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New Solar Policy Playbook Calls for Greater Cooperation, Not Competition, With China

March 23, 2017

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The quest to make solar energy a major source of the world’s electricity will not succeed if national policies and industries compete as though it is a zero-sum game. 

That is just one of many findings of The New Solar System, a sprawling report released earlier this week by Stanford University’s Steyer-Taylor Center for Energy Policy and Finance, a joint research center that includes the university’s business and law schools. The result of two years of work -- including interviews with dozens of government officials and industry executives in China and the U.S. -- the report sketches out a future where the scale of solar depends on self-interested cooperation.

The New Solar System does not seek to enable any country to beat another in the global solar industry. It seeks instead to help all countries find their most effective places,” wrote the report’s authors, Jeffrey Ball, Dan Reicher, Xiaojing Sun and Caitlin Pollock.

Though they acknowledge this concept may be idealistic, they insist that emphasizing the strengths of individual countries and tailoring policies to support those strengths will result in the kind of cost reductions required to reach meaningful scale.

Above all, the report argues, subsidies and other financial support for solar offered by state, local and national governments must take a long view in terms of supporting what an individual country does well. This will ensure that financial support continues pushing costs down, but also improves the odds that those investments reap meaningful long-term benefits.

Take the example of manufacturing. “Today, governments fashion certain solar policies largely for short-term economic gain -- in many cases, to [generate] a relatively small number of highly subsidized domestic manufacturing jobs,” write the authors. “A more effective and efficient approach would involve governments assessing and then fashioning polices that played to their jurisdictions’ specific comparative advantages in solar manufacturing.”

To be sure, this kind of approach to solar subsidies and policies would be a departure from the past, which has seen a mixture of overly generous incentives (e.g., the Spanish feed-in tariff) that led to unsustainable booms followed by miserly or nonexistent support that causes industries and companies to die (e.g., Spain today).

It has also led to international trade wars as countries seek to protect domestic manufacturing that would likely not be competitive without tariffs -- a development that has not helped the solar industry to cut costs as aggressively as it could. 

China’s pre-eminence

In the policy jigsaw puzzle that the report’s authors envision, China is an understandably large piece. Because it dominates both solar manufacturing and solar deployment, China impacts the direction and potential strengths of the solar industry in countries around the world. A deep understanding of the Chinese industry and its direction, argue the authors, is essential in order for the U.S. to devise and pursue policies that play to American strengths, particularly in research and development (R&D).

But the report also argues that the West's fundamental understanding of China’s solar industry is riddled with myths. The authors attempt to bust five major misconceptions.

1. The Chinese industry is in dire financial condition. China became the world’s leader in manufacturing by relentlessly pursuing a strategy of expanding capacity to win market share. That strategy worked for a time, but it also led a number of once-dominant manufacturers to struggle mightily. Nevertheless, the report’s authors point out that over the long term, consolidation is creating a smaller number of larger and more vibrant Chinese companies able to compete globally.

2. Chinese manufacturers don’t innovate. As the report points out, it has long been believed in the West that Chinese solar manufacturers are good at one thing: taking the technological advances devised in places like Germany and the U.S. and employing them at scale in order to drive down costs. But that conventional wisdom is mistaken, the authors assert, as China has become more sophisticated in the R&D realm. Just one example is Trina achieving the world record for efficiency of a research-scale multicrystalline silicon solar cell.

3. The solar industry is centralizing in China. Rather than a global industry concentrated in just one country, China, the report finds that it is decentralizing around the world. As manufacturers consolidate, they are also spreading their R&D, manufacturing and deployment activities far from China’s borders. “This is an important sign of industry maturation. It resembles transformative stages in the growth of other global manufacturing sectors, from automobiles to electronics,” according to the authors.

4. U.S. and European tariffs have hurt Chinese manufacturers. Far from financially crushing Chinese manufacturing, tariffs imposed by the U.S. and the European Union have only made the industry “leaner and stronger.” Those tariffs, the authors argue, have both failed to make the U.S. a major solar manufacturer and have resulted in retaliatory tariffs, which have harmed the one bright spot of American solar manufacturing: polysilicon production.

5. China is closed to foreign investment. Along with becoming a manufacturing behemoth, China also sprinted into the lead in the deployment of solar -- going from just 800 megawatts installed at the end of 2010 to around 76,500 megawatts at the end of last year. But Chinese government and industry officials recognize that the country needs outside capital in order to grow solar installations and allow China to reach its climate targets. This is an opportunity for foreign investment.

Where America fits in

China’s outsized and evolving role in the global solar industry needs to be acknowledged in order to develop better U.S. policies that will maximize domestic economic benefits and encourage ongoing cost cuts. To promote those goals, the report’s authors outline three underlying priorities and a raft of specific recommendations to guide U.S. policy.

The priorities begin with reducing solar costs. Although recognizing the impressive cost declines achieved over the past decade, the report highlights how much remains to be done. Policies should accelerate progress toward the Department of Energy’s (DOE) targets of unsubsidized cost targets of $0.03 per kilowatt-hour for utility-scale solar, $0.04 for commercial solar, and $0.05 for rooftop solar by 2030.

The second priority for policymakers outlined in the report is to embrace solar as a globalizing industry. This means devising policies aimed at enhancing U.S. advantages rather than punishing and defeating China.

The final priority is to focus the federal government on R&D and deployment. “Solar manufacturing is unlikely to produce large numbers of U.S. jobs, because it is an increasingly automated process,” state the authors. “The majority of solar jobs are in areas other than manufacturing: in sales, installation, operation, and R&D.” 

