The weekend read: PV in the pandemic

U.S. residential faces trouble over the next few quarters

The U.S. coronavirus emergency stimulus package could contain an extension of tax deadlines for solar, but as of the time of press deadline, the U.S. congress and the Trump administration had not reached agreement on the details of the $2 trillion bill. Stocks bounced higher in anticipation of the deal being signed.

The Democrats have little leverage, but the members of these deliberative bodies must vote by unanimous consent if they are not physically in the nation’s capital – and they are not.

The Solar Energy Industries Association (SEIA) is warning that the impact from the coronavirus could cut the solar industry’s headcount in half. SEIA is trying to push Congress to make the solar federal tax credit payable directly to customers.

Solar installers in the U.S. are already feeling the pain of the measures taken to slow the virus. “The impact of Covid-19 on our business is becoming increasingly severe. Over the past month we’ve gone from sanitizers and hand wipes (three weeks ago), to social distancing with only one person per vehicle (last week), to a partial shutdown as customers cancel or postpone their projects. I expect this situation will get even worse over the next month,” noted Barry Cinnamon of Cinnamon Energy Systems.

He added, “Customers are canceling because they are worried about their financial portfolios, and also want to maintain social distancing. From a portfolio standpoint, we remind customers that solar is just about the best investment they can make in these uncertain times.”

Vendors close to the installer market are being affected. The HR lead at Shoals Technologies Group noted that the solar hardware provider plans “to fully compensate ALL of our employees in the event we need to shut down operations due to Covid-19. This plan will positively impact over 600 people who are paid an hourly wage.”

Roth Capital Partners reports that “some U.S. installers are now seeing a 30% cancellation or postponement of bookings, and the sales funnel is drying up.” Despite the momentum in U.S. residential solar, Roth speculates that U.S. residential demand “could be meaningfully impacted to the downside.”

Roth expects Q2 to be very weak, ”though some believe we could see a strong recovery in Q3,” as well as “a potential oversupply” as production ramps-up and global demand potentially slows.

Cinnamon notes, “Nevertheless, I expect almost all businesses to prepare for a few months of hibernation – no one really knows how this situation will evolve. I also hope that the federal government will pass legislation that will support both hourly and salary workers who are subject to the inevitable work slowdowns.”

Eric Wesoff

Weak dollar adds insult to injury Down Under

Before the Covid-19 outbreak changed the way we interact and do business, Australia’s rooftop PV segment was in robust health and looked set to achieve a world-beating 3 GW in 2020. While installation numbers in January and February were 30% up on the same months last year, mixed reports are now coming from different corners of the market.

Wholesalers have been reassuring customers about their access to stock, but for now, supply appears to remain somewhat limited. Industry players have been talking about two to eight-week delays in supply. Yet, the impact of the outbreak seems to be rather individual – some companies have reported an unprecedented surge in sales and inquiries, while some are saying the phones have stopped ringing.

Installations are still going ahead. Some companies have seen requests for projects to be done before a full lockdown occurs or before price increases hit them. The Covid-19 outbreak coincides with the slide of the Australian dollar, which plunged mid-March to its lowest level since 2002, hailing increases in module and inverter prices for the Australian consumer.

On the positive side, the Government has announced that businesses investments up to $150,000 can be instantly written off on tax. This could be a useful lever to drive uptake of C&I rooftop PV in the months to come.

Marija Maisch

Message from the German installers

In most of Germany, PV systems can still be installed, despite recent actions to flatten the growth of Covid-19. These actions mandate that people stay at home and not congregate in groups greater than two. But unlike some European countries people can still go to work. Accordingly, ten days after the German lockdown, it is still legal to install PV systems. As Christian Kearsley, sales head at installer Solarkönig, notes, “at a single family home installation we arrive with two people.” Up to now the company has not experienced problems when installers arrive. And new orders are still coming in.

But as Kearsley clarifies, these are mainly customers who had been in touch with Solarkönig before the crisis and are moving ahead as spring has arrived and the sun shines longer. Sales are also happening on the phone and in theory this way of interacting could be applied to the entire customer acquisition phase during this time of crisis. Solarkönig generates residential leads mainly online and through social media. But at the end of the day, according to Kearsley, “it is difficult to predict where this trip will end.”

That’s the situation at present. A survey taken during a pv magazine webinar on March 25 yielded a mixed picture. One participant said: “We are still working in the construction sites, but customer appointments are currently handled only by email or telephone.” Another added: “There are considerably fewer orders, since customers do not want to see people outside [their home].” Another issue is the lack of subcontractors for carrying out installations, since many of these employ people from central and eastern Europe, who can no longer enter Germany. Another issue heard frequently is that utilities are limiting their work and no longer installing electricity meters. This would further delay the grid connection of newly installed PV systems.

Michael Fuhs