Tag: "lg"

01/30/18

  03:28:00 pm, by Jim Jenal - Founder & CEO   , 689 words  
Categories: Solar Economics, Commercial Solar, Residential Solar

Solar Tariffs - What Does this Mean for You?

After months of discussion, the Trump administration imposed 30% tariffs on imported solar cells and completed solar modules (like the LG modules that we use exclusively). The news made a pretty big splash, but it has mostly left potential solar clients confused about what it really means. We are still sorting through this ourselves, but here are our preliminary thoughts.

How did we get here?

Last April, bankrupt panel manufacturer Suniva—operating out of Georgia, but actually a subsidiary of China’s Shunfeng International—filed a trade case claiming it was damaged by the “dumping” of inexpensive solar modules from China and elsewhere.  They sought trade protection in the form of tariffs to drive up the cost of competitor’s products, so that their panels would be cheap enough for people to purchase.  We wrote at length about this at the time: Suniva - the Tail Wagging the Dog

Shortly thereafter, SolarWorld—another manufacturer operating in Oregon, but German owned—joined the case.  The irony here is that some of the modules targeted by this trade case - like our LG modules - are already considerably more expensive than those made by Suniva or SolarWorld!

Moreover, solar module manufacturing tends to be highly automated, meaning there just aren’t that many jobs at issue; whereas rising prices could seriously impact solar installation jobs, which are far more numerous (and which can’t be outsourced, for that matter!). 

Despite all of that, the Administration imposed tariffs in the name of protecting American jobs.

What will this do to the cost of solar?

Which brings us to the obvious question of what will this cost consumers.  First and foremost, for our clients, if you have signed a contract with us, your cost will not change at all.  Indeed, our pricing changes on February 7, so contracts signed before then will be unaffected as well.

But we aren’t going to see a full 30% price increase on modules because prices have been mostly flat for the past six months.  That means that the normal price decreases we have grown accustomed to haven’t happened while LG, and every other manufacturer, waited to see what would happen.  In fact, it looks like our most popular module, the LG 335’s, will only increase in price by 13%.  Moreover, module costs are no longer the driving number in our solar installs, accounting for between 20 and 25% of the total system cost.  That means that a module increase of 13% translates into something like a 3-4% overall increase.  A useless waste of money to be sure - but not a game changer.

Exempt Me!

LG makes a premium product that is substantially different than the product offerings from either Suniva or SolarWorld.  For example, the LG 335’s that we have been installing lately are N-type modules, compared to the P-type modules sold by Suniva.  Beyond that, the LG 360’s that we are installing are back contact N-type modules, making them doubly more sophisticated that what the complainants offer.  These are premium products that do not directly compete with the more standard, commodity offerings that they are accused of harming.  Bottom line - people choose the LG modules that we are offering because they are a clearly superior product, albeit at a premium price.

While I’m no expert here, it is my understanding that a manufacturer can petition to be exempted from the tariffs if they can demonstrate that they do not directly compete with the complainants’ products.  LG is pressing that point, and it is possible that they will prevail in their argument and be exempted entirely from the tariff, although we won’t know that for some time.

Stay Calm - and Go Solar!

The bottom line here is that as short-sighted and ham-handed as this decision was, it will not radically change what we do and how our clients will be charged.  If you were considering going solar, there will be little economic impact to the value of going forward due to this new tariff. 

So let’s all take a breath, stay calm, and continue to do what we’ve been doing for more than a decade - helping people by putting the highest-value solar systems on their roofs, providing them with clean, affordable energy for years to come.

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12/16/13

  06:13:00 am, by Jim Jenal - Founder & CEO   , 741 words  
Categories: Solar Economics, Residential Solar, Ranting

How can love survive?