The report translates those priorities into a wide range of specific policy recommendations, covering R&D, manufacturing and deployment. The recommendations include:

  • A big increase in R&D spending for solar, particularly in storage and transmission technologies that address the intermittent nature and delivery challenges of the technology.
  • Broadened international solar R&D efforts that include China. “For the United States, cooperating with China on solar R&D poses real and important challenges, including concerns about the protection of intellectual property and national security,” the authors note. But failing to cooperate with China has even bigger risks, including not benefiting from China’s advances in silicon-focused research.
  • Reforms in federal policy that require recipients of R&D funding to manufacture their technologies primarily in the U.S.
  • A focus of solar manufacturing support on products that are expensive to import to the U.S.; that can be exported at scale and produced cost-effectively because of cheap natural gas; and export products developed and initially manufactured in the U.S. in small amounts but later shifted overseas for large-scale production.
  • To bolster deployment, the report argues for a “significant” U.S. price on carbon, a continuation of the Clean Power Plan, resolution of state-level net-metering disputes and ongoing support of state renewable portfolio standards (RPS).

The Trump factor

It’s difficult to read the policy recommendations in The New Solar System and not think of the Trump administration’s hostile attitude toward clean energy and policies to curb climate change. The authors of the report don’t ignore this reality, and they quote extensively from Trump’s 2015 book, Crippled America: How to Make America Great Again.

In it, Trump dismisses solar as too expensive and requiring too many subsidies. Trump’s attitudes toward China and tougher trade measures also make it difficult to foresee greater collaboration on many issues, particularly solar energy. 

Still, in an opinion piece in The New York Times, two of the report’s authors, Jeffrey Ball and Dan Reicher, find a sliver of hope in the president’s own words in Crippled America. In the book, Trump says that when solar is affordable and reliable, it may be worth discussing. We've already reached that point, argue Ball and Reicher.

“That time has arrived. A smarter solar policy -- one with a more nuanced view of China -- is something the new president ought to like,” they state. 

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This Week in Batteries: Parsing a Banner Year for Storage [GTM Squared]

March 22, 2017

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California’s Flood of Green Energy Could Drive a Record 8GW of Curtailment This Spring

March 21, 2017

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Last month, the California Independent System Operator quietly announced that it could face a record-breaking need for curtailments -- paying, or forcing, generators to stop pumping electricity into a transmission grid that just doesn’t have the demand for it at the time. 

“With the bountiful hydro conditions expected this year and significant additional solar installations both in the form of central station and on rooftops, we expect to see significant excess energy production this coming spring,” CAISO CEO Stephen Berberich wrote in a memo to the grid operator’s board of directors. “Currently, the forecast is that we could have the need to curtail from 6,000 [megawatts] to 8,000 [megawatts].”

Managing oversupply conditions isn't new to CAISO, spokesperson Steven Greenlee said. But, he added, “We haven’t had this potential amount of excess supply on the grid before.” 

The biggest contributor is the heavy rain and snow that has helped California fill its depleted reservoirs. Many of them are now so full that they’re likely to go into "spill" mode this spring, Greenlee said. And “when they’re in spill and they’re generating electricity, we have to take that electricity, because they can’t turn their generators off."

California hasn’t had so much hydro power coming on-line since 2011, he said. And that was years before solar power became a significant contributor to the state’s midday energy mix. “We didn’t really start adding solar until 2014,” he said. But CAISO has added about 2,000 megawatts per year since then, totaling 9,792 megawatts in June of last year. “We expect it’s going to [bring on-line] another 2,000 megawatts from 2016 to 2017,” he said. 

All of this solar has led to what CAISO calls the “duck curve” -- a deep dip in demand during solar-saturated midday hours, followed by a steep ramp as solar fades away. And this supply-demand pattern is happening even faster than CAISO first predicted in 2013, he said. An analysis by energy consultancy ScottMadden found that California is about two years ahead of CAISO’s duck curve schedule, in terms of the lows it’s hitting on certain sunny, mild spring days, when solar power surges and air conditioners aren’t being turned on to soak it up. 

Add must-take hydro to the mix, and California is looking at a combination of clean energy resources at volumes it hasn’t faced before, Greenlee said.

CAISO’s curtailment plan: From "decremental" bids to "exceptional dispatch"

Curtailment is generally the last step in a long process governed by CAISO, as manager of a commodity market that has to be kept in perfect balance at all times. First of all, when supply of power of any kind exceeds demand, prices drop, and generators can reduce output in response, if they have the flexibility and economic incentives to do so, Greenlee said. 

Of course, most of CAISO’s oversupply is coming from generation resources that lack that flexibility, which has led to an increasing incidence of negative pricing.

CAISO’s next step is to offer generators the opportunity to make money by reducing their power output, he said. “Once we go into an excess or oversupply condition, our market first goes out and sends signals to the generators that say, ‘How much would you take, bid in as a price, to reduce or quit producing?’”

That’s called a "decremental" bid, as opposed to an incremental bid that pays generators to increase production, and through it, “The market solves that oversupply almost in every instance,” he said.

If all of these market measures fail to bring supply in balance with demand, “We will go in and start manually intervening in the market,” he said. “We will cut self-schedules, and if that hasn’t worked, we will ‘exceptionally dispatch’ units to go offline.” 

