know Republicans hate subsidies

Unless it benefits one of their pet industries. Like fossils

 

[nwdiver]

Maybe someone (NWdiver) can help me understand why this is happening. I would have thought that now that solar panels are less expensive and more people are installing them companies could still be competitive and also make a profit.

Are you referring to manufacturers or installers? Manufacturing solar has always been a low margin business. IMO the national solar installers are struggling for 2 reasons. 1) Solar installations really need to be a local gig. I don't know why but national installation businesses typically don't work. 2) Most are operating on a lease model which worked initially but I think that demographic was narrow and now there's more people looking to own rather than lease their systems.

There are A LOT of small local installers that are doing VERY well. Power trip Energy that operates in the Olympic Peninsula sells systems for ~$4.50/w and installs 2/month. My goal is 1/week @ $3/w.... we'll see....

SunPower does have the best panels... but I have a hard time justifying spending ~$1w vs $0.30/w

 

[brucet999]

As a result, my only option is to install my own rooftop solar, and I intend (have budgeted) to do that early next year. In classic human short sighted behavior, even this will be a fight because my HOA will say it "doesn't look good", no matter the future of humanity or anything. .

You may be able to mitigate that complaint with Solar Skins from Sistine Solar.

Beautiful Solar Panels I Sistine Solar

 

[Merrill]

Are you referring to manufacturers or installers? Manufacturing solar has always been a low margin business. IMO the national solar installers are struggling for 2 reasons. 1) Solar installations really need to be a local gig. I don't know why but national installation businesses typically don't work. 2) Most are operating on a lease model which worked initially but I think that demographic was narrow and now there's more people looking to own rather than lease their systems.

There are A LOT of small local installers that are doing VERY well. Power trip Energy that operates in the Olympic Peninsula sells systems for ~$4.50/w and installs 2/month. My goal is 1/week @ $3/w.... we'll see....

SunPower does have the best panels... but I have a hard time justifying spending ~$1w vs $0.30/w

Both, but mostly installers and I wonder how this will shake out. I'm not a lease type, I prefer to purchase. I guess my original reason for this post is having a hard time understanding how solar is expanding and yet solar companies going out of business.

 

[nwdiver]

I guess my original reason for this post is having a hard time understanding how solar is expanding and yet solar companies going out of business.

It's a highly competitive environment especially on the manufacturing level, specifically modules. Inverter companies are doing ok, large companies like SMA, Solaredge and Fronius aren't going anywhere.

It's mostly the national installers that are struggling. Local installers are doing much better. Even in Nevada the local installers were able to hold on when Solar City and Sunrun left the state after the policies changed.

 

[brucet999]

5k sq foot home, about 2200 sq ft of roof available for panel installation, I suppose my usage is high because of cooling costs, nonetheless a solar panel installation might supply 1/3 of my power needs.
it just doesn't make sense for me and 99.9% of the homeowners in my area. I do have a small array for water heating.

I have much more modest system planned, but SunPower E20-327 modules produce 18.6W/sq ft at a cost installed (after 30% federal tax credit) of about $2.87/W. A nominal 4.9kW system figures to produce 7950kWh per year from 15 modules covering almost 264 sq ft of roof space. If only 75% of your 2200 sq ft of roof space were usable, you could still get 6 times my production; about 48,000 kWh per year.

Given our high average 24cents / kWh rate, my system would return about 10% at present day PoCo rates. Some people say that is too long a break-even time, but I will be cashing in securities to pay for it, so I view it as an alternative investment. 10% tax-free return = 13% taxable, so this thing will return more than twice what I earn now on my investments, and as SCE rates inevitably rise year after year, it gets better. The only down-side is that my PV investment will be as illiquid as my house.

 

[nwdiver]

nonetheless a solar panel installation might supply 1/3 of my power needs.
it just doesn't make sense for me and 99.9% of the homeowners in my area. I do have a small array for water heating.

This is one of the things I really don't get... it's about ROI... who cares if it covers everything? 1/3 is 1/3. If you spend $30/mo on solar and save $50/mo on your electric bill how is that not a win? Why do so many people have an all or nothing approach?

Even your solar thermal system is only supplemental... I'm sure it has electric for backup. And; the ROI for solar thermal is worse than for Solar PV for most of the systems I've seen. The typical solar thermal system costs >$5k and saves maybe $10/mo. A $10k PV system will save ~$50/mo.

 

[Merrill]

This is one of the things I really don't get... it's about ROI... who cares if it covers everything? 1/3 is 1/3. If you spend $30/mo on solar and save $50/mo on your electric bill how is that not a win? Why do so many people have an all or nothing approach?

Even your solar thermal system is only supplemental... I'm sure it has electric for backup. And; the ROI for solar thermal is worse than for Solar PV for most of the systems I've seen. The typical solar thermal system costs >$5k and saves maybe $10/mo. A $10k PV system will save ~$50/mo.

I totally agree with you, I did look at ROI but that was secondary to not supporting our power company. You might call me crazy but I would what ever I had to to minimize my expenditure to Pacific Graft and Extortion!

