SolarCity (SCTY)

[gavine]

Excellent interview, debate, Q&A with Lydon Rive and President of PG&E:

"The Impact of Policy and Market Forces on Renewable Energy: SIEPR Summit 2016"

 

[TheTalkingMule]

I just sat down and read the entire SolarCity annual report, all 200-some pages of it.

You have to look at the SCTY value proposition and work backwards.

If their competitive advantage is based on the ability to create a convoluted financing scheme that removes all the hassle and up-front money from the process of "going solar", would they want to hand the blueprint to SUNE? It's 2016, folks like SBenson and institutional investors can take the data available and create their own simplified model that loosely represents the inputs/outputs of the SCTY model to gauge approximate profitability. We know install costs, we know the amounts "financed", we can back out installs from total expense and see how much debt is being built up to expand.

But that's not even the most important part of their product, anyone can finance and banks are now working with local installers to provide a million different near-zero-down products for purchases. What SCTY provides is truly full service solar at a price that's lower than what your utility charges. As we move through this transition period people are going to need a full service energy provider to guide them through the various stages. We are making our won power now, a third party having your back with things like storage solutions will be a vital for keeping costs down.

As for cheaper grid prices.....Utilities are quietly divesting from production in the US just like they did in Germany once distributed solar gained any traction, there is simply no money in fossil production once distributed solar is in place. Does that sound like a scenario where grid rates will ever go down? Once an open market is created a few years down the line, solar homeowners will likely see some insanely cheap juice on offer from the new grid, but with transmission charges that's unlikely to be a compelling purchase options. Especially since they'll have all the juice they want at the very same time.

SCTY can and will be able to charge a massive premium to local installers because they provide considerably more value than simply installed solar panels(Keeping in mind that SCTY installs at a loss in newer markets like southeast PA). With the trajectory of installation costs and the rapid spread of solar knowledge throughout the customer base, this will all shake out in a matter of a few quarters. The PPA model will either remain compelling or will be trimmed by super low cost installs, that's for the individual investor to decide. I see the market as 50/50 PPA/purchase today and in the future. As things gets more complex over the next couple years, it may even shift more toward full service PPA.

 

[TheTalkingMule]

Excellent interview, debate, Q&A with Lydon Rive and President of PG&E:

These things are being explained in a way that only makes sense to people who would read a Tesla Motors Club SCTY Investors Thread every day. That's not helping.

Take a listen at 57:30 when Lyndon gives his 2 cents about the logic of grids requiring access to distributed storage. He gets his point out, but not in a way that any normal person could easily absorb. Not to mention he positions the role of a homeowner's battery pack as a tool of the utility rather than something they "rent out" to the utility. No emphasis whatsoever on the benefit to the customer, just the system. How does he not see that the average potential customer will find that positioning completely unpalatable?

I know he's the CEO and head architect, but engineers with his type of brain have no place in these conversations. They should be building things, not marketing or explaining these them to the average consumer.

 

[Vitold]

Excellent interview, debate, Q&A with Lydon Rive and President of PG&E:

"The Impact of Policy and Market Forces on Renewable Energy: SIEPR Summit 2016"

Pat Hogan from PG&E is a smooth talker, she is doing good job on avoiding any direct confrontation.

These things are being explained in a way that only makes sense to people who would read a Tesla Motors Club SCTY Investors Thread every day. That's not helping.

Take a listen at 57:30 when Lyndon gives his 2 cents about the logic of grids requiring access to distributed storage. He gets his point out, but not in a way that any normal person could easily absorb. Not to mention he positions the role of a homeowner's battery pack as a tool of the utility rather than something they "rent out" to the utility. No emphasis whatsoever on the benefit to the customer, just the system. How does he not see that the average potential customer will find that positioning completely unpalatable?

I know he's the CEO and head architect, but engineers with his type of brain have no place in these conversations. They should be building things, not marketing or explaining these them to the average consumer.

I agree, he needs to figure out what his message is and drive it especially when ignored (as Pat is skillfully doing).

 

[TheTalkingMule]

HUGE volume today @ 7M and down 9%. Has the earnings call info leaked?

 

[TheTalkingMule]

Ah, it's Chanos. LOL!

Amazing that people still listen to this guy.