These manual "exceptional dispatch" interventions do occasionally happen, he said. But they’re very rare. Out of the 240 million megawatt-hours or so that CAISO delivered in 2016, it curtailed about 308,000 megawatt-hours, almost all of it through decremental bids. Self-scheduled cuts and manual interventions made up 1 percent or less of that total, he said. 

But “unless we take actions to mitigate the excess supply, the times we’ll have to manually intervene in the market will increase,” he said. "We’re seeing our oversupply earlier than what we have forecasted. We’ve got to keep pressing on and implementing new solutions." 

Looking for solutions: Flexible solar farms, broader grid markets, time-of-use pricing

CAISO has far fewer levers to pull on the demand side of the equation, Greenlee noted. California does have hundreds of megawatts of demand response, of course. But that doesn’t really help solve the oversupply problem, since it’s set up to get customers to reduce their power use. A demand-side effort to solve curtailment would instead encourage people to use more electricity, he said. 

That could happen through time-of-use pricing schedules or special tariffs that offer exceptionally low prices, or even direct payments, during periods of oversupply. California is in the midst of shifting all of its big utilities to time-of-use rates by 2020, and CAISO is working with the California Public Utilities Commission to “develop the rate tiers to incentivize people to use excess energy when we have it, which is now in the mid-mornings to mid-afternoons,” Greenlee said. “That’s kind of a flip -- it used to be that the rates would disincentivize use during that time.” 

CAISO is also increasingly relying on its links to the broader U.S. Western grid, he noted. In 2014, it expanded its Energy Imbalance Market to include Rocky Mountain state utility PacifiCorp, as well as Nevada utility NV Energy. This real-time market is useful to find demand for excess energy, in what CAISO calls “avoided curtailment,” he said. This chart shows that most of the transfers are happening during the same midday hours that solar is generating at its peak, indicating the source of the megawatts being exported. 

CAISO also wants the California legislature to pass a law allowing it to expand its balancing authority, said Greenlee. “Then we could optimize all of those resources in the day-ahead timeframe, rather than dealing with excess supply through our real time Energy Imbalance Market,” he said. Day-ahead markets are a lot easier to participate in than real-time markets, opening up a broader potential customer base. CAISO’s plans were put on hold during last year’s busy legislative session, but Senate Bill 350, the omnibus energy bill passed last year, requires that the state explore it as part of its renewable energy goals. 

While solar farms are the main driver of the duck curve, they don’t have to just be passive providers of power, he added. Last year, CAISO joined First Solar and the National Renewable Energy Laboratory (NREL) in a project to prove that PV farms can shape and shift energy output through advanced inverter controls, in ways that could rival natural-gas-fired speaker plants, at least in terms of fast-acting frequency response. 

But as more solar comes on-line, curtailments are likely to increase, which could create an “economic limit to deployment” for solar power in California, as NREL noted in a recent study on the state’s 50 percent by 2030 renewable portfolio standard goals. “If we have to start turning renewables down or off, it undermines the effort to reach the goal that the renewable portfolio standard sets,” Greenlee said. 

CAISO has predicted that it will see 13,000 megawatts of solar power on the grid by 2020, giving the state “thousands and thousands of megawatts we’re going to have to deal with,” he added. “We’re already being proactive in looking for solutions,” such as launching the country’s first market opportunity for distributed energy resource providers, or DERPs, to aggregate solar, demand response, energy storage, electric vehicles or other flexible loads into resources for its energy market. 

At the same time, CAISO’s role has its limits, Greenlee said. It doesn’t track demand by end user -- “All we do is get a schedule in that says to deliver 100 megawatts of electricity to four hours to a particular substation.” That means it doesn’t directly track what’s going on with rooftop solar on the distribution grid, besides seeing it as a reduction of load. “That’s behind the meter, and we’re still wholesale.” 

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Destructive or Merely a Shift in Focus? What Trump’s Budget Plan Means for Clean Energy

March 21, 2017

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President Trump unveiled a controversial budget blueprint last week that seeks to boost defense spending by $54 billion, and slash non-defense spending by the same amount -- affecting several key clean energy programs.

The Environmental Protection Agency would see the biggest budget cuts of any government agency under Trump's plan, falling by 31 percent or $2.6 billion. As a result, the EPA would have to shed approximately 3,200 of its 15,000 employees.

The proposed budget also “discontinues funding for the Clean Power Plan, international climate change programs, climate change research and partnership programs, and related efforts,” according to the blueprint.

The Department of Energy would see a 6 percent budget decrease, including a $900 million, or 20 percent cut to the Office of Science, which supports more than 300 universities and 10 of the 17 U.S. national labs. Trump has also proposed to eliminate the Loan Programs Office, which invests in the deployment of innovative clean energy technologies, as well as Advanced Research Projects Agency-Energy (ARPA-E), a widely supported program designed to progress early-stage energy technology.

For many, the budget is disappointing and even dangerous. Democrat House Minority Leader Nancy Pelosi called Trump’s plan a “systemic deconstruction of the federal government and its role.”

But the proposal still has to be approved by Congress. And how it will all shake out for clean energy may be a matter of perspective on the broader role of government, as Democrat and Republican energy policy experts explained in GTM's latest Facebook Live interview.

For Brandon Hurlbut, partner at the advisory firm Boundary Stone Partners and former chief of staff for Energy Secretary Steven Chu, the budget is simply “terrible.” Hurlbut pointed out that the 6 percent DOE budget cut is actually much larger when you look specifically at the impacts on non-defense programs. About two-thirds of the DOE’s budget is related to the U.S. nuclear weapons program. Trump’s budget blueprint increases spending on nuclear weapons by about 11 percent, and cuts everything else by about 18 percent.

