by Kevin Tidmarsh
The US-based solar energy company Sunrun, which claims to have “the second largest fleet of residential solar energy systems” in the country [http://fortune.com/2015/06/26/sunrun-ipo-solar-silicon-valley/], has announced that it has secured funding that points to a bright future for the company. While the market for solar energy is still nascent, Sunrun has done rather well for itself – especially given tighter state regulations and the financial difficulties of the renewable energy industry. But in spite of new regulations in the famously sunny state of Nevada that forced the company to withdraw operations from the state, the company is feeling good about its prospects and future – in no small part due to the company’s recent announcement that they have closed $250 million of senior secured credit facilities for its future growth [http://www.forbes.com/sites/peterdetwiler/2016/02/03/sunruns-250-million-in-financing-a-positive-sign-for-distributed-solar/#11aad2306cbc].
Sunrun was founded in 2007, when solar panels looked much less financially practical than they do today. During the company’s inception nine years ago, the average price of solar panel installantion was three times what it is today, and only 160 megawatts of new solar panels were installed annually. Today, the market is much friendlier to solar power – over 8,100 megawatts of solar power were estimated to have been installed last year [http://fortune.com/2015/06/26/sunrun-ipo-solar-silicon-valley/]. That doesn’t mean that every solar power company is thriving – as Peter Kelly-Detwiler points out in a recent Forbes article, the stock price of the leading solar developer SunEdison has fallen dramatically, leaving some unsure about the financial future of renewables – but the prospects are looking better should the industry weather the crisis.
So why would a sunny state like Nevada decide to limit and regulate such an abundant source of renewable energy? The most direct answer has to do with the interests of existing utilities companies, who want customers to keep buying from them and don’t want them to be able to sell excess energy back to the grid. But with operations in 14 states besides Nevada, the loss of business in the area isn’t likely to run Sunrun out of business for good.
Fehrenbacher, Katie. “What Sunrun’s IPO says about the solar industry and Silicon Valley.” June 26, 2015. http://fortune.com/2015/06/26/sunrun-ipo-solar-silicon-valley/
Kelly-Detwiler, Peter. “Sunrun’s $250 Million In Financing a Positive Sign for Distributed Solar.” Forbes. February 3, 2016. http://www.forbes.com/sites/peterdetwiler/2016/02/03/sunruns-250-million-in-financing-a-positive-sign-for-distributed-solar/#3332ac636cbc
Schiller, Ben. “Despite Setbacks, Sunrun’s CEO Knows Residential Solar Still Has a Bright Future.” Co.Exist. February 3, 2016. http://www.fastcoexist.com/3055983/despite-setbacks-sunruns-ceo-knows-residential-solar-still-has-a-bright-future