In the stage version of The Sound of Music, there is a song about the perils of romance among the affluent titled, “How Can Love Survive” – sadly it was cut for the movie. But I’ve always liked that song and I was reminded of it while reading a piece over at greentechsolar that debated the question: Will smaller solar installers survive? Lest you have any doubt where we come out in this debate, the answer is simple: heck yeah! But let’s see why…

The debate was held last week at the U.S. Solar Market Insight event in San Diego and was reported on by the always interesting Herman Trabish in a piece titled, “GTM Debate: Will Smaller Installers Survive in Tomorrow’s Solar Market?” (H/T solarwakeup.com)  The debate featured Vivint Solar’s VP Thomas Plagemann squaring off against SunPower’s Residential Solar VP/General Manager Martin DeBono.

Plagemann’s comments reflect all of the arrogance and self-importance we have come to expect from such major players:

“In this business, we have to take three essential steps,” Plagemann said. “Find and acquire customers, design and install systems, and finance the systems.”

Financing has to come first, he explained. “A typical equity finance fund of $50 million, at $2.50 per watt and 5 kilowatts per system, means 4,000 systems. Using small installers to get that scale cedes control.”

Vivint has installed home security systems nationally for twenty years and keeps that control. “We acquire customers. That’s what we do. We took that customer acquisition engine and applied it to solar. Our success in the last twelve months is the answer to this debate.”

(Emphasis added.)

We note that Vivint has mostly done its work outside of the California market, so that $2.50/Watt number is not reflective of their presence in our fair state.  Indeed, when we last looked at CSI data for the first half of 2013, Vivint did not even crack our list of the top 16 installers. Here’s that graph:

Top 16 solar installers first half of 2013But even if they aren’t (yet) big in CA, is there any doubt that you could have gotten the same response from someone at SolarCity?  Their goal is to make solar a commodity with a standard set of offerings - if your roof fits into that model (and your FICO score is high enough) - you are golden.  Just don’t look for any real care and attention to detail.

Speaking for the little guy was DeBono from SunPower (with just a little irony given the size of SunPower).  He noted that:

“Small business is the second most popular institution in the U.S., after the military,” he said. People want to buy from small businesses.” In the home building industry, 40 percent of new homes are built by large national builders, but 60 percent are built by small local builders. Solar installation will break out the same way, he said.

“Large solar installers can leverage the advantage of scale as long as everything is uniform,” he argued, “but variance is the rule in solar, and variance is anathema to scale. For customers that don’t fit into a box, local installers are the answer. Variance will cap the rise of national installers.”

DeBono went on to note that forming a partnership with SunPower provides installers with leverage and a national brand.

We agree that establishing partnerships is essential, though we might question the degree to which SunPower is a national brand in the way that matters most - consumer consciousness.  Toward that end, we believe that partnering with a company like LG Electronics - which truly is a national brand and has the ad budget to prove it - makes more sense for small installers.  But how do you get access to the other essentials of the business?

Run on Sun has been exceptionally fortunate to have partnered with Focused Energy, who is much more than a premier distributor.  They have not only been our primary supplier since we first connected a few years ago, but they have offered us support, flexibility and insight that has made them an essential part of our success.  If you run a small solar business and you haven’t connected with them yet, we would encourage you to check them out.

As we have said many times, solar has to be more than just another business.  We have to be better.  At the end of the day, that is why the small installers will survive: because we care more, and that translates into greater value for our clients.

Bonus for sticking around to the end:

02/04/13

  10:13:00 am, by Jim Jenal - Founder & CEO   , 471 words  
Categories: All About Solar Power, Solar Economics, Solar News, Commercial Solar

LG Rolls Out NeoN Modules

LG logoWe have just learned that Run on Sun’s leading module manufacturer, LG Electronics, is introducing its new NeoN line of modules. 
This is an exciting product that provides 280-290 Watts in the same footprint as their previous 250-260 Watt modules! But how will they match up with existing Enphase products? Here’s our take.

First, some product highlights:

  • Dramatically improved module efficiency - increasing from 15.5% for LG’s current, 255 Watt modules to 17.1% for the new 280’s all the way up to 17.7% for the 290’s!
  • Same footprint - the NeoN modules are the same size and weight as the current 255’s.
  • Same 60-cell module format - 280 Watt modules remain compatible with Enphase M215 micro-inverters, providing higher yields (more on this below).
  • Best in class linear power warranty (25 years) and product warranty (10 years).
  • Positive power tolerance from 0 to +3%

This is a significant product breakthrough - but one that we were anticipating from LG which is on a design path to produce a 300 Watt module before the end of the year!

