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Have to respectfully disagree. When the recording comes out, we'll have to confirm.
I have no idea why the stock is dropping. I thought the conference call was great news for SCTY. I put in a bid for some 50 dollar call Jan/17. ...see what happens. They lost around 20% of value today...and I figure that should pop back relatively quick..at least in next 6 months.
According to SA it is because of SUNE results -
SCTY, SPWR, CSIQ, others hit hard following SunEdison's earnings - SolarCity Corp. (NASDAQ:SCTY) | Seeking Alpha
The entire market is on the technical skids right now. Solarcity is fundamentally stronger then it ever has been, so complete non sense and buy time for as per usual on opportune occasions for me. I'm willing to bet this is short covering volume for Solarcity's short interest was around 40%. Bet you we see short interest decline in coming reports.
Power Struggle | Cover Story | Salt Lake City Weekly
the best thing about this article on net metering was the single comment posted:
"Great article. It could have pointed out more clearly, however, that the gap between RMP and Borenstein and the PSC, on the one hand, and the full value of solar, on the other, is a whole lot more than the so-called "externalities." Failing to do this makes it seem like it is a debate that it is not. The studies in other states find value in avoided transmission and distribution energy and capacity (Borenstein incorrectly waves this off by confusing sunk and fixed costs), demand reduction-induced price effect, reduced fuel price volatility risk (which the utility always passes to customers), immunity from drought and ability to generate without water, reduced risk of environmental regulation, and more accurately calculated generation capacity value. The piece did not address the benefit of customers investing their own money (instead of socialized investment cost and profit by the utility), private assumption of operating and insurance risk, and ancillary service benefits that increasingly smart inverters offer. These and other benefits, including local jobs and tax base benefits, system reliability and resiliency improvements, clean air, and a commitment to the future all make up the value of solar. All deserved discussion in this piece. Solar systems can be reliably counted upon to keep on delivering these benefits for at least the 25 years that the cells are warranted - with no rate increase, ever. With a fuller discussion, readers can be counted to discern the real motives of the utility monopolists and their supporters. Simply put, climate changes damages, real as they are, represent only a part of the value of solar the utility wants to appropriate to itself, with the help of the PSC."
It is beyond apparent the utilities are fighting a losing battle here. Every time they say customers will see higher electricity bills, they are threatening to punish anyone that goes solar. This is against the law of the United States of Amercia. This is to the letter and actual "t" of our country's federal anti trust laws. It is plain and simple. The comment posted above clearly shows the truth about roof top solar true value to the grid and must be compensated as such. You may run for awhile buffet and Koch, but You can't hide from the facts.
clean air is an interstate issue. It is not a state issue. The pollution fossil fuel plants emit cross state lines. There is no box that keeps the co2 and pollution only in Oklahoma or Texas or West Virginia. It spreads everywhere. All those states that are suing the clean air act on state rights are flat out 100% going to lose and their residents will suffer for it when federal funds dry up as a result. You want to see your tax base flee to other states as fast as humanly possible? Continue on with those ridiculous lawsuits...
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Power Struggle | Cover Story | Salt Lake City Weekly
the best thing about this article on net metering was the single comment posted:
"Great article. It could have pointed out more clearly, however, that the gap between RMP and Borenstein and the PSC, on the one hand, and the full value of solar, on the other, is a whole lot more than the so-called "externalities." Failing to do this makes it seem like it is a debate that it is not. The studies in other states find value in avoided transmission and distribution energy and capacity (Borenstein incorrectly waves this off by confusing sunk and fixed costs), demand reduction-induced price effect, reduced fuel price volatility risk (which the utility always passes to customers), immunity from drought and ability to generate without water, reduced risk of environmental regulation, and more accurately calculated generation capacity value. The piece did not address the benefit of customers investing their own money (instead of socialized investment cost and profit by the utility), private assumption of operating and insurance risk, and ancillary service benefits that increasingly smart inverters offer. These and other benefits, including local jobs and tax base benefits, system reliability and resiliency improvements, clean air, and a commitment to the future all make up the value of solar. All deserved discussion in this piece. Solar systems can be reliably counted upon to keep on delivering these benefits for at least the 25 years that the cells are warranted - with no rate increase, ever. With a fuller discussion, readers can be counted to discern the real motives of the utility monopolists and their supporters. Simply put, climate changes damages, real as they are, represent only a part of the value of solar the utility wants to appropriate to itself, with the help of the PSC."
