This year’s Solar Power International has one definite theme eclipsing all others: pushing an extension of the federal Investment Tax Credit. Yes, even the movement does have stickers.
However, not all of solar executives feel the same way regarding the ITC, or using the identical amount of intensity.
Berger went further:”We firmly believe the ITC has served its purpose and that it is now time to let it step down as planned.” Even though the ITC is not Sunnova’s preferred method of expansion, Berger reported the solar industry must work within the energy system that exists now, at least until that system receives an overhaul.
“Our official view is…effectively to fight fire with fire, and when everyone’s running around with subsidies, I guess we have got to get ours also,” said Berger.
“I guess if that’s the best thing we have, let’s just extend it and move on,” he continued.
Berger went on to replicate his past calls for grid reform. “What’s going to have to happen is that we are going to have to reevaluate the entire U.S. power industry,” he explained. “We’re growing very rapidly, and those rules need to be changed. […] But I don’t find a great deal of political leaders to have the ability to enable that.”
In light of the leadership vacuum, Berger accepts that an ITC extension may be the most viable political option to continue moving the industry forward. Berger stated Sunnova favors a”consumer-choice driven” industry with an”open, level playing field.”
In July, Texas-based Sunnova became the first U.S. residential solar company to go public in four years, raising $170 million in an initial public offering.
Unlike competitors Sunrun and Vivint Solar which have big in-house installation teams, Sunnova relies on a network of dealers to market and install its own rooftop systems. The company ended the first half of 2019 with nearly 70,000 clients focused in New Jersey, California and Puerto Rico.
Standalone storage tax credit looks unlikely
The solar industry has made strides in advancing storage, evidenced by the numerous storage stalls that cropped up this year in SPI, but Berger said the technology needs a couple more years of price declines to appeal to a larger group of customers.
Sunnova stands among a growing contingent of solar companies, including SunPower, Tesla and Sunrun, in offering battery solutions alongside residential solar. The company now offers its SunSafe battery system to residents of 12 territories and states.
Before this month, Sunnova doubled down on its”consumer choice” message in announcing that a briefer 10-year financing option for its solar-plus-storage systems.
The company is now seeing about 11 percent of consumers choosing to add batteries (by comparison Sunrun has reported storage attachment speeds at about 20 percent, but only in California). Berger stated Sunnova’s storage penetration is currently at only about 2 percent among all of its clients, leaving a great deal of room for growth.
On its Q2 earnings call, the company said that it was looking to grow this number via retrofit earnings — which it offers in 10 states — and bringing on new clients. Berger told GTM that summer that he favors building a”dense customer base” in the geographies Sunnova now serves rather than the usual diffuse sector.
Its recent IPO provides Sunnova more money to play in the storage marketplace. But when it comes to a potential storage tax credit, Berger doesn’t see passthe passagelikely, in part as an ITC is”the path of least resistance”
The absence of a distinct incentive (storage can, under certain qualifying criteria, take advantage of the ITC) didn’t stop Sunnova from introducing SunSafe into the marketplace last year. And Berger said the industry needs to steer clear of getting”too far captured into the weeds of certain tiny topics.”
He sees the industry’s embrace of storage as part of a larger”broad tent” strategy for a decentralized energy system.