But this development begs the question: how do these significantly higher wattage panels mesh with the tried and true Enphase 215 Watt microinverter?  Quite nicely, it would appear.  Enphase has released a white paper titled: Bigger is Better: Sizing Solar Modules for Microinverters that makes the case that modules as powerful as 285 Watts remain an excellent match to their existing inverter product.

Here’s the reasoning: all solar modules mounted, in a fixed position, produce power over the course of the day that resembles a bell curve, peaking at solar noon and rolling off on either side.  That means that for the majority of the time, the module is actually producing significantly less than its nameplate power.  Thus, when you tie a 280 Watt module to a 215 Watt microinverter you are actually well below the cutoff point for the inverter the vast majority of the time.  But the higher wattage means that you do a better job of filling in the gaps and increasing your annual yield.  Check out this graph:

Annual gain, M215 micro-inverter with larger modulesThe orange bars represent the improved energy yield for the higher power modules (relative to a 250 Watt module) whereas the grey areas are losses due to clipping the output of the inverter.  Even accounting for the slight loss at the 280 Watt module, you are still looking at more than 10% improvement in annual yield!  This means a lower levelized cost of energy from the array, and that means more benefit to system owners.

This data suggests that the new 280 Watt modules will be a very desirable match with the M215’s.  By the time LG releases their 300 Watt module (Summer? Fall?), Enphase should have their new product out as well (almost certainly a 240 or 250 Watt microinverter) - which should allow for similar “right sizing” gains.

We anticipate having the new LG modules in mid-to-late March - let us know if you want to get in the queue!

09/19/12

  04:03:00 pm, by Jim Jenal - Founder & CEO   , 1882 words  
Categories: All About Solar Power, Westridge PAC Project, SPI 2012

SPI 2012 Recap

We spent last week at Solar Power International in Orlando thanks to our friends at Enphase Energy - here is our recap.

Rocking with Enphase

Enphase booth at SPI 2012

As we noted in our pre-show post, we were invited to attend SPI this year at the invitation of Enphase Energy, the company behind the most successful (but certainly no longer only) micro-inverters on the market.  This was our second consecutive year at SPI courtesy of Enphase and a better host could not be found.

Last year we were part of their Installer Challenge where six installers from around the country participated in a good-natured competition to demonstrate how easy it was to install the  Enphase M215 product with its plug-in cabling.  We didn’t know it then, but very soon we would be installing more than 200 M215’s on the Westridge roof, and in doing so, earn our second invite.

Westridge project on display at the Enphase booth

Westridge Project on Display at Enphase Booth

Having achieved substantial success in the residential market, Enphase is working very hard to make in-roads in the commercial sphere - and thus our install at Westridge fit nicely into that narrative.  We participated in a panel with a group of other installation companies that have also incorporated Enphase into commercial projects and we did a pair of one-on-one interviews that showcased the Westridge project and our experience using Enphase.  We also got to speak to a fair number of visitors to the Enphase booth (which was always crowded) and we even got a sneak peak at a prototype of the next model (which we can’t comment on now, except to note that some installer-requested features will be included - stay tuned!).

It was a great way to see the show and we can’t thank Kady Cooper and everyone at Enphase enough - you folks rock!

Oh, and one other point.  Pretty much every large company at the show hired local “talent” to help host their booth.  Most companies that do that, seem to think that it makes sense to have these women wear outfits that are more akin to what you would see on a dance floor than at a solar installation. As the father of a 16-year-old daughter, it was really satisfying that the two women who were brought in by Enphase to help host their booth wore outfits just like all of the other Enphase employees.  Another example of how Enphase Energy is a class act.

Stars of the Show?

Enthusiasm Gap

As great a time as we had at the Enphase booth, we would have to say that overall, the show was a bit of a letdown, as was the show in Dallas last year.  We admit to our California bias, and we mean no disrespect to solar fans in Dallas and Orlando, but the crowds just never came anywhere near what saw filling the aisles in Los Angeles two years ago - despite a significantly worse economy in 2010.  Not clear that Chicago will be able to reverse that enthusiasm gap (and also not sure whether we will be there to find out), but we expect things to bounce back when the show moves to Las Vegas in 2014.

