SolarCity (SCTY)

[jhm]

The same analogy can be made to say that McDonalds has enormous potential to deliver all food to all Americans who are hungry. It's a stretch to link one particular company to the entirety of the need of the population. Especially when economics and supply/demand/competition are involved.

I think the more apt analogy would be that restaurants can serve half the food consumed. It's not that SolarCity can realize a market share of half the US electricity consumed, but that all rooftop solar has that potential. The critical issue here is that the protected niche of traditional utilities is shrinking. The utilities are safe from rooftop competion for about 60% of the market with solar at 15% efficiency. But this shrinks to only 20% safe with solar at 30% efficiency. In 20 to 30 years, 30% efficiency may be a possibility. This combined with batteries and other forms of distributed generation suggests that utilities may simply not be needed in 30 years. They will have to compete on service and price for any market share they are to retain. Remember that the retail cost of transmission and distribution is about 7c/kWh. As solar and batteries approach that price in the coming decades, the competitive landscape will change enormously. Electric utilities could go the way of landline telephones.

 

[SBenson]

Given that this is not reported here

Outten & Golden LLP: SolarCity Corp. Accused of Failing to Pay Overtime to Installers

 

[ggies07]

Saw and talked to a guy who works for and was wearing a SolarCity shirt today in line at the Dallas gallery. This was great exposure for the company.

 

[renim]

I think the more apt analogy would be that restaurants can serve half the food consumed. It's not that SolarCity can realize a market share of half the US electricity consumed, but that all rooftop solar has that potential. The critical issue here is that the protected niche of traditional utilities is shrinking. The utilities are safe from rooftop competion for about 60% of the market with solar at 15% efficiency. But this shrinks to only 20% safe with solar at 30% efficiency. In 20 to 30 years, 30% efficiency may be a possibility. This combined with batteries and other forms of distributed generation suggests that utilities may simply not be needed in 30 years. They will have to compete on service and price for any market share they are to retain. Remember that the retail cost of transmission and distribution is about 7c/kWh. As solar and batteries approach that price in the coming decades, the competitive landscape will change enormously. Electric utilities could go the way of landline telephones.

Here I gotta disagree with you, even with 100% net generation with distributed solar the need to operate the transmission and distribution is minimally impacted, and the need for coincident peak power generation still exists (but moved and reduced) and the need for a billing and customer 'service' entity is unchanged.

in my country SA is approaching 100% daytime energy from renewable (mostly solar) at around 2023 Rooftop solar to cut total grid demand to zero in South Australia but they will still need those powerlines

in my country Tasmania exported too much zero emission energy due to the carbon tax and is now rushing to run on diesel because their dams are too low. Labor, Greens call for Senate inquiry into energy crisis

the cost of customer 'service' transmission and distribution is high and generally fixed, going 100% net solar does does materially impact those costs. cutting the line to the grid eliminates those costs.

 

[doggusfluffy]

American Electric Power, FirstEnergy Get Ohio Approval to Shift Some Cost Burdens to Customers

The Public Utilities Commission of Ohio voted unanimously to approve plans to have consumers pay extra to keep the plants running, over objections from rival power-plant owners and consumer groups, who said the moves would raise utility bills and hurt competition.

“The electricity industry as a whole is in a period of transition,” commission chairman Andre Porter said. “Ohioans should not be alarmed by the transition.”

 

[jhm]

Here I gotta disagree with you, even with 100% net generation with distributed solar the need to operate the transmission and distribution is minimally impacted, and the need for coincident peak power generation still exists (but moved and reduced) and the need for a billing and customer 'service' entity is unchanged.

in my country SA is approaching 100% daytime energy from renewable (mostly solar) at around 2023 Rooftop solar to cut total grid demand to zero in South Australia but they will still need those powerlines

in my country Tasmania exported too much zero emission energy due to the carbon tax and is now rushing to run on diesel because their dams are too low. Labor, Greens call for Senate inquiry into energy crisis

the cost of customer 'service' transmission and distribution is high and generally fixed, going 100% net solar does does materially impact those costs. cutting the line to the grid eliminates those costs.