"Everything else" includes fundamental research conducted at the national laboratories, as well as applied energy programs at the Office of Electricity Delivery and Energy Reliability, the Office of Nuclear Energy, the Office of Fossil Energy Research and Development, and the Office of Energy Efficiency and Renewable Energy.

“That’s a pretty drastic reduction in investments we could make in basic science and things that have been bipartisan in the past, and the foundation of the innovation machine our economy relies on,” said Hurlbut. It’s also a drastic reduction in government spending on “this new energy economy,” he said.

For Shane Skelton, founder of the consulting firm S2C Pacific and former energy policy advisor to Paul Ryan, Trump’s budget isn’t as extreme as some make it out to be. For one thing, the $54 billion in budget cuts and commensurate defense spending increase is tiny when compared to the $4 trillion the U.S. government is expected to spend this year, according to the Congressional Budget Office. The worrisome part is where, exactly, the budget cuts end up taking place, said Skelton, who characterizes himself as a true all-of-the-above energy supporter. 

“I’m of the mind more money isn’t always the better solution, so I think the numbers alone shouldn’t alarm any of us,” he said. “What’s concerning is that the budget says it’s going to focus on basic R&D and not as much on commercialization and market readiness, but some programs zeroed out focus on basic R&D and not commercialization. I think that’s concerning as far as a marker of where this budget’s priorities are…because I’m not sure how you perform basic R&D without programs and offices that focus on basic R&D.”

“The commercialization side, I would posit, is much better suited to the private sector, and I’m not too concerned about a couple of billion dollars at the Office of Energy Efficiency and Renewable Energy that won’t be spent on commercializing technologies,” he continued. “At this point, I think the global community and business community has sent a pretty clear signal that climate change is real and it’s something they’re concerned about. […] Whether or not your government is going to combat it isn’t going to change the way global private equity firms behave, equity firms behave and pensions behave.”

“There is going to need to be a focus on combating climate change, but I think the focus of this budget is whether it’s coming from taxpayer dollars or from industry,” said Skelton.

Listen to the full conversation with Brandon Hurlbut and Shane Skelton in our ongoing Facebook Live series on the implications for clean energy under the Trump administration. Follow Greentech Media on Facebook for more.

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Ernest Moniz Is Heading Back to MIT to Keep Focused on the Clean Energy Transition

March 21, 2017

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MIT News: Celebrating the Homecoming of Ernest Moniz

After more than three and a half years of service as the 13th U.S. Secretary of Energy, nuclear physicist Ernest J. Moniz has returned to his roots at MIT, the place where he served most of his professional career.

Nominated to the cabinet by President Barack Obama in March 2013 and confirmed by the Senate on May 16 in a unanimous vote -- a rare occurrence in a polarized political atmosphere -- Moniz left the office on Jan. 20, 2017, with the arrival of the Trump administration.

Now, he intends to build upon that experience by working on policy proposals for climate solutions through clean energy innovation, as well as in the area of nuclear security. In addition to serving in a part-time appointment at MIT as professor of physics post-tenure and special advisor to the president, and as a nonresident senior fellow at Harvard University’s Belfer Center for Science and International Affairs, he also intends to do additional work in clean energy through a nonprofit organization of his own.

IEEE Spectrum: Efficiency of Silicon Solar Cells Climbs

In research published this week in Nature Energy, researchers at Kaneka Corporation, a resin and plastics manufacturer based in Osaka, Japan, describe the first silicon solar cell to achieve a record-breaking 26.3 percent efficiency -- a 0.7 percent increase over the previous record. That may not seem like a lot, but it’s really a big step when you consider that silicon solar cells’ theoretical maximum efficiency is just 29 percent.

In producing its new 180.43-square-centimeter monocrystalline silicon prototype cell, Kaneka further developed and improved on several of the technologies promoted by NEDO. Chief among them is Kaneka’s proprietary heterojunction technology. It reduces recombination, or resistive loss, where instead of exiting the device to produce electricity, positive and negative charges in the solar cell combine and produce heat.

Axios: The Coal Industry Is Sick -- and It's Terminal

Even if President Trump magically resurrected the coal industry, that doesn't mean that jobs would come back. Automation is a much more immediate threat than over-regulation.

In 2008, the coal industry hit its greatest production ever right around the time that employment numbers bottomed out. That's largely due to a geographic shift in production. Trump has made it a point to highlight the plight of miners across Appalachia, but the industry has undergone a clear and steady shift away from underground mining in that region to surface mining in the West.

Washington Post: How James Inhofe Is Upending the Nation's Energy and Environmental Policies

For more than a decade, Sen. James M. Inhofe has raged against the scientific consensus that humans are fueling climate change, calling it “the greatest hoax” ever perpetrated on Americans. The Oklahoma Republican has blasted the Environmental Protection Agency as an “activist organization” that has unfairly burdened everyone from farmers to fossil-fuel companies.

Now the man critics once dismissed as a political outlier has an unprecedented opportunity to shape the nation’s energy and ­environmental policies. And he has helped populate the upper ranks of the agency he has derided with several of his closest confidants.

At least half a dozen former aides to Inhofe -- and counting -- have been hired into top positions at the EPA and the White House. The chief of staff and deputy chief of staff to EPA Administrator Scott Pruitt, a fellow Oklahoman and longtime friend of Inhofe, spent years working for the senator. Pruitt’s senior advisers on air, climate and legal issues are Inhofe alumni. In addition, two former Inhofe aides have become top domestic and international energy and environmental advisers to President Trump.

