By Frank Andorka, Editorial Director
2014 is nearly as fresh as newly fallen snow, filled with seemingly endless possibilities.
It’s also the time of year where people like me offer our predictions of what the solar industry will look like 12 months from now (I like to imagine my critics clipping and saving this column so they can come back to me in December and tell me what a fool I was).
It’s a rite of passage. So here are my predictions about what 2014 will look like:
1) Consolidation will continue. The pace of consolidation, which I’ve relentlessly written about for the past two years, picked up significantly in 2013. I expect the trend to continue. I’d even go as far to say the pace will quicken again.
As I’ve written before, this is good. All industries go through it, and it will leave us stronger on the other end. The faster it happens, the better.
2) The focus will shift from module prices to driving down balance of system (BOS) costs. As Paula Mints from SPV Market Research has been preaching for the past two years, module prices have hit bottom. In 2013, they started to rise slightly again. That’s good news for the panel manufacturers, who have struggled in recent years to be profitable as the price of silicon dropped through the floor.
Now the focus will be on driving down everything else in the installation supply chain. We’re not quite at grid-parity nationwide yet, but we’re getting there.
And don’t sleep on permitting costs. Installers tell me this is one of the biggest reasons installation costs are still so high. There are several efforts under way to streamline them nationwide, but I’m not hopeful it will happen this year.
3) The national energy policy we all crave (that has been introduced — again — in the Senate) won’t even make it out of committee. Until we get a national energy policy (like every other leading solar country in the world), we will lag behind everyone else.
Why? Because when you have 50 states making 50 separate solar policies, reliably planning projects is nearly impossible. But 2014 is another “Year Of The Midterm Elections,” which means exactly nothing will get done in Congress (then again, that was true last year, and the solar industry flourished).
In the meantime, the state-by-state battle on net-metering will continue apace. These are battles we have to win, so get on this.
So there they are — my fearless predictions for the 2014 solar industry. I’d like to hear yours, so contact me at fandorka@solarpowerworldonline.com. I look forward to engaging in a spirited discussion.
(Editor’s Note: An earlier version of this post misidentified Paula Mints’ place of employment as Navigant Consulting. We apologize for the error.)
solution above US says
Frank, I believe you & Paula are correct!
“As Paula Mints from SPV Market Research has been preaching for the past two years, module prices have hit bottom.” (see chart…
carterl says
100% agree on point number 3 (and 2 and 1). It’s good to be realistic about what we’ll get out of Washington- nothing. IF something were to ever happen there it’d be big news for us so we have to keep an eye out, but the battle is on the state-level.
Eze Igbo says
QUITE IMPRESSIVE BUT NEED TO REGULATE THE MANUFACTURING AND INDISCRIMINATE MARKETING PRICES OUT THERE
Sohan says
Totally agree with your predictions Frank – I’ll also add that there will be a rise of Utility scale Solar in the Upper Midwest at a pace never seen before
ecoSolargy, Inc. says
Seems like more action needed from municipal and federal governments. Of course the Net Metering battle is everywhere….
Allyson Lin says
Although focus will swift to BOS cost but the 1st thing they do is still cut price for module cost.
Pamela Cargill says
Overall a good swath of predictions. But ‘ll go out on the limb and say something really politically unpopular as a follow-up.
As an industry, we are living and dying by net metering policies. Our business models, financial analyses, and livelihoods depend on it. However, if we are going to achieve massive scale adoption of solar, especially residential-scale distributed, we must become more willing to work WITH the utilities and especially ISOs (independent system operators – the folks who run the grids) to explore new business models for the valuation, remuneration, and interoperability of small solar distributed generation systems.
Remember, massive business model shift have already happened at least twice in the post-thermal-driven solar industry (early 2000s for the shift from off grid to grid-tie, 2007 for cash-basis to third-party-ownership domination).
It is in our best interest to not remain satisfied with the status quo.
Circular Energy says
Well said. Creating sides will not be good for the longevity of the solar industry. Our entire industry should consider the utilities partners and be working alongside them to resolve their concerns.
solution above US says
Yes, “we are living and dying by net metering policies.”
Or,
Get OFF the GRID!! (Storage systems are now capable & booming for residential & commercial PV!