Samuel Adeyemo, co-founder and chief operating officer of Aurora Solar, kicked off the company’s Virtual Solar Summit July 23 with the results of an informal survey of the installers and other solar professionals who had registered for the event. However self-selected, the responses offered a topline look at a U.S. solar industry adapting as fast as it can to the challenges and opportunities of the Covid-19 pandemic.
For example, virtual sales were tagged as both the top adaptation to Covid-19 (63%) and the leading opportunity for business growth (32%). Meanwhile, both remote site assessment and online permitting were also cited as key adaptations to the pandemic, and more than one speaker at the conference talked about the industry’s move to a digital or “platform” model as positive and more than likely permanent.
Similarly, the growth of the residential market clearly lies in expanding services. The preconference survey found 74% of those responding are now offering storage, while 48% have started installing electric vehicle chargers.
In an opening keynote, Jigar Shah, founder and president of Generate Capital, a sustainable infrastructure developer, said the pandemic has underlined solar’s status as “one of the largest, most trusted industries in the country.”
“It’s critical for us to recognize that we are being looked to by everyone from prominent political campaigns to elected officials in your town to provide the necessary economic development to get us out of Covid,” he said. “After the financial crisis of 2008, we created about one out of every 10 blue collar jobs for the next eight years, and today, we have over 200,000 people who are being deemed essential — our work is essential — because we’re moving the country forward.”
Staying ahead of the pandemic
The companies best able to manage financial risk and leverage digital technologies were also those that were best prepared for and continue to ride out the pandemic’s economic impacts.
Covid was even not on the horizon at the end of 2019, when Chris Kemper, founder and CEO of Palmetto, a solar installer known for its strong digital platform, started preparing his company for the 2020 recession he saw coming. But, by minimizing financial risk with strong credit lines, he said, once the pandemic hit, his team was able to stay focused on growing the business.
“We saw all our metrics spike, and didn’t miss a beat,” Kemper said.
In Florida, the state’s Solar Energy Industries Association — FLASEIA — started mobilizing its members in late February, said board president Justin Hoysradt, who is also CEO of Vinyasun, a West Palm Beach installer.
“We started pushing out a lot of early data on Paycheck Protection loans and SBA loans, letting them know, it’s time to get on the phone with your accountant, to really get your financial house in order,” Hoysradt said. That preparation paid off in “a lot of financial help,” especially for smaller installers, he said.
Virtual sales and high-intent customers
Hoysradt was also one of several speakers who stressed the importance of virtual sales. Vinyasun already had a “heavy tech stack,” he said, but the pandemic accelerated the company’s integration of digital tools and virtual communications.
“The nice thing about these opportunities with Zoom or other platforms is that managers and co-workers can jump into a conversation and co-sell without leaving their desks,” he said.
For those without the budget to invest in new technology, he said, one solution is “to partner with a company that has already done so.”
The growth of virtual, remote sales also reflects a shift in customer demographics and expectations, said JP Gerken, founder and CEO of Zenernet, a California solar company built exclusively on remote sales. Zenernet customers, he said, are “very informed, high-intent customers. You can see they are shopping aggressively, trying to find out the best company to work with, what equipment they should be buying and how financing works.”
Gerken added that remote, virtual sales require different skills and expertise than in-person, in-home selling. Installers going virtual need “to really understand what customers are looking for and what that process needs to be, and really work through each point of your process to make sure it’s the most efficient and effective and creates the most value and trust with your customers.”
Diversity and inclusion
Amid continuing protests over the killings of African Americans by police and others across the U.S., the solar industry as a whole has recognized it has serious work to do on diversity, inclusion and social equity. Palmetto’s Chris Kemper and Ben Peterson, CEO of Blue Raven Solar, based in Utah, both described how their companies have formed internal working groups to tackle issues such as unconscious bias in hiring.
“You need to be having conversations with the people with the backgrounds and experiences that you are looking to hire,” Peterson said. “Then — guess what? — you get to the opportunity to hire them and they get the opportunity to benefit your organization.”
Hoysradt sees the current focus on diversity and inclusion as a broader opportunity for the solar industry as a whole to break down its traditional compartmentalization of climate change as an issue separate from racial and economic inequality.
“This moment further reveals the absolute, deep interconnection between climate change, economic inequality, systemic racism and attacks on our democracy,” he said. “If we are going to solve any of these issues, we have to address them all simultaneously.”
Solar financing
In the solar finance space, Covid-19 has had the unexpected impact of driving a high number of projects, according to the experts on a panel on project funding. Meetings on Zoom are easier to set up, said Jason Kaminsky, chief operating officer at kWh Analytics, and online permitting and other virtual tools have generally accelerated the pace of business.
At the same time, Kaminsky said, the uncertainty of markets at present has made investors more conservative, which means solar developers would be wise to stick to “vanilla deals,” for example, straightforward power purchase agreements. Another major piece of advice from the session, check in with your banker regularly, not only when you need a loan.
On the residential side, Erin Talbot, chief lending officer at Mosaic, a residential solar and efficiency financier, said the pandemic could be a proving ground for 20-year consumer solar loans. In cash crunches, she said, Mosaic has seen that homeowners are likely to put a solar loan high up in their “payment hierarchy” — which bills they pay first.
“When we get to the other side of this as an industry, and the solar loan proves itself to be a very stable and well-performing asset, that will bring more capital and lower-priced capital into the industry,” she said.
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Thank you, good article. All reasons why I am invested in solar and associated stocks.