Trending

If there was one discernible trend at the show, it was that AC-modules - whether fully integrated or by way of the abundance of micro-inverters on display - are here to stay.  We think the reasons for that success are pretty compelling (as we have noted before) but it certainly looks like the panel and inverter makers have come around to that point of view - however grudgingly that may be.

Storage - Not Yet Ready for Prime Time

A number of companies were talking about energy storage and a presentation at the KACO booth declared that local storage was the future of solar.  That may well be, but none of the products that we saw at the show, including those from KACO and Samsung, appeared to be ready for deployment anytime soon.  Still, the prospect of potentially generous incentive dollars for such storage - assuming the CPUC can ever implement the existing law - means that this will continue to be a hot topic and one which we intend to cover in greater depth in the future.

LG Bounds Up the Learning Curve

LG 300 Watt solar panel

We wrote last year about the introduction of LG Electronics into the U.S. solar market and this year they became our “go-to” panel of choice for working with the Enphase M215 micros.  Well it is apparent that LG is paying attention to their feedback as they had a couple of significant announcements.

First, their existing panel products, notably the 255 Watt panel that we will be using for the rest of the year, is getting a frame redesign that will make the overall panel 11% lighter without sacrificing strength or durability.  Also, the panel now has clips on the back side to hold the panel leads in place so you cannot have them getting crushed by the panel frame when you stack them prior to installation.  These are relatively minor changes, but they show a great attention to the type of details that make an installer’s life easier, and even safer.

The other announcement was that of their upcoming 300 Watt, 60-cell panel that is due out next summer.  We had heard rumors that LG was about to announce such a panel, and now they have - of course, next summer is a long way off.  It will be interesting to see how this new panel meshes with the new Enphase micro-inverter which will most likely also debut sometime next year.

President Clinton Rocks the House

To be sure, the biggest hit of the conference was the speech delivered by President Bill Clinton, fresh off his tour-de-force at the DNC the week earlier.

President Clinton addresses SPI 2012

President Clinton did not disappoint, taking on the new role of Cheerleader-in-Chief.  Often touted as the smartest guy in the room, the former President displayed detailed knowledge of the solar industry and he both exhorted and chided the crowd for not getting their successes before the public.  “Most people don’t know that there are 100,000 people working in the solar industry,” Clinton reminded the audience.

“You are going to win this fight,” the President insisted, “the only question is when and how."  What was needed was for solar to reach the sort of “tipping point” which would make that ultimate success inevitable.  But we certainly aren’t there yet, which is a shame given that “the United States leads the world in its potential for solar so we must also lead the world in installed capacity - but we are not."  A lot of that is a reflection of different policies between countries that have adopted solar with gusto, like Germany, and the more tepid policy response of the U.S.

But those of us in the solar industry are in the “future business” and “you have to take risks if you are going to go to tomorrow’s dance."  We should embrace those risks because we are in such a fortunate position:

The greatest human tragedy in this country today is the crushing unemployment.  Millions of Americans wake up every day with no hope that today will be any better than yesterday.  But you are so very fortunate because you get to get up every morning, look at yourself in the mirror and say, “Today I’m going to do something great!"  You just have to keep doing it until we reach that tipping point.

Thanks for the encouragement, Mr. President, we’re working on it!

Winner of the “Oh No, You Didn’t Go There” Award
Tie: SMA & Shoals Technology

SMA

SMA, one of the leading inverter manufacturers in the world, had a tortured product “near roll-out” during SPI and in the course of same made possibly the worst ever argument in support of their product from a solar company.  Here’s how it played out.  After initially dismissing the introduction of micro-inverters as a fad that would never catch on, SMA has now had to introduce their own micro-inverter product, but they remain deeply ambivalent about the whole thing.  Nowhere was this more on display than their presentation about the “virtues” of their new product during SPI.  We attended one of these schizophrenic productions and came away not only scratching our head, but seriously annoyed.