Auto Blog: Hyperloop Transportation Technologies Is Building a Full-Sized Capsule

The race to construct a working hyperloop system is reaching the endgame. It was recently reported that Hyperloop One built a development "test tube" in Las Vegas. The company aims to build a commercial hyperloop transport system between Dubai and Abu Dhabi, transporting people from A to B in 12 minutes. H1's test track is 500 meters in length, and the startup tested a prototype system in May of 2016.

Now, H1's competitor Hyperloop Transportation Technologies, or HTT has begun building what they call the world's first full-scale passenger hyperloop capsule. HTT's R&D center is in Toulouse, France, and the plans call for the capsule's official reveal in early 2018. According to HTT, the construction of the capsule comes after three years of research and development, and it's being built in collaboration with Carbures S.A. Carbures is an aeronautics and aerospace material specialist with production on three continents.

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Energy Jobs: Bring California Your Tired, Your Poor, Your Federal Scientists and Climate Experts

March 20, 2017

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Last week, California Public Utilities Commission President Michael Picker gave out fliers in front of the Washington, D.C. offices of the Environmental Protection Agency and Department of Energy. The fliers pointed to a webpage listing openings at California's PUC, Air Resources Board and Energy Commission.

Picker said, “On climate action, there’s a dark cloud hanging over Washington right now. If climate scientists and experts want the opportunity to continue doing important work for the good of our planet, my message is simple: Come West; California is hiring.”

President Trump intends to nominate Scott Gottlieb, a partner at venture capital firm New Enterprise Associates, to lead the Food and Drug Administration, according to Reuters. Trump intends to nominate Kevin McIntyre, a lawyer at Jones Day in Washington, D.C. to be chair of FERC, according to Bloomberg.  

Gary Clark, the IT CTO at Juniper Networks, joined Tesla earlier this year as its CIO, according to Clark's LinkedIn profile.

How is the Telsa-SolarCity PV-integrated roofing project going? Well, the company has a growing number job of openings, 36 listed here, for roofers.      

Bruce Sohn, former president of First Solar, joined CIGS solar startup Siva Power as CEO after joining as vice chairman late last year. Under Sohn, First Solar was the first firm to build PV modules at below $1.00 per watt and the first to ship more than 1 gigawatt of PV modules annually. Sohn is on the board of Phononic Devices and 1366 Technologies and, until recently, was president of QuantumScape.  

Travis Bradford, president of the Prometheus Institute for Sustainable Development and director of the Energy and Environment graduate program at Columbia University's School of International Public Affairs, is now the new chairman of Watt Fuel Cell Corp, a developer of a solid oxide fuel cell that runs on propane, natural gas and diesel. According to the company, the entire fuel cell tube is manufactured using an automated printing process.

Vivint Solar, a residential solar provider, promoted Colt Reid to VP of sales operations. 

SMA promoted Charles Ellis to VP of distributed sales. Andrew Mears, most recently with SunPower, and with SMA America from 2009 to 2013, is now VP of strategic sales. SMA "will be launching a massive hiring effort" in key U.S. regions such as California and the Northeast.

Brian Asparro is now CCO at behind-the-meter energy storage firm Demand Energy. Asparro "supported Demand Energy with financing expertise and guidance through the acquisition of the company by Enel Green Power North America." Previously, Brian served as CFO at Green Charge Networks.   

Gregg Sayre, on New York’s Public Service Commission since July 2012, will replace Audrey Zibelman as interim chair to oversee NY REV, according to Microgrid Knowledge. The REV program is building a policy framework for a distributed grid in New York state. Zibelman is moving on to lead the Australian Energy Market Operator.

Lidija Sekaric, previously a director, deputy director, and group manager with the DOE's SunShot Initiative, joined Siemens as the director or strategy and marketing for distributed energy systems.    

***

Enertech Search Partners, an executive search firm with a dedicated cleantech practice, is the sponsor of the GTM jobs column.

Among its many active searches, Enertech is looking for a VP of Sales -- Distributed Energy.

The client provides software and business solutions to design, connect, and operate energy storage and microgrid systems. Their suite of products creates an ecosystem where project developers, OEMs, financiers, and project operators can deploy advanced energy projects using a seamless hardware-agnostic software platform.

Currently they are seeking a VP of Sales who has superior communication and management experience, is comfortable selling and partnering with big integrators (SW) and is a strategic tactical player/coach.

***

J.W. Postal, former COO of Clean Energy Collective is now CEO of Nikola, a new solar/storage startup.

Lightsource Renewable Energy, a European solar energy developer, named James Brooks as chief strategy officer, and as a member of the board. Most recently, Brooks was the co-head of energy investments in the merchant banking division of Goldman Sachs within EMEA.

Sense named Marshall Chapin as chief strategy officer. Chapin joins Sense from EnerNOC, where he served as VP of sales, responsible for utility sales, strategic alliances, and sales operations. Sense is a "platform that interprets the power usage and activity of devices in the home." 

From the previous jobs column:

Gates, Bezos, Khosla, Bloomberg, Branson, Doerr, Plattner and the other billionaire investors in the $1 billion Breakthrough Energy Coalition have hired folks with actual energy backgrounds.

