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1. Green:Net to Welcome California State Officials
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2. First Solar's Strong Earnings, Weak Outlook Roil Its Stock
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3. PG&E to Own Photovoltaic Solar Plants, Could Act As "Green Knight" for Solar
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4. Daily Sprout
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5. PG&E to Announce Solar Investment?
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6. Smart Windows Open Up More Funding for SAGE
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7. Eurus Energy to Build 1 MW Solar Plant in Cali
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8. Can First Solar Shake the Earnings Blues?
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9. Does the U.S. Need a Federal Reserve for Energy?
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10. Mary Nichols Wants the Feds to Look West
Green:Net to Welcome California State Officials
Katie Fehrenbacher - Policy
We’ve all heard how California has aggressively cut energy consumption through energy efficiency programs — the state has saved a good $56 billion in electricity costs over the last 30 years. And in the next decade the state is aiming to cut carbon emissions down to 1990 levels. What has helped and will help those energy reduction plans? Software and digital tools that can smarten up energy use in buildings and across a smart grid.
California’s Department of General Services agrees with that sentiment to such an extent that two of its officers — Will Semmes, Chief Deputy Director of the California Department of General Services, and Adian Farley, Chief Deputy Director for Policy and Program Management — will be speaking at our Green:Net conference in San Francisco in March. Om and I will be interviewing the duo about how the state is using infotech to reduce energy consumption and how entrepreneurs and innovators can work more closely with the state.
If you have digital technology that you think California just can’t do without, be sure to meet up with the duo at Green:net. Get your tickets soon — the Super Saver Discount ends this Friday. You can register here.
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
First Solar's Strong Earnings, Weak Outlook Roil Its Stock
Kevin Kelleher - Big Green
Investors loved the numbers they saw in First Solar's highly anticipated earnings report Tuesday afternoon. They they tuned in to the conference call and hated what they heard about the company's outlook for this year.
For the three months ended Dec. 27, 2008, First Solar reported revenue of $433.7 million, up 116 percent over the same quarter a year ago, and a net profit of $132.8 million, or $1.61 a share. A year earlier, First Solar reported revenue of 77 cents a share. That was much better than what analyst had been expecting: $410.4 million in revenue and $1.30 a share in profit.
After that report came out, First Solar shares were up as much as 4 percent at $143.03 in afterhours trading on the news. That followed a 10 percent jump in share prices during active trading Tuesday, when FSLR closed at $137.68.
Then came the conference call. First Solar executives said that between 10 percent and 15 percent of their customers are at risk of defaulting on their contracts. That's not a new development — First Solar made a similar warning three months ago — but in this climate it is unsettling. Then they said revenue would be "flat to slightly down" for this quarter and between $1.8 billion and $1.9 billion for the full year. That range is below the $1.98 billion that analysts had been expecting for 2009.
The decreased guidance is due to $200 million in revenue that will be deferred because of equity co-investments that First Solar is making in projects in Germany and possibly elsewhere. It seems the co-investments were necessary for the projects to draw other backers in the tough financing environment.
First Solar's CFO Jens Meyerhoff suggested there may be other such investments, which could reduce its guidance further. "If market uncertainties continue to increase, particularly around financing, we could reach a point, in our opinion, where continued guidance would provide little useful info to our investors," he said.
Those details caused investors in the aftermarket to sell First Solar. The stock fell 20 percent from $143.03 to $113.75 in a little more than an hour.
It's not all bad news, though. First Solar said the falling prices of crystalline silicon solar panels are not forcing it to drive down prices on its thin-film products. Meanwhile, its manufacturing costs fell to 98 cents per watt from $1.08 per watt in the previous quarter, and should fall further to around 65 cents per watt in the long run.
First Solar is facing a tough year, but it could emerge stronger from it. CEO Michael Ahearn summed it up by contrasting the long view with the short run. "Looking out three to five years or beyond, the market outlook for solar power has never been better," he said. "But the short term outlook has never looked more difficult."