Chanos Still Short SolarCity, Sees `Financial Trouble' in 2016

 

[Noble Ninja]

The circuit breaker should have just tripped. I can't see any good reason for this drop besides perhaps the MM wanting the stock where it was before the last earnings call, this quarter. It either rips above $35, or re-tests $18. This is basically the mid point.

Right, isn't it supposed to trip at 10% drop? Fail.

We're down ~ 10% two days in a row. Where's the circuit breaker? In the past one week, we've lost ~ 30% of the share value with no negative news, just overall market being down in May so far.

 

[dandurston]

To buy now or after the ER is the hardest short term question at this point.

 

[drinkerofkoolaid]

The drop today was due entirely to Chanos, and broad market weakness. Once the stock broke below an important technical level, the rest of the drop was probably algo selling, and stop losses being triggered.

 

[drinkerofkoolaid]

4:30pm EST today Lyndon Rive, and Nancy Pfund spoke at the World Energy Innovation Forum at the Tesla Factory.

World Energy Innovation Forum

Additionally, this was announced a few hours ago.

RESAAS Services Inc. (via Public) / SolarCity Joins the RESAAS Marketplace

 

[Jack6591]

SolarCity Launches Utility and Grid Services

SolarCity now begins to offer the complete package of energy solutions.

 

[tanner]

SolarCity Launches Utility and Grid Services

SolarCity now begins to offer the complete package of energy solutions.

How is the SP not going up because of this?! Bought some near open and now banging head against well because it keeps going down.... Seems like last 5 trading days where it'll just keep slipping *sighs

 

[TheTalkingMule]

Anything below $50 is a bargain, just pick your spots.

 

[tanner]

Anything below $50 is a bargain, just pick your spots.

ER should have a positive effect, right?

 

[ggies07]

cool gif of SolarCity referrals in this article: One reason for rooftop solar’s rapid growth? It’s contagious.

 

[doggusfluffy]

Can the House and Senate turn two energy bills into one law?

“If Congress had to go deeper into energy policy and try to make changes on things like net energy metering or bigger changes in PURPA standards, it could easily derail legislation or at least make it more challenging to find common ground," he said.

The environmental groups, though concerned about the lack of bigger energy initiatives, applauded S. 2012’s support for “new clean energy technologies like marine hydrokinetic and geothermal technologies that have yet to be commercialized on a large scale.” They also welcomed increased budgets for DOE’s Office of Science and the Advanced Research Project Agency-Energy (ARPA-E).

 

[dandurston]

Looks the "minority share" of ownership that SCTY retained was 5% over the first 20 years in the recent Hancock deal:
With Jim Chanos Short, Is SolarCity The Next SunEdison? The Full Bear Case | Zero Hedge

 

[dandurston]

ER should have a positive effect, right?

We don't know SCTYs actual performance and even if we did, we don't know how well it will be communicate/interpreted/understood. I think it's probably more likely to go negative and maybe re-test $18 but that's just a WAG.

 

[TheTalkingMule]

Looks the "minority share" of ownership that SCTY retained was 5% over the first 20 years in the recent Hancock deal:
With Jim Chanos Short, Is SolarCity The Next SunEdison? The Full Bear Case | Zero Hedge

LOL....read the comments section, these are the folks voting for a certain toupee'd casino mogul. ZH broke a couple good stories prior to the recession and now just feeds it's simpleton base what they want to hear.

I will reiterate that this level of shorting is necessary if we want to get the kind of price action that TSLA saw in 2013. Once this model is validated by the algos at some point this year, these folks will get squozen at a peak in short interest. I'm predicting early August after the 2Q call.

 

[Skotty]

Take a listen at 57:30 when Lyndon gives his 2 cents about the logic of grids requiring access to distributed storage. He gets his point out, but not in a way that any normal person could easily absorb. Not to mention he positions the role of a homeowner's battery pack as a tool of the utility rather than something they "rent out" to the utility. No emphasis whatsoever on the benefit to the customer, just the system. How does he not see that the average potential customer will find that positioning completely unpalatable?

I guess I'm just a total socialist when it comes to power. To me, the whole point of a load balancing battery is to serve as a benefit to the grid (to offset the negative of intermittent generation). If the utility thinks it will serve them better for them to control the way in which it balances, I don't have a problem with that. The benefit to me as a customer is less opposition to renewable power and potentially lower prices to everyone for grid power as the utility will have fewer problems with demand peaks and valleys.