We were fundamentally puzzled by a presenter who spent the first half of his presentation questioning why on earth (or more accurately, on the roof) anyone would ever want to install a micro-inverter in the first place.  He then abruptly shifted gears to sing the praises of his product, and then introduced perhaps the most significant non-starter concept at SPI: the hybrid PV system, which to SMA means installing both micros and a string inverter on the same project.  (Do I really want both AC and DC conduit runs coming down from the roof?  Is anyone going to do this?)

Perplexed by the whole thing, I went up after the presentation to hear what else he would say.  The conversation promptly shifted to warranties, specifically, how long would the SMA micro’s be?  Well, we were told, the product is still in testing (with UL) so he couldn’t definitively say.  “At least ten years, hopefully 15,” he said.  (Now mind you that CSI rules require at least a 10 year warranty, so we weren’t really breaking any new ground here.)  “But wait,” said one of the installers standing by, “I have to compete with the 25-year warranty that Enphase is offering.  How am I supposed to compete with that if all you offer is 10 or 15 years?"  SMA’s spokesperson responded by belittling the idea of a company that has only been in business a short time offering a 25-year warranty, calling it not credible.  “Maybe,” said the installer, “but once I submit my bid, I’m not there to make that argument to the customer.  So I’m at a disadvantage if the guy bidding against me submits a bid that offers a 25-year warranty.”

Clearly frustrated by this predictable turn in the conversation, SMA’s spokesperson decided to pull out his trump card: “Look, you wanna talk 25-year warranties, you wanna know who else had a 25-year warranty?  I’ll tell you who, Solyndra!”

Oh.. No… You… Didn’t!

At that point my head completely exploded.  As an industry we simply cannot use Solyndra to make cheap points.  We are attacked time, and time, and time again about the Solyndra situation and yet, here was SMA’s spokesperson going there with great relish. Just plain stupid - and frankly, totally unnecessary.  Come on, SMA, you are better than that.

Shoals Technology Group

But while SMA’s speaker gets the award for most inappropriate comment, far and away the worst offender at SPI was a company called Shoals Technology that used the show to kick off an ad campaign for a product they called “Nice Rack” with photos of buxom women exploding out of their bikini tops.  We alluded to this in our recap of the InterSolar conference, but obviously they did not get the hint.  And then when lots of folks started to complain, they really earned the tin star with clusters for boorish behavior beyond the pale.  You can contact their CEO, Dean Solon, by way of LinkedIn, or you can go to their contact page to let them know what you think of their sexist behavior.  This is not the way to grow this industry, guys.

Google

10/23/11

  04:57:00 pm, by Jim Jenal - Founder & CEO   , 1117 words  
Categories: Commercial Solar, SPI 2011

SPI2011 - Wrapup & Reflections

Solar Power International 2011 took place in Dallas last week and it was a very interesting show. While it is hard to reduce a three-day event to a single blog post, it is entirely fitting to provide a brief recap on what we saw, and more importantly, our take on what it all means.

Preliminary Thoughts

We have not seen any actual attendance figures for the show but to us it seemed smaller and less attended than last year in Los Angeles.  To be sure, given our other obligations we did not have as much time to walk the floor as we did last year, but the show seemed more contained than before.  Moreover, the crowds seemed significantly smaller.  Last year in LA it was not uncommon to be in a crowd of people nearly as tight as an infamous LA freeway traffic jam.  There was little or none of that in Dallas from what we could see.

Still, the show was sufficiently large that there were undoubtedly cool things that we missed so please let us know your thoughts in the comments (not so subtle hint!).

Financial Matters

The biggest change in the show this year compared to the five we had attended previously was how often people brought up financial stability (or lack thereof) as a selling point.  Now in this post-Solyndra world that no doubt makes some sense, but it was jarring to hear it brought up so frequently.  For example, one distributor touted the leanness of their operation compared to their bloated and struggling competitor.  That competitor assured me, sua sponte, that they had been recapitalized and were now stable and moreover, their production guarantees were actually provided not by them, but by a third-party financial institution.  One panel manufacturer critiqued another by saying that they were bleeding money while that competitor suggested that solar was simply the flavor of the week at the competition and that they would not have staying power in solar. 
And so on.