Image courtesy of Google Finance.
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
PG&E to Own Photovoltaic Solar Plants, Could Act As "Green...
Katie Fehrenbacher - Energy
The program is similar to the one Southern California Edison (SCE) unveiled in March of 2007, which is seeking to develop 250 MW of photovoltaic panels across roughly two square miles (collectively, some 65 million square feet) of commercial building rooftops. But PG&E’s plan is different in a couple of key ways; according to Fong Wan, senior V-P of energy procurement for PG&E, the company deliberately structured it in such a way as to avoid some of the same pitfalls.
While SCE’s program is aimed at commercial rooftop space, PG&E’s solar PV projects will largely focus on ground-mounted systems, allowing the utility to forgo having to acquire rooftop space from building owners. And PG&E is dedicated to working with different independent developers, on projects of 1 MW-20 MW in range, so a variety of contractors will likely be involved. SCE has largely been managing the solar rooftop installation itself.
While PG&E’s solar investments may seem par for the course for a utility, in fact they’re a big deal. As we pointed out earlier this morning, PG&E can use its taxable income to provide much-needed funding for companies to get solar plants up and running. A lot of the solar projects from which PG&E has agreed to buy power are being built by young startups, which by nature can be risky, unreliable, and prone to failure — particularly in these difficult economic times when capital is scarce. Expect to see some of PG&E’s PV solar partners — like OptiSolar — celebrating this news.
PG&E CEO Peter Darbee told the audience at a press event this afternoon to expect more of these types of solar financing methods from PG&E. He said the utility is discussing a similar investing project for solar thermal projects, as well as ways in which the utility can act as a so-called “green knight” for solar projects that are having trouble accessing the capital markets. In the latter’s case, PG&E would focus on solar projects being built with the least risky technology possible, Darbee said.
PG&E plans to spend $1.4 billion in capital expenses on its portion of the solar photovoltaic program, and is expecting a return of at least 8.7 percent. The program needs to be approved by the CPUC, but Darbee said PG&E modeled its plan closely to that of SCE’s and as such expects the approval process to be a swift one.
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
Daily Sprout
Josie Garthwaite - Misc
U.S. to Set Single MPG Standard for Cars, Trucks? Carol Browner, assistant to the president for energy and climate, says she and others in the White House back the idea of a universal fuel-efficiency standard aimed at curbing greenhouse gas emissions. — Washington Post
Growing the Google.org Team: Larry Brilliant says Google’s philanthropic arm, Google.org, is getting more engineers and technical staff, a stronger focus on IT-based projects like RechargeIT, Clean Energy 2030, and PowerMeter — plus a new manager. — Official Google.org Blog
Bush Enviro Adviser Jumps Into Energy: James Connaughton, former chairman of the White House Council on Environmental Quality, joined Constellation Energy Group today as executive V-P of corporate affairs, public and environmental policy. He’ll guide development of the company’s renewable energy and nuclear portfolios. — Press Release
Midwest Governors Push for Ethanol, Wind: Governors from four Midwestern states pressed the EPA yesterday to increase the percentage of ethanol allowed in gasoline blends beyond the 10 percent that automakers say can corrode fuel lines, and to issue mandates and tax credits for wind energy. — BusinessWeek
Green Desert Metropolis: Oil-rich Abu Dhabi is trying to build a zero-emission, car-free and zero-waste city. Should the rest of the world care? — MIT Technology Review
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
PG&E to Announce Solar Investment?
Katie Fehrenbacher - Energy
The press release says the reason for the media event is:
With many renewable power projects delayed, PG&E is committed to finding innovative new ways to add more clean energy to our power mix in order to protect the environment and meet our customers' expectations.