I'm talking about the economic opportunity decades out when batteries are cheap and abundant. At the present moment, Australia is in sore need for batteries. IIRC, Tasmania lost its transmission to the mainland and is in a crisis situation. These situations will radically change as storage is added to the mix.

 

[neroden]

I expect that grids will be retained; they're far too useful in cities.

However, it's already uneconomic for extreme rural areas to be on the grid. Think of the options:
(1) Lots of batteries and solar panels. There's plenty of space for them, the land is cheap....
(2) Big copper distribution wires running for hundreds of miles just to reach you. Poles. Guys maintaining the poles and wires. Trimming trees. Etc. For a few guys living in the middle of nowhere. They're highly subsidized right now.

I expect the rural areas to go off the grid fast. A few utilities in Australia have *already figured this out* and are paying the remote rural customers to install batteries so they can take them off the grid.

Now, here's the thing: with the rural areas removed from the grid, *the cost to operate and maintain the grid drops*. It may become quite competitive to maintain it in the big cities.

 

[bonaire]

We need distributed batteries - such as 500 kWh units sitting at the head of a cul-de-sac. Times thousands. Fill them up at night using base-load plants, top them off during the day if the homes have solar on them. Net-meter excess back to the attached grid. Perhaps allow homes to back-feed into the batteries should a grid-down event happen. A cul-de-sac of 100 homes, with 20-30 of them housing solar, could aggregately recharge a 500kWh block of batteries if they provide grid-up signaling and re-charge limiters should voltage hit max. I don't think it is nearly as efficient to install batteries in each and every home. Community battery is where it will be at down the road.

Same for a business building that has high demand (steel mill, for instance). I was just at a steel mill in Iowa recently and their powerline connection is enormous and it's a small mill. They only need the full power primarily when starting up the furnaces. The rest of the time, their demand is limited. I don't think steel mills will use batteries - but their furnaces burning during peak daytime load events along with high levels of AC and other business functions is where some of the problems lie.

When I shopped for my Solar PV array in 2009-2012 (installed Dec. 2012) -- Installers were telling me we had to reduce need for peaker plants. Those plants actually are rarely used. Baseload plants have moved from coal to Nat Gas during this time and their efficiency in both labor (cost to run) and fuel (NG is cheap now) makes them more interesting as a near-term power supply. But NG is only 25% less CO2 output than a coal plant for each MWh produced. Carnegie Mellon says NG produces 600 kg of CO2 per MWh while coal 800 kg.

What we also see - with the recent Tesla Model 3 reveal - is that 100,000's of new EVs will be recharging at night (primarily). Solar PV alone isn't going to be a solution there - wind farms are. Wind in Texas at night allows some people to pay negative rates on night-time power demand. We need to see more homeowners considering local wind power in the Dakotas and other wind-zones. Wind is just as viable of a product to offer customers.

I am actually surprised that Solar City isn't in the homestead wind installation business. It is just as lucrative as the now lower-margin Solar array business.

 

[TheTalkingMule]

Nearly 600k shares in the first 12 minutes of trading. Not too shabby.

 

[bonaire]

I expect that grids will be retained; they're far too useful in cities.

However, it's already uneconomic for extreme rural areas to be on the grid. Think of the options:
(1) Lots of batteries and solar panels. There's plenty of space for them, the land is cheap....
(2) Big copper distribution wires running for hundreds of miles just to reach you. Poles. Guys maintaining the poles and wires. Trimming trees. Etc. For a few guys living in the middle of nowhere. They're highly subsidized right now.