David Danielson is now managing director for science and Eric Toone is executive managing director and science lead -- the first employees on the Breakthrough Energy Ventures science team. Danielson was most recently a Precourt Energy Scholar at Stanford. Before that, he served as the Assistant Secretary for Energy Efficiency and Renewable Energy. He was the first program director hired by the DOE's Advanced Research Projects Agency-Energy (ARPA-E), which focuses on high-risk clean energy technologies. Toone was most recently the leader of the Innovation and Entrepreneurship Initiative at Duke University. In 2009, he was a founding member of ARPA-E, where he led the electrofuels program.

On the relatively rare topic of investors focused on energy and sustainability:

  • Dick Kramlich, co-founder of New Enterprise Associates, founded Green Bay Ventures, a $130 million early-stage fund, with partner Anthony Schiller. The fund looks at artificial intelligence applications in energy, transportation, manufacturing and logistics, according to a TechCrunch source.
  • Abe Yokell, a partner at RockPort Capital, along with Joshua Posamentier are listed as co-founders and managing partners at Congruent Ventures -- "Investing in Early Stage Sustainable Technology" according to the website.  The firm has filed for two funds, a $50 million seed and Series A fund, and a $40 million follow-on fund.  According to the firm, they are fully subscribed on their follow-on fund and will hold a second close for the early stage fund in Q2. They expect to make their first investments in the coming months.
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Sunverge Tests New Software Control Platform on ‘World’s Largest’ Virtual Power Plant

March 20, 2017

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Australian utility AGL Energy held a press event last week to publicize what the company claims will soon become the largest behind-the-meter battery installation in the world.

The installation is relatively small at the moment -- only residential 60 batteries have been installed to date, out of 150 to be deployed by the end of this quarter. But by next year, AGL plans to have 1,000 of them running as a virtual power plant (VPP) to keep lights on during power outages, and provide a variety of grid services that will help accelerate Australia's shift to renewable energy. 

AGL’s AUD $20 million (USD $15 million) VPP project is also a big win for California startup Sunverge. Not only is it providing all of the solar-battery control systems installed by the utility so far, it’s also been tapped to provide the software control platform that will eventually extend to all 1,000 units -- and, potentially, to energy resources beyond batteries. 

“Sunverge in partnership with AGL will be providing the orchestration capability. This is a joint internet-of-things effort for the full fleet of batteries, managing their deployment to demonstrate the services required to realize a number of different value streams -- for the customer, for the transmission and distribution networks, and for AGL as a retailer,” Andy Vesey, the utility’s CEO, said in an email last week. 

The utility, which is also an investor in Sunverge, has already begun demonstrating VPP functions, such as aggregated peak demand management and frequency control, and expects to publish a report on that progress in May, he said. At the same time, the first installed units have already helped customers ride through some of the blackouts that have struck Southern Australia in recent months, he said. 

For Sunverge, which announced last month that it’s branching out from controlling its own hardware to providing its control platform as a software-as-a-service product, it’s an important testing case. While the startup has about 1,000 of its own battery systems deployed worldwide, it never planned to go head-to-head with giant Asian battery manufacturers, or upstart hardware competitors, such as Tesla, CEO Ken Munson said. 

Instead, “it was always our intent that we would learn from a fleet of assets, and that would inform how we build a more robust platform,” Munson said in an interview last week. “At some point we knew we would have the ability to abstract that software over other hardware,” and work with “other best-of-class batteries and inverter technologies, further enabling the industry to increase the rate of adoption of renewables onto the grid.” 

AGL hasn’t yet picked which different battery manufacturers it will be working with for its entire 1,000-unit VPP deployment. So far, Sunverge is working on integrating its software platform with various different technologies, and is “in discussions with three or four different battery technologies,” including LG Chem and Sony, “and three or four different energy storage providers coming to market,” Munson said. 

“We can integrate at two different layers,” he noted. The first involves a good deal of precise work with battery and inverter systems before deployment, and can “offer nearly all the same ancillary services and behind the meter services that we can do on our own software stack. But we also see that the market doesn’t always want the many robust feature sets,” and Sunverge offers a lower-cost option for customers that would prefer to enable a simpler set of grid controls, he said. 

Australia has been an important early market for behind-the-meter batteries, with well-known brands such as Tesla and Sonnen competing against companies like China’s Narada Power and Australia’s Redflow. GTM Research predicts that Australia’s energy storage market could grow 37-fold between 2015 and 2020, reaching an annual installation rate of 244 megawatts. The vast majority of this growth is happening behind the meter, predominantly as add-ons to existing residential solar systems. 

Sunverge is already a key partner in a 300-battery VPP project with New York utility Con Edison, which held the title of "world’s largest" before AGL’s was announced. Sunverge is also working with utility Xcel Energy, Panasonic, Younicos and other partners on a $10.3 million microgrid development under construction near Denver’s airport. “Xcel is keen to test our software,” Munson said, “from experimental rate design, all the way through backup power.”

Sunverge expects to announce two more partners for its software-as-a-service platform in the next four to six weeks, he added. 

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There’s Vast Untapped Potential for Solar Rooftops in the US, Says Google

March 17, 2017

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When Google first launched a website two years ago that collects data on solar rooftops, called Project Sunroof, it only covered a few cities. But this week, the search engine giant announced the solar site is now crunching data for every single U.S. state, including 60 million rooftops across the country.

The expansion means that Google’s Project Sunroof is starting to get a much clearer picture of how much rooftop solar capacity there actually is in the U.S. Project Sunroof uses data from Google Maps and Google Earth, combined with 3-D modeling and machine learning to determine the solar electricity potential of individual roofs.

Potential solar customers -- or just the solar-curious -- can enter their addresses into the site and get information about how much a solar system on their roof might cost and how much money they might save over time by going solar.