Sounds like a solar investment plan to me. PG&E generates billions in taxable income and could provide much-needed funding for companies to get solar plants up and running. It's significant because utilities don't traditionally own solar power-generating systems, and the sagging economy has been forcing solar companies to delay construction of plants and cut staff. There's another reason: insurance. A lot of the solar projects from which PG&E has agreed to buy power are being built by young startups, which by nature can be risky, unreliable, and prone to failure — particularly in these difficult economic times when capital is scarce. Now, will a company or project be named in the deal? We’ll keep you posted.
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
Smart Windows Open Up More Funding for SAGE
David Ehrlich - Big Green
Updated: SAGE Electrochromics said today that it has raised $20 million in a third round of funding for its smart window tinting technology. The new cash comes from Good Energies, Applied Ventures — the venture capital arm of Applied Materials — and Bekaert.
in Faribault, Minn., where SAGE is headquartered. (update: the company hasn’t picked a location yet.)
This fresh infusion of venture capital for SAGE may not cover the cost of a new factory, but some of the cash will be used for production. SAGE said it will use the funding to expand its work in international markets, as well as in new product and business development, manufacturing, and sales and marketing.
SAGE’s windows are made with an all-ceramic stack of thin-film coatings on a glass substrate. A low voltage of DC power can switch the windows from letting in more than 60 percent of visible light, down to less than 5 percent. The DOE has said that electrochromic windows can cut air conditioning costs by up to 20 percent per year in commercial buildings. The company already has a small-scale manufacturing plant in Faribault, and said that since its last round of funding, it’s already sold and installed its smart windows in a number of commercial and residential projects. SAGE raised $16 million in July 2007 from the same group of investors — Good Energies, Applied Ventures and Bekaert.
SAGE isn’t the only company waiting for a DOE loan — a total of 16 firms were picked to submit full applications for the loans back in 2007, including Tesla Motors, which is waiting for $350 million from the DOE to build a factory for its new Model S sedan and for battery development. Last week, Energy Secretary Steven Chu announced some changes at his agency to speed up those loans, with the cash potentially showing up by late April or early May. But the agency said that even if the loans are approved, companies could still be required to secure their own share of the financing or meet other conditions before the loans are closed.
Updated with more info: “This is a major expansion on current operations,” John Van Dine, president and CEO of SAGE, told Earth2Tech. He didn’t disclose how big the new factory will be, but said the entire project is expected to cost $120 million. The company has yet to pick a location for the new plant, but Van Dine said it will definitely be built in the U.S. “We just signed up a site selection firm,” he said. “They will be working with us to identify the most appropriate site for this investment.”
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
Eurus Energy to Build 1 MW Solar Plant in Cali
Josie Garthwaite - Energy
This latest project comes just over a month after Eurus Energy’s U.S. subsidiary ventured into solar power with the creation of a new team focused on building large-scale photovoltaic projects in Western states. The new plant would bring Eurus’s renewables operating capacity to about 250 MW in California, a state where more than 30 utility-scale solar plants have been proposed in the last 18 months (we’ve mapped them here). Operations in other U.S. states, as well as in Japan, South Korea and Europe bring the company’s total renewable capacity to 1.7 GW.
Photo credit Tokyo Electric Power Co. (Fuji Service Center)
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
Can First Solar Shake the Earnings Blues?
Kevin Kelleher - ESLR
Solar companies have spent the past few weeks reporting their latest quarterly results, and the sector is looking battered. Many big names reported discouraging financials for the last three months of 2008, then followed up with even less cheery forecasts for 2009.
But after the stock market closes Tuesday, the solar industry’s favorite son, First Solar steps up with its report. And if any company can buck the trend, it’s First Solar. The stock has held up relatively well so far in 2009; as of Monday’s close it was down 9.5 percent. The S&P 500, by contrast, is down 18 percent. Other solar companies are down even further: Solarfun has fallen 43 percent this year, JA Solar has slid 52 percent, and Evergreen Solar has lost 63 percent of its value.
