This is the first article in a two-part perspectives series on the future of U.S. solar advocacy. Read the response from SEIA here.
We don’t call it the “solar coaster” for nothing.
This year, U.S. solar installations will hit roughly 14 gigawatts. These solar installations are having a big impact in communities all over the country. Our industry employs over 200,000 people, over 1 million homes now host PV systems, more solar is being deployed than any other energy source, and solar is delivering electricity at a value greater than new natural-gas plants across the country.
But with profitability challenges and regulatory uncertainty at the state level, the solar coaster is about to take another turn -- just when we have a leadership vacuum at the top and when monopoly utilities are intensifying efforts to eliminate net metering.
These challenges also come at a time when the Solar Energy Industries Association (SEIA) -- which ostensibly represents all solar businesses in the U.S. -- has created a governance system that favors utility-scale solar interests. In fact, the majority of solar companies and employees in the U.S. are focused on rooftop solar and distributed generation.
We want you to sign our petition to let SEIA know that local residential and commercial solar companies want to have the same voice and influence as our brothers and sisters in utility-scale solar.
If you have solar on your roof, if you work for a solar company, if your business is powered by solar, or if you just want the benefits of clean solar energy without lining the pockets of monopoly utilities, please sign our petition. And pass it on to your friends.
It’s been a five-decade journey to get to the point where distributed generation solar power is often cheaper than power delivered by your local utility. New solar and storage technology will continue this transition to cheaper and cleaner local power. Unfortunately, homeowners, businesses and local solar companies will not benefit as long as incumbent utilities leverage their money and monopoly status to influence both state and federal solar policies.
Just look at what happened in Hawaii, where the local utility put an end to net metering. Or in Nevada, where the dominant utility changed billing for 32,000 solar customers so that home solar no longer makes economic sense. Or Florida (the Sunshine State?), where monopoly utilities campaign to tax home solar installations and make it illegal for homeowners to lease a rooftop solar system.
But changes are coming.
Earlier this year, the Solar Energy Industries Association reluctantly said goodbye to its long-time CEO, Rhone Resch, who left after over a decade of service. Under his leadership, the solar industry introduced and passed a 30 percent tax credit in 2005, extended it for eight years in 2008, and then again for another five years in 2015. The majority of the membership dues to fund SEIA came from its hard-working industry board, which consisted mainly of manufacturers and large-scale developers, supported by smaller companies active in solar thermal and distributed solar.
Many of us “old-timers” have seen these gyrations in the solar industry before. As an industry should do, we need to look forward to the technology and structural cost changes that are underway right now -- and adapt to them. National and state priorities need to reflect our business and climate goals. After the extension of the Investment Tax Credit, many are wondering what the next decade of SEIA priorities really should be.
Do we need an organization that is heavily focused on the federal government? Should SEIA be on the front lines leading the effort at the state level? How do we balance the benefits of distributed solar with the profit motivation of regulated utilities, many of which are actively trying to block Americans from investing in solar?
SEIA and state solar chapters have done a solid job on behalf of the solar industry. Everyone employed by the solar industry owes them a debt of gratitude. But even with the extremely talented staff led by a very capable Tom Kimbis, they are increasingly showing their inability to keep up with the incoming onslaught by traditional fossil fuel and utility interests.
Yes, we got the tax credit for a few more years -- but there is a big gap between the current market and the addressable market.
We should not be trailing Australia’s 15 percent solar rooftop penetration. And we don’t want the distributed solar market to stagnate as it has in Europe. In fact, the entire European Photovoltaic Industry Association board has been taken over by utility-scale players often openly hostile to the distributed solar market.
The solar industry has the most active employee and advocacy base ever mobilized in the clean energy space. Yet its messaging is being led by environmental groups and foundations, instead of SEIA. The core of the distributed solar industry lies with hundreds of companies with $5 million to $100 million of annual revenues that are consistently profitable every year -- almost all of which are only basic members of SEIA.
More than 1 million homeowners now have solar -- which means there are now over 100 million Americans who know someone with solar on their roof.
Solar industry leadership is focused almost entirely on minutiae in Washington, D.C. Right now, the primary movers on the SEIA board are large corporations, many of which have aspirations that are less local and more global, less rooftop solar and more utility-owned solar. In a nutshell, the dominant interests on the SEIA board are not making room for the vast majority of solar installers and customers in the U.S. Some are even pandering to utility arguments to reduce the value of solar through changes in net metering and other tariff taxes.
At the moment, almost every one of the major solar states are in a pitched battle to preserve the stability of their local markets. Local installers are doing the best they can within their local state chapters with virtually no funding from SEIA for their priorities. While the extension of the solar tax credit was essential work, the right to legally and profitably install solar on customer rooftops is even more essential.
The most pressing issues for solar installers include interconnection costs, net metering, local incentives, codes and standards, and punitive property taxes. They also need help finding affordable insurance, healthcare, benefits, and other programs that address the challenges that often plague small businesses. Many trade associations provide these services to member companies as a block. Given the right structure and outreach at SEIA, a focus on these services would increase membership and boost revenues.
There is a search underway to find a new permanent executive director SEIA. It is time to look forward to the solar industry of the future, not backward. California’s SEIA chapter is showing the way. In just three short years, it has tripled its budget by enrolling these $5 million to $100 million companies. More importantly, it took back messaging from environmental groups and delivered on “do or die” local needs.
Taking this same approach across the country means we need to be open to changing the way SEIA prioritizes activities. Below are four suggestions.
- Take a democratic approach that responds directly to a representative cross-section of industry members on renewable portfolio standards, net metering, interconnection, codes and standards, property taxes and ballot initiatives.
- Bring all of the state SEIA chapters into the SEIA family, with executive directors paid by SEIA and given a formal role on the board in proportion to their ability to fundraise from their $5 million to $100 million revenue members.
- Continue to hire high-quality staff in D.C. that plays offense and defense at the federal level to weigh in on the Clean Power Plan, PURPA, and many other issues.
- Hire an executive director with proven leadership experience that can double the budget of SEIA by bringing in profitable mid-sized companies.
The solar industry has over 200,000 full-time employees, over 650 manufacturing companies and over 1 million solar system owners. This potent ground force can and should be directed by SEIA. We should welcome, but not rely on, the help that we are getting from national environmental groups and foundations. Whether the issue is about carbon pollution, electricity reform, local economic development, or the many other hot-button issues, SEIA needs a position that is thoughtful, widely disseminated and effectively pursued.
We can and should use this moment to coordinate our message to grow the power of our industry.
This presidential election -- more than any other -- has shown that a small group of engaged people at the local level can have an outsized voice in the future of our country. But they must be led. SEIA has not had a mandate to lead outside of D.C. In fact, it has deliberately not weighed in on important solar industry issues. This has to change.
We are at an amazing moment today, in no small part because of the job SEIA has done in getting the industry to a series of tremendous milestones. However, the fight has shifted from the federal to the state level. Let’s democratize our solar organization by getting more Americans involved. Together we can bring about the future that we all want for our country.
Jigar Shah is the president of Generate Capital. Barry Cinnamon is the CEO of Spice Solar. You can find their petition here.