Watching SunEdison’s Collapse, Solar Industry Resets

[OKIsItJustMe]

https://www.technologyreview.com/s/601217/watching-sunedisons-collapse-solar-industry-resets/

[font face=Serif][font size=5]Watching SunEdison’s Collapse, Solar Industry Resets[/font]

[font size=4]SunEdison’s collapse and mounting losses elsewhere are causing solar developers to change course.[/font]

by Richard Martin April 11, 2016

[font size=3]Saddled with more than $11 billion in debt and facing at least one investigation by federal officials plus a lawsuit from its own subsidiary, solar giant SunEdison is lurching toward bankruptcy. The shares of other leading solar providers, including SolarCity and Sunrun, have lost more than half their value in the last four months as investors lose confidence in the no-money-down, 20-year-lease model that has fueled the explosive growth of the rooftop solar market in the last few years. Even though Congress has extended the investment tax credit, which provides credits worth 30 percent of the value of installations, that growth is expected to slow as the developers focus on improving their balance sheets rather than fueling breakneck expansion (see “Tax Credit Extension Gives Solar Industry a New Boom”).

“The market landscape is changing,” says Lyndon Rive, SolarCity’s CEO. Supported by government subsidies and financing from big banks, solar companies for years have been able to dramatically increase installations year by year, even while losing money. But the collapse of SunEdison made clear the perils of too-rapid growth.

SolarCity installed 870 megawatts of solar projects in 2015, 73 percent more than in 2014, and its revenue climbed to nearly $400 million, 56.7 percent above 2014. But the company continues to lose money: nearly $769 million for the year, more than doubling its 2014 losses. Similarly, Sunrun lost $28.2 million in 2015 even as revenue climbed 53 percent. There is little evidence that the major solar developers will become profitable this year or next.

So even at a time when demand and revenue continue to rise, the efficiency of the technology continues to improve, and installation costs are going down, rooftop solar is facing a major retrenchment. The reset is causing executives to rethink their business strategies and outsiders to ask: how can rooftop solar photovoltaics be turned into a viable, profitable business?

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[msongs]

1. here's how rooftop solar can be a "viable profitable business" - create and install systems on roofs

for a fee plus costs then go away. only come back to maintain and upgrade systems. then go away. no need to strangle the customer base or corner the market. voila, profit plus service to the nation.