Sunrun reported that first quarter revenue rose to $334.8 million, 59% higher than Q1-2020, putting the company on a path that just might end up as its best ever.
During an earnings call, Sunrun’s chief financial officer Tom vonReichbauer raised the company’s 2021 solar energy installed growth rate from 20-25% to 25-30%. He said that Sunrun’s execution, scale advantages, differentiated service offering, and competitive position factored into the company’s decision to revise its forecast.
“The strong momentum that we saw in the fourth quarter has continued into 2021,” he said. “Consumer demand for alternatives to an old, expensive and dirty energy infrastructure continue to increase at a rapid pace.”
Lynn Jurich, Sunrun’s CEO, said, that consumer adoption of electric vehicles is likely to drive further solar adoption as those same consumers want to use clean energy to power their vehicles.
EV strategy
“The purchase of an electric vehicle can create a moment where it makes sense to make an investment [in solar or solar plus battery storage].” Homes with electric vehicles consumer around twice the amount of electricity as non-EV homes, she said.
Sunrun is investing in business development efforts around the EV point of sale, she said. To large manufacturers, Sunrun’s nationwide footprint and its broad geographic reach offers an appealing business model for partnerships, she said. One strategy is to further integrate batteries into home energy management systems as the demand to instantly dispatch power from the battery becomes increasingly valuable.
“Early innings”
“We’re just in the early innings of people feeling the resiliency pain around outages,” she said. Outages, like those experienced in California and Texas, will drive consumer interest in batteries, she said.
She said that over time, effectively all solar will be paired with storage as battery prices fall and it becomes evident that aggregating batteries is the most effective way to deliver peak power. Batteries can help smooth out intermittency issues of a renewable-based system, she said.
Attachment rates for Sunrun’s Brightbox batteries hit a fresh record in Q1, the company said. Despite supply constraints, Sunrun said it expects more than 100% growth in battery installations in 2021.
“The bad news is that we would be growing [our battery business] even faster, if not for the tightness of the market,” said Edward Fenter, executive chairman. One impact of the tight market is that end pricing for batteries has not fallen along with input prices for those batteries.
But Jurich said that as manufacturers expand their battery offerings, supply constraints will ease, allowing Sunrun to meet pent-up demand and accelerate adoption.
According to Sunrun, its effort to further electrify homes includes converting natural gas appliances to electric. Sunrun said that this provides another opportunity to increase its share of the home energy wallet and enhance its value to customers.
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