Almost all power delivery is done using aluminum wires. And we know the price of aluminum is down well from it's highs. (so is copper too). I live near a whole bunch of people who are not on the grid. They do fine. They're called The Amish. A few use a small wind turbine to recharge batteries. A few have a couple solar panels to recharge batteries. The main problem is the enormous power needs of the "modern electrical family". 2500 sq ft homes using up to 2000 or more kWh per month. Inground pools dot the landscape. Pumped and kept warm for the few times we use them. The problem is if we lived smaller and lighter - we could actually live in self-contained, off-grid homes. Why not have a community pool rather than everyone having their own?

The power grid is the largest, most well maintained and most reliable "machine" on the planet. I just don't see all the negativity of the grid. One day it is "coal is bad", the next is "grid maintenance is expensive". But when you make everyone's home its own power station, you end up with so many points of failure that need annual maintenance, 1-2% annual production decrease due to loss of efficiency of solar PV modules and battery degradation. The issue is "just who is right?" It is some combination of all things. To make every home self-contained, off-grid - the cost is easily 4-5 times that of the grid itself. Even with sub-$100/kwh batteries. The batteries need to be replaced every 10-15 years after 3600 cycles if they use more than 75% of the state of charge (I'm talking Li-Ion still, not LA). If I was building a rural home today, I would first make it very energy efficient. I would take into account all conservation measures possible (ie. no inground pool for one). I would put up enough Solar PV to account for double my EV miles expected. And then I probably would still want to be connected to the grid because the kWh costs are still quite cheap versus the alternatives. Now, if I was living in a rural place in India or Africa where power outages are daily - sure, off-grid I would go. Just like many middle-class and upward homes in India have backup battery systems now.

I really think community and campus battery systems would be a good thing. If me and my neighbors could share a battery system and even tie-back solar pv production into recharging those batteries and the batteries were grid-regulated to act as a "little mini peaker plant" then I think we will be getting somewhere. In America, we really don't like sharing because we fear "someone else may get the better of me in the deal". But if the grid providers could offer cost of scale deployment of batteries in a sensible manner that also allows for battery-backup should a grid failure occur - then it's far more equitable.

 

[doggusfluffy]

I could only find this blurb in the free Politico Morning Energy section. Isn't the Senate Energy omnibus supposed to start up again this week?

EPSA TO OHIO: WE’RE GONNA BRING THE PAIN: A group of power generators is incredibly ticked off at Ohio regulators for approving two plans Thursday that lock in above-market electricity prices for a handful of power plants run by AEP and FirstEnergy. “Bottom lines,” Electric Power Supply Association chief John Shelk wrote in an email, “this is far from over, we and the diverse coalition of which we are a part here in DC and in Ohio has not yet begun to fight ... and in the end we intend to prevail and stop these abusive [power purchase agreement] bailouts.” The five-member Public Utilities Commission of Ohio board unanimously approved the controversial agreements, throwing a lifeline to coal plants and the Davis-Besse nuclear reactor for eight years. “PUCO has locked the consumers of Ohio into one of the largest handouts in the history of public utility regulation,” Glen Thomas, who heads the PJM Power Providers Group, which includes Exelon and NextEra, said in a statement. EPSA and environmental groups are planning to press their opposition through FERC as well as the federal courts.

 

[bonaire]

PJM's market management is what should make for a fair market. Locking in old plants at higher than market rates isn't really fair in such conditions. Let the market decide what power prices should be. The end result with higher generation prices - higher end-user customer prices. It hurts more to help the few.

 

[TheTalkingMule]

Someone needs to be the adult and decide where the cutoff will be for new plant construction. I'm perfectly willing to give these utilities some slack since they've put so much money into plants that the market asked them to build. However, if I lived in Nevada should I not be livid that I am going to end up paying for this new NV Energy peaker plant that will be obsolete on day 1?

Someone needs to come up with the rules for transition. I'd say Congress, but that is an utterly laughable concept. Hopefully DoE is working on the rules that will bring a bit more order.