It is beyond apparent the utilities are fighting a losing battle here. Every time they say customers will see higher electricity bills, they are threatening to punish anyone that goes solar. This is against the law of the United States of Amercia. This is to the letter and actual "t" of our country's federal anti trust laws. It is plain and simple. The comment posted above clearly shows the truth about roof top solar true value to the grid and must be compensated as such. You may run for awhile buffet and Koch, but You can't hide from the facts.
clean air is an interstate issue. It is not a state issue. The pollution fossil fuel plants emit cross state lines. There is no box that keeps the co2 and pollution only in Oklahoma or Texas or West Virginia. It spreads everywhere. All those states that are suing the clean air act on state rights are flat out 100% going to lose and their residents will suffer for it when federal funds dry up as a result. You want to see your tax base flee to other states as fast as humanly possible? Continue on with those ridiculous lawsuits...
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jhm
Well-Known Member
Wow, SunEdison is down 26% today following a substantial earnings miss. SunEdison aspires to be a "supermajor" in the utility space. Acquiring Vivint is a small move into distributed power for them. I wonder if investors may be confused by this turn in strategy. Some investors want to invest in the utility space, while others are more comfortable with distributed energy. If may be hard to mix the two.
Yesterday I sold my position in FirstSolar. They had an earnings beat that drove share prices up 17%. I saw that as a nice point to take my profit and get out of a utility solar player.
I continue to anticipate that the power generation business within the utility space will collapse, and utility solar will be taken down with it. The politics will intensify as we get closer to the breaking point, but the clock is ticking.
Yesterday I sold my position in FirstSolar. They had an earnings beat that drove share prices up 17%. I saw that as a nice point to take my profit and get out of a utility solar player.
I continue to anticipate that the power generation business within the utility space will collapse, and utility solar will be taken down with it. The politics will intensify as we get closer to the breaking point, but the clock is ticking.
Breaking.... New Solarcity market added: Vermont.
now 19 states and counting.
Vermont solar company pounces on error by national rival - VTDigger
now 19 states and counting.
Vermont solar company pounces on error by national rival - VTDigger
SwedishAdvocate
Active Member
jhm
Well-Known Member
Sure, this is something I write quite a bit on around hear. My thesis is a power generation capacity glut. There are three elements to this: battery storage, renewable energy, and distributed energy.
As Musk recently noted, the introduction of cheap battery storage has the potential to make half of the world's power generation capacity obsolete, and this is without consideration of incremental renewable energy. Why is this? The world has about 6 TW of generation capacity mostly fossil fuels, nuclear and hydro. These assets generate about 60 TWh per day and about 54 TWh are consumed each day. Thus the average generator is utilized just 10 hours per day and about 1 hour of output is lost in transmission and distribution. Much of this capacity is used infrequently to provide peak power and to stabilize the grid. With sufficient, cheap battery storage, the most efficient half of generation assets could be utilize 20 or more hours per day m, while batteries handle peaks and valleys of demand. Peaking plants are no longer required, and if storage is cheap enough, they are no longer economical for use. Gas peaking plants have a levelized cost in range of 18 to 23 c/ kWh. Tesla Powerpacks have the potential to bring levelized storage cost into range of 5 to 8 c/kWh. Coupled with baseload or renewable energy below 8 c/kWh, this leads to fully dispatchable power below the cost of gas peaking plants.
Battery storage is considered the missing link for intermittent renewable energy such as wind and solar. These sources have two key economic advantages. They are technologies with the potential to continue decent in price. The price per Watt has declined about 15% per year for about 40 years. Now the cheapest installed levelized cost is 3.9 c/kWh, and this beats the cheapest fossil fuel generation combined cycle natural gas which has levelized cost starting at 6.1 c/kWh. So utility solar has truly become cost competive with natural gas, coal and nuclear. Moreover all solar energy has the potential to continue to decline in price. Price competive solar has efficiency below 20%, but 24% efficiency panel are quickly approaching parity at the panel level. Efficiency can double with advancing technology getting more watts per area and virtually all installation costs, while manufacturing efficiencies continue to drive down costs.Thus, solar could continue to drop below 3 or 2 c/kWh with time. Wind likewise declines in price year over year, but not as quickly as solar. Wind has achieved levelized costs as low as 2.5 c/kWh. Wind reached price parity with thermal energy years before solar so it has a lead in deployment. However, solar is likely to become even cheaper than wind and is much more widely deployable. Hence, solar may ultimately become the dominant source of energy world wide.