Google’s product manager Joel Conkling told GTM the goal of Project Sunroof is “to get data into the hands of people thinking about solar, and who are making decisions about solar.” He added that “the hope is [to] help people make more quantitative decisions about solar.”

The large amount of data being collected by Google also means that the internet company’s project could be a helpful tool not only for consumers interested in solar, but also for solar companies looking to bring in new customers, as well as academic researchers and even utilities.

Now that Project Sunroof's availability is countrywide, Google’s amassed data has started to reveal some interesting trends and information. For one thing, Google says that 79 percent of the rooftops it’s analyzed are viable for solar, which is good news for rooftop solar providers.

That doesn’t mean that 79 percent of rooftops should or will adopt solar, though. Rather, it means that 79 percent technically get enough sun to be able to accommodate solar panels.

That finding is likely a generous interpretation of the data. For comparison (though it’s not apples-to-apples), a National Renewable Energy Laboratory analysis from January 2016 -- arguably the best technical analysis to date -- found that the rooftop space on all buildings in the U.S. could generate about 39 percent of total national electricity sales. The NREL report, which uses data from lidar and software modeling, also found that a sunny state like California could generate 74 percent of the electricity sold by utilities in the state.

Solar industry watchers know that sun potential is only a part of the equation for when a customer decides to go solar. Other major factors include state renewable energy targets, net metering rates, tax credits and available financing.

While keeping that in mind, Project Sunroof still plays a role in exploring the upper end of what’s possible. Google’s Conkling says Project Sunroof is specifically meant to report on the technical potential of solar. Google does include economic data in its solar price quote for users based on address and ZIP code. But Project Sunroof does not offer a comprehensive view of the rooftop solar market.

Project Sunroof Coverage 2017

When it comes to super-sunny states, like Hawaii, Arizona, New Mexico and Nevada, 90 percent of rooftops are viable, according to Google. States like Pennsylvania, Maine and Minnesota have just slightly more than 60 percent viability.

The mention of Nevada’s blockbuster solar potential could be a kick in the gut for solar companies that were once operating robust rooftop PV businesses in the state. Those companies left Nevada after utility regulators changed the rates and fees for solar customers, making it far less economical. SolarCity saw its Nevada solar roof business fall off a cliff in 2016 after the policy change.

Hawaii, which has a state goal to have 100 percent clean energy by 2045, has also been growing its number of solar roofs at a rapid clip. However, in 2015, the state also changed its rate structure, leading to slower rooftop solar growth since then.

The city with the most solar potential is Houston, Texas, says Google, with an opportunity to generate close to 19 gigawatt-hours of electricity from solar rooftops per year. Houston, of course, already hosts a huge energy industry presence of oil and gas, and Texas has the largest wind energy industry in the U.S. Perhaps rooftop solar could take off there, too.

There are only two California locations on Google’s top 10 list of cities with the most solar potential -- Los Angeles and San Diego. California currently accounts for a large portion of all the installed solar in the U.S. on both rooftops and in those sprawling utility-scale ground deployments.

Google says that if these top 10 cities were able to reach their potential, they would be able to generate enough electricity to power 8 million homes.

So what’s holding these cities back? Likely a mix of policy, economics and financing, as well as a lack of information, education and interest.

The big nationwide solar companies have been spending exorbitant amounts of money marketing to customers and trying to close solar deals, which can be difficult. SolarCity plans to cut those costs a lot this year after its acquisition by Tesla, which is a nationally known brand and led by tech celebrity Elon Musk.

Project Sunroof can help with the marketing process by sending leads to solar installers like Vivint Solar, SolarCity and Sunrun. Google’s Conkling says that Google doesn’t currently make any money on generating leads for these companies and at this point has no plans to make Project Sunroof more commercially oriented.

But like all data-based models, Google’s methodology seems to have some limitations. Google's aerial imagery is used to estimate the solar potential, but, as Google admits, that data is not always entirely precise or up-to-date. Newer buildings may not be included, and large building-like objects, like bridges, could be mistakenly included. Some roof obstacles like vents are also too small to be seen by the satellite image data, says Google.

The biggest limitation of the model is that it doesn’t include economic factors in its overall solar comparison (it does in its individual price estimates). Solar is highly dependent on a variety of factors beyond just how much sun falls on a roof. Conkling says Project Sunroof is meant to be just one part of the equation about solar data.

While Conkling wouldn’t speculate on future plans for Project Sunroof, he said: “We feel like we’ve put some good data and tools out there...but there’s a lot more that we can do for people who are exploring solar.”

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Vivint Solar Posts Modest Results After Its Near-Death Experience With SunEdison

March 17, 2017

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Residential installer Vivint Solar just reported mixed financial results in what has already been a tough year for solar power companies, residential and otherwise. GTM has covered the restructuring and transitional themes this earnings season at First Solar, SunPower, SolarEdge and Enphase.

Although the U.S. solar market had a record-breaking 2016 and is poised to triple in the next five years, this same buoyant market has SolarCity taking shelter within TeslaSungevity bankrupt and sold to a private equity firm for $20 million, and NRG retreating from the residential solar business. Sunrun is one of few large solar companies to report controlled growth and a functional business model.

Investor Andrew Beebe has written on the revenge of the long tail as smaller solar installers take advantage of lower equipment costs, lower customer acquisition costs and the emergence of loans over power-purchase agreements.

In the second and third quarters of 2016, Vivint was able to keep some momentum in revenue and deployment after its near-acquisition by (and near-death experience with) now-bankrupt SunEdison.

