Solar stocks had an up and down week, but at the end of the day the industry trends are still getting stronger. Politically, solar is more acceptable than it was a year ago and the biggest, most ruthless banks in the world are seeing the value solar presents financially. Here are the biggest news items of the week from the solar industry.
Obama on energy
Renewable and solar energy has been on President Obama’s agenda since he took office, but with a financial crisis, floundering economy, and war in Afghanistan to worry about, there’s been little policy change. That’s why Tuesday’s speech about cutting carbon dioxide emissions and promoting renewable energy got so much attention from the solar industry. If President Obama is behind solar, it will get the political boost it needs.
As much attention as the speech got, I don’t actually think it’s all that important for investors. Solar installations grew 76% last year without much political help, and it’s unlikely that a carbon tax or cap and trade will pass Congress in the near future.
Instead, investors should be focusing on changes at the state level and the falling cost of solar in the residential and commercial markets. New York, New Jersey, and Minnesota are just three states that have introduced policies in the past year that will grow solar, and they’ll have more impact on the industry than what the president can get done right now.
Don’t get me wrong. Having the president of the United States on your side is a good thing, I just don’t think it fundamentally changes the investment case for solar.
Solar financing gets bigger
There were a couple of big announcements in solar financing this week. Sunrun said it has closed on $630 million worth of residential solar financing, backed by U.S. Bancorp (NYSE:USB) and JPMorgan Chase & Co. (NYSE:JPM). There’s been a rush to solar by big banks this year, and this is just the latest investment they’ve made. U.S. Bancorp (NYSE:USB) has been investing in residential solar for years, but this is the first such investment by JPMorgan Chase & Co. (NYSE:JPM), an important shift for the company.
Clean Power Finance also announced an equity investment from Duke Energy Corp (NYSE:DUK), one of the biggest coal plant owners in the country. This is the second equity investment from a major utility and another sign that traditional energy is trying to get into solar.