The second economic advantage of wind, solar and other renewables is that they have no cost of fuel. Thus, there operational cost is quite near zero. In a competive electricity market, producers bid to produce power at the lowest price. Wind and solar can bid down to zero, while thermal generators generally cannot afford to bid below their cost of fuel. However, it is costly for some generators to ramp down production or bring it back online. Thus, if too much power is supplied to the grid, such a generator may be forced to bid negative prices, actually paying other parties to shut down or accept surplus load. So this is one of the problems with to much solar and wind competing with traditional generators. The simple solution is to introduce more storage into the grid. With sufficient cheap battery storage, their is no problem with over supply. The storage operator will gladly buy load when cheap due to oversupply and use or sell power back at times of peak load. This is what destroys the economics of peaking supply. Batteries enforce a simple arbitrage limit on daily fluctuations in market prices. Specifically, the spread in peak to trough prices will be bound by the marginal cost of storage. So let's suppose battery storage levelized cost has come down to 10 c/kwh and there is plenty of it, then the difference between the highest daily price and lowest is bound by 10 c. So what if their is sufficient solar in the grid and on rooftops that the daily low is about 2 c/kWh? Batteries can provide peak power at 12 c/kWh, which reduces the utilization of all fossil peaking plants and may well price them out of the market.
So we see that batteries and renewables work in tandem. Renewable drive down spot prices at various times of the day, while batteries reduce the variability of prices throughout the day. These two functions put economic pressure on all traditional power generation. Peak power gets priced out, but also baseload loses utilization. You might wonder if intermittent renewables can drive spot prices down to zero, what is there to support prices at all? Well, storage arbitrage also solves that problem. With sufficient storage, the peak price of power minus the cost of storage is a lower bound for spot prices. So with high penetration of solar and wind we can see the market become destabilize, where low prices may go too low, even negative, and more peaking capacity may be needed to stabilized the grid while storage is not available. But as storage is added to the system, the peaks are brought down and the valleys are raised up. Now the combination of solar, wind and batteries can generate power below cost of traditional baseload and make it fully dispatchable, more responsive than peaking power. And over time the cost of wind, solar and batteries will continue to decline. This leave very little leftover demand for traditional power generation. There are still issues around seasonal variation in power supply and demand and issues around emergency back up for extreme events.
Locationization is another critical them. As generation and storage are located closer to use, there become less need for heavy grid infrastructure. The economics of maintaining the grid change. Moreover, power stored and generated locally reduces the need for centralized power generation.
So all these elements come together to undermine the basic economics that built the grid and utility generation in the first place. The issue is not really whether wind, solar and batteries are all we really need in the long run. In the long run we'll figure that out. What is really pressing is how little of traditional generation do we need in the the next ten year. In the last five years the coal industry has lost 75% of its market cap. The US has retired 190 coal plants in the last three years. But natural gas lost 75% of it price in this time too, while wind and solar have grown exponentially. Batteries alone could knock out the economics for half the existing genetaion fleet in two decades, but coupled with solar doubling every couple of years and wind continuing massive growth, the fleet may not have a couple of decades. Let's suppose half of traditional power plants become economically uncompetitive ten years or so. This leads to a massive glut of capacity. This glut undermines the price of power for all producers. The utilities will resist writing down asset, but their effort to do cost recovery from ratepayers will be met with ratepayers defecting to acquire their own cheaper sources of energy, storage and power management. The treat of load defection undermines the whole economic model of the utilities. Legal protection for utility monopolies will lose popular and political support. As politics turns against the utilities, they will have to face the economics. My basic recommendation to the utilities is to get out of the power generation business, become a service provider facilitating the free market exchange of energy and embrace the economics of distributed power generation and storage. Done right the national average retail rate of 12 c/kWh could be cut in half within a decade. Slowing this transition down to avoid asset write-downs will only make the outcome worse for utilities. They risk ruining their credit rating and crippling their ability to raise the capital needed to survive this transition. But few will embrace this opportunity, and they waste time on petty politics when they should be restructuring their business. Players like SolarCity will prey upon utilities most resistant to competing on economics and innovation. This is why SolarCity is able to double year after year. The more cost utilities try to recover on a glut of overvalued generation assets, the more they drive customers into the arms of SolarCity. Essentially the glut has begun, but rather than acknowledging it and dealing with it, the utilities are blaming rooftop solar for their problems. They should stop asking themselves how can we stop distributed energy and start asking how can we create more value with distruted energy.
On the topic of retiring power plants it's all but a given. Anecdotally I know people who have worked on updating the boilers for coal/gas plants. Many of the coal were retired or switched to gas, but only to make it another 20-30 years. These were plants in states that will receive solar PV last ie Montana, Nebraska, South Dakota, etc. there's no longer enough work to keep them employed as of 2 years ago.
On a related note, http://now.solarcity.com seems like a strong indicator that they already have some storage affecting the numbers. The site is without a doubt accurate, but the GWh is probably not the total aggregate. You can access the page from multiple regions. Everything but the total GWh for the day is in sync. I suspect they are reporting numbers based on regional micro grids.
On a related note, http://now.solarcity.com seems like a strong indicator that they already have some storage affecting the numbers. The site is without a doubt accurate, but the GWh is probably not the total aggregate. You can access the page from multiple regions. Everything but the total GWh for the day is in sync. I suspect they are reporting numbers based on regional micro grids.
everman
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