 

[kort677]

This is one of the things I really don't get... it's about ROI... who cares if it covers everything? 1/3 is 1/3. If you spend $30/mo on solar and save $50/mo on your electric bill how is that not a win? Why do so many people have an all or nothing approach?

are you really this fiscally daft? spending 30-40K to save a mere fraction of monthly costs that will take almost 2 decades to cover it's costs makes sense to you? really? it certainly makes little economic sense to me. my water heater cost about $4K less a 30% tax credit, it reduces my costs $25-30 a month, the payout is 5+ years, a full solar system would have been over $40k, including a tax credit, it would reduce my rates by less than $100 a month with a 15+ year payout. how many ways till tuesday do I have to say that it makes no sense to spend that kind of money to save so little money? if you want to waste your money in order to save the world from a dubious at best problem, good for you, but don't try to tell others what is right for them.

 

[kort677]

I have much more modest system planned, but SunPower E20-327 modules produce 18.6W/sq ft at a cost installed (after 30% federal tax credit) of about $2.87/W. A nominal 4.9kW system figures to produce 7950kWh per year from 15 modules covering almost 264 sq ft of roof space. If only 75% of your 2200 sq ft of roof space were usable, you could still get 6 times my production; about 48,000 kWh per year.

Given our high average 24cents / kWh rate, my system would return about 10% at present day PoCo rates. Some people say that is too long a break-even time, but I will be cashing in securities to pay for it, so I view it as an alternative investment. 10% tax-free return = 13% taxable, so this thing will return more than twice what I earn now on my investments, and as SCE rates inevitably rise year after year, it gets better. The only down-side is that my PV investment will be as illiquid as my house.

my rates are .11 per kwh, so the numbers are very different for me and the payout is much longer and it isn't all that great of a way to use my money.

 

[nwdiver]

are you really this fiscally daft? spending 30-40K to save a mere fraction of monthly costs that will take almost 2 decades to cover it's costs makes sense to you? really? it certainly makes little economic sense to me. my water heater cost about $4K less a 30% tax credit, it reduces my costs $25-30 a month, the payout is 5+ years, a full solar system would have been over $40k, including a tax credit, it would reduce my rates by less than $100 a month with a 15+ year payout. how many ways till tuesday do I have to say that it makes no sense to spend that kind of money to save so little money? if you want to waste your money in order to save the world from a dubious at best problem, good for you, but don't try to tell others what is right for them.

OK... let's run the numbers....
There are crooks out there that charge ~$5/w... don't buy stuff from crooks... pretty good place to start.
Reputable PV installers charge ~$1.50/w for labor and can usually install a system for ~$3/w.
A 8kW system will produce ~12000kWh/yr in Florida and cost ~$24k to install. Less the 30% FTC that's $16800.
12000kWh * $0.11/kWh = $1320/yr
$16800/$1320 = 12.7 year payback assuming the price of electricity won't rise (which it will)

DIY is easily <$1/w for a payback <4 years. I'm hoping to be able to offer installs for ~$2/w in a couple years once we get some experience. That's this isn't already occurring is absurd. Solar is not hard to install....

Instead of spending $4k to save ~$25-$30 per month (a claim FAR more dubious than proven physics) with solar thermal you could have spent $1300 on a heat pump to save ~$20-$25 per month and spent the remaining $1500 on some solar PV to save even more This is why I don't like solar thermal.... it's not cost effective....

 

[tezzla]

@kort677 is in another world than So Cal, I paid around $13k (after tax credit) for a 5kW system. My monthly billing went from $250 a month to $50 a month CREDIT.

 

[TheTalkingMule]

OK... let's run the numbers....
There are crooks out there that charge ~$5/w... don't buy stuff from crooks... pretty good place to start.
Reputable PV installers charge ~$1.50/w for labor and can usually install a system for ~$3/w.
A 8kW system will produce ~12000kWh/yr in Florida and cost ~$24k to install. Less the 30% FTC that's $16800.
12000kWh * $0.11/kWh = $1320/yr
$16800/$1320 = 12.7 year payback assuming the price of electricity won't rise (which it will)

DIY is easily <$1/w for a payback <4 years. I'm hoping to be able to offer installs for ~$2/w in a couple years once we get some experience. That's this isn't already occurring is absurd. Solar is not hard to install....

Instead of spending $4k to save ~$25-$30 per month (a claim FAR more dubious than proven physics) with solar thermal you could have spent $1300 on a heat pump to save ~$20-$25 per month and spent the remaining $1500 on some solar PV to save even more This is why I don't like solar thermal.... it's not cost effective....

I've been trying to explain the ROI to this guy for a year, it's a brick wall. Buying a properly sized array in Florida for anything south of $2.60/W will save you tons of money. Period. Even financing it will still be less money out of pocket each month then free solar after the panels are paid off.

This is a good illustration of why local installers are having a tough time in the US. Barriers to entry for an electrician are minimal, but moving into new solar markets you'd be having this same conversation over and over and over again. There's so much sales effort that it's tough to offer good pricing. Then you get steamrolled by a bigger operator who can more easily facilitate and eat the sales cost.

It's coming back around though. Local installers are having a much easier time these days. Consumers are getting educated.