 

[neroden]

bonaire:
In Australia a remote community just had its grid connection destroyed in a wildfire. The utility decided it was cheaper to buy a bunch of batteries and solar panels and build them a "microgrid" than to restore the power lines.

This is what I'm talking about. The big electric grid is more suited to suburban and urban density. The rural one-house-per-mile (or less) areas are a huge drain on grid maintenance costs and are heavily subsidized. There's a reason the US had urban electrification in the 19th century, but didn't have rural electrification until it was subsidized by FDR as part of the New Deal.

But these same rural areas also have gobs of space to put the solar panels and batteries, and enough space to locate the solar panels optimally. Often they have enough space for windmills, too.

I think the remote rural areas will be taken off the grid, because it's cheaper for them to be off-grid. And I think that will bring the grid "distribution and transmission" costs *down* for the rest of us, making the grid a better deal.

All this has nothing to do with the utilities with antiquated business models who are trying to subsidize obsolete fossil fuel plants, who are just trying to get away with something. I live in NY where we already separated generation from distribution, successfully, and our utility is behaving itself.

 

[bonaire]

neroden - up in Rochester NY, some startups are working on trying to find the next gen Li-S batteries and other advances. The goal is double today's density (double what Tesla cars have on a per-kg basis). I also think Li-S negates the venting with flame issue. Both positives. Give us 3000-cycle Li-S batteries at double today's density and then we'll see things take-off for grid-operators and for EVs. What we really need are ways to hybridize the trucking industry. We can do electric local delivery trucks (FedEx, UPS) but we have a hard time with the big-rigs.

Land ownership. In the outback of Australia, it may be easy to install a MW or many MW of solar and wind in one spot to take a town offgrid. But in the USA where land ownership is a costly thing, you almost have to subcontract with farmers to install something to serve a small region with some of their land. Right now, the USA has tons of subcontracted "land" where a cell tower is installed on private property and the owner gets paid for that service. Will power companies offer land owners such a scenario? It would seem wind turbines and batteries would work out better for farmers than solar arrays and batteries. You can still farm the land under and near a wind turbine. Once the 1MW takes up the 4-5 acres, it's hard to use the land effectively.

But before we get too crazy with renewables, I would like to see Thorium reactors be attempted for viability and even deployed. There is hope that thorium nuclear reactors would be a great solution to older heavy-water nuclear plants. Great for base load and very green. Nuclear is quite green. Only problem is the radiation.

Thorium Power Is the Safer Future of Nuclear Energy

My room mate in college was from Ithaca. Nice town. Back in the day, I remember bike racing around Cayuga lake.

 

[doggusfluffy]

Maui Now: HECO Proposes Modernizing Plan for Hawai‘i’s Grids

Under HECO’s proposal, similar to the program implemented by the Kaua‘i Island Utility Cooperative and other utilities across the country, residential customers who choose not to have a smart meter installed would pay a monthly charge of about $15 to help pay for the cost of continued manual reading and maintenance of their non-standard meters.

 

[TheTalkingMule]

SunEdison "preparing to file for bankruptcy". Maybe a nice SCTY buying opportunity coming up?

I know they're nowhere near the same model, you know they're nowhere near the same model, but this MUST have some downward effect considering it doesn't seem to take much these days.

 

[Lessmog]

SunEdison "preparing to file for bankruptcy". Maybe a nice SCTY buying opportunity coming up?

I know they're nowhere near the same model, you know they're nowhere near the same model, but this MUST have some downward effect considering it doesn't seem to take much these days.

So, timing can be critical. Will I have time to take a little profit on TSLA to put into SCTY before the solar price contagion sets in? That might be nice, in re-diversifying a little.

 

[dakh]

So, timing can be critical. Will I have time to take a little profit on TSLA to put into SCTY before the solar price contagion sets in? That might be nice, in re-diversifying a little.

Same thoughts I had for a while now, that would be the best case scenario. I don't expect much good from next SCTY ER so that could provide another opportunity.

 

[hirox]

the tweet is a year old