While we had heard financial critiques of start-ups in the past - and it is always a fair question to ask where a start-up is getting its money and whether it can generate sufficient revenues to survive - this was the first time that we had heard such critiques applied to well-established players.  It was both interesting - certainly we have not spent much time analyzing 10K’s in deciding which products and suppliers to use - and a bit distressing.  Here’s hoping that next year everyone is doing so well that the financial matters are moot.

LG Enters the Fray

LG Mono X solar panelThe most interesting development at the show this year was the introduction of Korean electronics giant, LG Electronics, into the U.S. solar panel market.  From a technology standpoint, their panels - both mono and polycrystalline - appear to land somewhere between Sanyo and Suntech. The fit and finish appeared to be very good and the specs are appealing with a 0~+3% production tolerance and a module efficiency ranging from 13.7 to 16.2%.  One of their products, the Mono X (which comes in 250, 255 and 260 Watt variations) also claims to be the first solar panel to be “Carbonfree Certified.”

More significantly, the LG panels possess something that neither Sanyo nor Suntech has: an enormous brand-presence with American consumers.  Indeed, given the success of LG in the U.S. consumer electronics marketplace in recent years, it would be surprising to find a potential client who doesn’t already have one or more LG products in their home.  “Life’s Good,” indeed.

As fellow blogger and solar tribe leader, Tor Valenza a/k/a Solar Fred, has commented more than once, branding - and more importantly, brand recognition - in the solar industry is what we are all trying to achieve but so far no one really has.  Now that LG is weighing in and in a big way, can it be long before we see that LG Super Bowl ad featuring solar panels?  (Hey, LG, feel free to go with that idea and you don’t even have to pay me!)

Innovative Non-Lease Financing

The other big development that we saw was the introduction of a clever, non-lease financing mechanism coming from one of our distributors, Focused Energy.  While leasing programs can appear attractive - we’ve all seen the “go solar with no money down” ads - they have limitations for commercial customers including forfeiting the ability to advertise that your company is solar powered.  Yet cash-flow concerns can impose a significant impediment to potential clients.  While the bulk of those early out-of-pocket costs get recouped fairly quickly thanks to the utility rebate and the federal tax credit, commercial clients must still pony-up the full freight to get the project rolling.

That is where Focused is stepping in to help out.  Their program will allow the commercial client to assign to Focused the rebate and federal tax credit (in the form of the 1603 grant) and immediately reduce that amount from their initial purchase price.  We are excited by this program and we will post in greater detail when we have had a chance to review the fine print.

A Word of Thanks

Finally, we would be entirely remiss without a word or two of thanks to our sponsor, the great folks over at Enphase Energy.  Going into the event we wrote about how our presence was being subsidized by Enphase and we have also reported on the very spirited competition in which we participated and which became the talk of the show.

As great as all that was, on a more significant level, this was a chance to have unprecedented access to the Enphase decision makers, from CEO Paul Nahi, to Product Manager Magnus Asbo, to Marketing folks like Christine Bennett and Noelani Price.  Think about it - how often does an installer get asked by the CEO and Product Manager of a product you use everyday, “What are the things you like the least about our product?"  That’s easy - hardly ever!  But we were able to provide exactly that type of feedback this past week in Dallas.  Of course, it remains to be seen whether any of our feedback ends up in their product, but it surely does feel good to be asked.

Given that imitation is the sincerest form of flattery - something Enphase already knows quite a bit about given the influx of other companies, including SMA, into the micro-inverter space - we would not be surprised to see more manufacturers inviting installers to participate with them at future shows.  We surely hope that happens as it can only be good for the industry, but Enphase has set the bar really high.

Your Thoughts

So those are our thoughts; if you were at the show we would love to hear about your insights and observations in the comments.

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Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
Run on Sun also offers solar consulting services, working with consumers, utilities, and municipalities to help them make solar power affordable and reliable.

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