The reasons for the solar slump are simple enough. The credit crunch is hurting the ability of solar panel manufacturers to raise capital to expand future production. The prices of their goods are falling quickly — a welcome development in the long run since it will make solar panels an attractive option to traditional energies — but a grueling process until then. And despite hopes that governments will boost spending on solar energy, there are lingering concerns that at some point that public money may dry up.
Optimists hope it will be different for First Solar. The company is one of the most favored by alternative-energy investors. It’s still winning deals in high-profile projects around the world. And there are indications that its thin-film solar technology is already as cheap as conventional electric power.
But some on Wall Street are rethinking what up until had been a healthy consensus forecast. As Barron’s noted, certain analysts cut their forecast or price target for First Solar on Monday, citing concerns about the company’s outlook for this year. First Solar’s stock ended the day down 7 percent at $124.84.
That leaves a lower bar for First Solar to jump over, if it can. But if First Solar can’t impress investors, it could spell bad news for other solar stocks.
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
Does the U.S. Need a Federal Reserve for Energy?
Katie Fehrenbacher - Policy
Is the Federal Reserve a good model for oversight of energy policy? John Hofmeister, founder and CEO of Citizens for Affordable Energy, certainly thinks so. He told an audience at the Berkeley Energy Symposium Monday afternoon that the current political system governing energy policy in the U.S. is dysfunctional and should be replaced with a Federal Reserve-type independent board.
While energy policy currently moves on “political time” — the several years it takes officials to get elected — it needs to move on “energy time,” or the decades it takes to plan and build energy assets like fossil fuel generation plants and nuclear facilities, Hofmeister said. An independent Fed-type board would have a more long-term view of energy policy because its board members would be made up of energy experts with terms that outlast those of elected officials, explained Hofmeister. Partisan politics is crippling energy policy and we need to create such a board to move “beyond politics,” he said.
The result of such a system, Hofmeister claimed, would be a stabilizing of energy markets — for example, the board could help with the dramatic price spikes and drops of gas prices. Such a board could also help energy regulation move away from short-term policies, like the current tax credits that give funds for clean power projects, but that are routinely extended by only a couple years at a time.
While many at the conference applauded Hofmeister’s suggestion, ultimately he didn’t give very many details of what such a board would actually do or what steps it would take to reform energy policy. And that was despite repeated questioning and prodding from the audience. In particular Severin Borenstein, the director of the University of California Energy Institute, pointed out in a Q&A session with Hofmeister that there could be real problems with an energy board that wanted to manage U.S. energy prices without regard to those of the rest of the world.
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
Mary Nichols Wants the Feds to Look West
Katie Fehrenbacher - Policy
“We know investing in clean technology can have a positive impact,” said Nichols, who pointed out that the implementation of energy efficiency technologies in California over the past three decades has resulted in the creation of some 1.5 mbillion jobs and the saving of $56 billion in electricity costs — money that was then invested elsewhere in the state, further driving its economy forward.
To be sure, Nichols’s job description includes touting California’s energy programs. But she isn’t just blowing smoke, and in fact the federal government is already looking closely at California’s emissions policies. President Obama recently directed the Environmental Protection Agency to reconsider California’s long-contested waiver that will allow it to enforce stricter automobile-emission standards. Nichols was quick to point out Obama’s praise of California’s emissions policy in his press conference on the EPA directive.
Nichols insisted that other California policies in the works would continue to make the state a leader. Those include working on a low carbon fuel standard, allowing for competition in electricity and fuel markets, setting an aggressive renewable portfolio standard for a percentage of clean power, putting a cap on emissions, and implementing tools to reverse unsustainable sprawl of development.
Beyond outlining California’s lessons, Nichols also have a couple of requests for the folks back in D.C., such as the creation of a central repository for emissions data. And Nichols did applaud one federal policy: the federal Clean Air Act, which she said has been successful in achieving its goals. In fact, her organization would like to see it be used as the basis for all emissions legislation, she said.
Hear Microsoft, IBM, Dell and Cisco execs at GigaOM’s Green:Net.
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