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As the Price of Oil Soars, Many Turn to Renewables
Thomas Rainwater of SunEdison, with solar panels for Kohl's in Laguna Niguel, Calif. Rainwater spent 25 years in traditional energy work before moving to SunEdison.
(Sunedison)
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"Plug-in hybrids are the utilities' best friend and worst enemy," Lewis said. He thinks they will force changes. With more sophisticated control equipment and dedicated car-recharging outlets, a utility could make sure the cars recharge only at night when there's spare electricity.
[an error occurred while processing this directive]So far, though, GridPoint is mostly a product in search of a market. GridPoint has eight trials in progress with utilities; there are five to 10 units being used in each trial. If all goes well, it will move to pilot projects that could involve thousands of units within a year.
SunEdison, by comparison, isn't coming up with new ideas. Instead it has a financing model that makes it easier to sell the existing technologies of major solar manufacturers.
Because solar panels are unfamiliar devices, and because they're expensive with relatively long payback periods, many individuals and companies don't consider buying them. So SunEdison doesn't sell solar panels. It buys them and puts them on the rooftops of big retail stores or warehouses. The customers then sign 20-year contracts to pay SunEdison for the power the panels generate. SunEdison continues to own the panels and maintain them.
"Solar is virtually maintenance free, but not [completely] maintenance free," said Jigar Shah, founder and chief strategy officer of SunEdison. He said that while many utilities in San Diego and Los Angeles lost power lines in the recent fires, SunEdison's panels worked 91 percent of the time. After the fires died down, though, SunEdison sent its workers to check and clean the panels.
In September, Kohl's department stores turned on the first of 63 solar systems it plans to install with SunEdison on its California stores. Together the stores will eventually generate 25 megawatts of electricity -- the equivalent of electricity used by 3,087 California homes. Other SunEdison customers include the federal government, Wal-Mart, Staples, Whole Foods, the City of San Diego, the California State University system and Caltrans.
Shah, 33, won the backing of Goldman Sachs for a $60 million fund to buy and deploy the panels. Goldman also shares the tax benefits the federal government gives solar installations. SunEdison just lined up another $250 million fund with support from Wells Fargo and HSH Nordbank.
Shah said that regulatory and tax policies in New Jersey and California have made those states the company's biggest markets. But he said that new state initiatives in Maryland and Delaware should spark more sales, and hiring, in this region.
Rainwater said that utilities are starting to realize that solar installations of this size are competitive economic ideas.
"We know people don't like coal," he said. "No matter what we do to call it clean, it's not; it's coal. This notion of clean coal technology is at least a decade out. And yet there's an almost insatiable appetite for energy."