Q4 2016 operational and financial results

  • Booked ~57 megawatts 
  • Installed ~47 megawatts, its smallest quarterly figure since Q1 2015 for a 2016 install total of 222 megawatts
  • Installed solar on 6,460 rooftops for a cumulative 99,598 roofs and 681 megawatts
  • Increased estimated retained value by ~$86 million to $1.3 billion
  • Cost-per-watt was $3.08, an increase from the third quarter of 2016 and down from $3.12 in the fourth quarter of 2015

Full year 2016 financial results

  • Operating leases and incentives revenue was $105.4 million, up 72 percent from $61.2 million in 2015
  • Loss from operations was $202.5 million compared to $231.1 million in 2015

Guidance for Q1 and 2017

For the first quarter of 2017, Vivint expects to install 43 megawatts to 46 megawatts at a cost per watt in the range of $2.95 to $3.05. For the full year, Vivint expects to install 210 megawatts to 230 megawatts at a cost per watt in the range of $2.82 to $2.94.

Vivint Solar CEO David Bywater said that the firm is “quite comfortable as we look through 2017 in terms of our current cash balance and capital structure."

Vivint stock is up about 3 percent today to $2.82 per share.

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EDF Renewable Energy Joins the Fray With New Distributed Energy Business

March 17, 2017

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EDF Renewable Energy, a leading developer of large-scale wind and solar projects in the U.S., has entered the distributed energy arena with the launch of a new business unit named Distributed Electricity and Storage.

The new division is focused on deploying solar and energy storage projects up to 30 megawatts, and leveraging the experience of French-owned parent company EDF Group to provide a suite of products and services to commercial, industrial and utility customers.

Distributed Electricity and Storage (DES) was officially announced this week, but the unit has been in the works since last April, when EDF RE announced the acquisition of groSolar -- a developer and EPC provider with a successful track record of deploying C&I and municipal solar projects. Over the past 18 years, groSolar has built more than 2,000 projects with over 250 megawatts installed. The acquisition of groSolar served as a springboard for the new business, which is headed by industry veterans Tom Leyden, former CEO of Solar Grid Storage, and Felix Aguayo, former managing director at SunEdison.

“Felix and I bring to the group a long history of pioneering large commercial solar projects and see opportunity to benefit customers with the multiple use cases you have with storage,” said Leyden, in an interview. C&I and utility customers are currently missing out on the opportunity to improve their reliability and reduce costs by not taking a more holistic approach to their energy procurement and asset utilization, he said.

EDF RE is hardly the only company looking to develop a comprehensive DER strategy aimed at serving C&I customers in the U.S., though. Edison International recently rebranded its energy services arm Edison Energy. Duke has been active in the commercial space through REC Solar and a partnership with energy storage startup Green Charge Networks. Last spring, Green Charge was acquired by the European utility Engie, which has made several recent investments in distributed energy startups. GE has attempted to expand and streamline its DER business through Current. And then there's Tesla/SolarCity, which has been steadily moving into the commercial space.

EDF RE’s advantage in this competitive landscape is that the company has a broad spectrum of capabilities, “and if you integrate them well, there’s a lot more value to the end customer,” said Leyden.

“There are very few companies that can do it all -- solar in front of the meter and behind the meter, wind, energy storage, sophisticated controls, load management -- and…[still serve as] an electricity commodity supplier,” he said. “When you integrate these all together, the business model is much more powerful than any of these things separately.”

According to Leyden, the value play goes something like this: Solar reduces a customer’s overall energy demand, while storage is used to shape the customer’s load, reducing peak demand and costs associated with load volatility. EDF can then use its analytic capability to look at the customer’s newly shaped load profile and offer an attractive retail electricity price. Combine all of that with EDF’s sophisticated controls, and the customer’s load can also be used as an asset that’s bid into markets, like demand response.

These capabilities put EDF RE in a prime position to help companies looking to go 100 percent renewable -- of which there are a growing number -- achieve that goal in just a year or two, Leyden said.

DES has yet to complete a project that incorporates the full suite of services, but Leyden said that all components of the new business unit have been successfully executed by EDF and groSolar in some form. In partnership with EDF's North American affiliates, the company offers a complete array of services, including energy supply, hedging and risk management, as well as demand response, load management, and on- and offsite renewable generation. EDF RE has developed 9 gigawatts of wind, solar, bioenergy and storage projects in North America to date. And parent company EDF Group has deployed more than 300 megawatts (824 megawatt-hours) of storage projects worldwide.

Most of those energy storage projects are in Europe, but a few are in the U.S., such as the McHenry Storage Project in Illinois, which adds 40 megawatts of flexible capacity (20 megawatts nameplate) to the PJM Regional Transmission Organization and is currently participating in both the regulation and capacity markets.

EDF has very little distributed energy storage experience so far, however. There are also persistent financing challenges for C&I renewable energy projects, which have made it difficult for the sector to take off. As a result, there have been very few C&I solar-plus-storage deals to date, according to GTM Research’s Ravi Manghani. Given this market reality, it will be interesting to see how the DES group differentiates itself in the space.

One of EDF’s defining characteristics is that it’s patient, said Leyden. As a large international company with a strong balance sheet, EDF can afford to take some time to get the business model right -- at a time when the distributed energy sector is still very much in flux.

“I think there’s creative chaos going on in the energy storage and solar sectors,” Leyden said. “But I think in the next couple of years that will shake out, and it will be a really exciting time in the industry to position ourselves to play a much greater role in overall energy use.”

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