2017 is going to be a tricky year for the U.S. solar industry. Fewer PV panels will be deployed across the U.S. than in 2016. However, despite a slightly contracting market (a rarity in the history of this industry), the U.S. will still install an estimated 13.7 gigawatts this year. That's going to keep a lot of employees busy even while costs for solar systems continue to fall.
The number of jobs created to make, sell and install solar panels in the U.S. grew at a record pace last year, and grew much faster than the overall American economy, as per a new report from The Solar Foundation. The report found that there were 260,077 solar workers as of November 2016 — an increase of 51,000 jobs, up 25 percent over 2015.
That high job-growth rate is unlikely to continue into 2017. The report estimates that the job growth rate will be closer to 10 percent this year.
That's the relatively good news.
Although 2017 is going to be a mostly flat year for solar industry revenue, it will still be a year where market leadership in installation, modules, inverters and balance-of-system technology remains highly competitive and volatile.
And that means there are going to be some casualties.
OneRoof Energy “winding down”
OneRoof Energy is (was?) a second-tier residential solar financier that never seemed to get enough market traction, while making some counterintuitive business moves.
Late last month, OneRoof issued a release revealing that it was “in default under its head office lease for failure to pay rent. This default also creates a default under the Company’s secured loan facilities, giving the secured lenders the right to accelerate and demand immediate payment of all outstanding balances, including principal and accrued interest, under such loans, totaling approximately $100 million in the aggregate. The Company’s liabilities under the secured loan facilities greatly exceeds the value of its assets, and an acceleration of the secured loans could result in the foreclosure of all or substantially all of the Company’s assets.”
OneRoof raised a lot of money. In 2013, OneRoof added $100 million from Morgan Stanley and Main Street Power Company to its funds. OneRoof raised more than $80 million in operating and finance capital from Hanwha, Black Coral Capital, U.S. Bank, The Quercus Trust, Yellowtree Energy, GDF SUEZ Energy and Spring Ventures.
In 2014, the firm gained access to funding as a public company via a reverse merger on Tier 2 of the TSX Venture Exchange, that innovation hotbed.
During this “winding down” period, Senior VP Dalton Sprinkle will shift his $280,000 per year salary to a daily rate of $2,800 per day. CEO David Field will now get a severance payment of $266,000 if “substantially all of the Company’s solar project assets are subject to definitive sale or refinancing agreements on or prior to February 28, 2017, or if he is terminated prior to February 28, 2017 without Cause or resigns for Good Reason.” If the conditions aren't met, Field would get $133,000.
The CEO once told GTM, “My business is the acquisition of non-regulated customers. It is not necessarily the business of putting solar on rooftops.”
Enphase gets McKinseyed
We've been following the travails of PV microinverter pioneer Enphase as it struggles to regain its footing.
In early January, T.J. Rodgers, founder of Cypress Semiconductor, and John Doerr, chairman of Kleiner Perkins, invested $10 million in the firm. Rodgers joined the board of directors.
A release describing the investment included this information: “Enphase anticipates using a portion of this investment for consulting services to optimize operating performance while supporting the growing global demand for its energy management systems.”
Those “consulting services” translated to McKinsey being hired, according to an investor note from Roth Capital, followed by McKinsey doing what McKinsey does.
On January 30 Enphase reduced its workforce by “approximately 18 percent of total headcount throughout all areas of the organization to lower operating expenses.” That's roughly 80 jobs. Enphase estimates it will incur “approximately $2 million in cash-based termination costs.”
This cut follows a layoff of 11 percent of its workforce in September 2016.
Residential PV installer American Solar Direct institutes layoffs despite “positive momentum”
In 2013, GTM Research named American Solar Direct as a residential PV installer to watch.
At the time, ASD was one of the few top-20 installers that had experienced consistent, positive quarter-over-quarter growth since it began installing PV systems in 2010. The company, founded in 2009, began in Los Angeles and expanded to San Diego and Northern California in 2012. ASD raised its own project funds and received two rounds of equity investment, as well as $50 million to support its lease program from WGL Holdings, parent company of utility Washington Gas.
But recently, ASD has had a round of layoffs, aimed at “low producers,” as well as some office consolidation, according to COO Andrew Schneider. He noted that despite the layoffs, the situation was full speed ahead at the company, which had its first cash-flow positive months in November and December and partnered with Swell Energy on energy storage.
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