Neil McAndrews and Larry Lawrence, Enterprise Risk Consulting, LLC
Austin, Texas
Solar is like a Tsunami and it is coming to a utility near you. Many folks still characterize the solar industry as a niche industry; that it is simply a West Coast thing or a Green thing. That it can’t hope to compete with conventional power. All of these prevailing public perceptions are about to be challenged because the assumptions are no longer true.
The reasons are manifold, but it comes down to price and performance. We at Enterprise Risk Consulting have had years of experience in the conventional power industry. Nothing in the last 50 years compares with the market changes we are now experiencing. Solar competes against all other forms of energy, and in many cases, wins by a large margin. It all depends on the quality of installation, the solar irradiance, the regulatory jurisdiction and whether it is utility scale or distributed scale.
A Tsunami sweeps all before it and solar is the mother of all waves. The wave started in California with large subsidies and grandiose targets related to the “California Solar Initiative” in 2007. Rapid technology improvements and industry installation standardization have dramatically reduced costs. PV module costs plummeted in 2011-2014. This built the wave from a regional swell to a gigantic disruptive technology.
The California Solar Initiative program is now fully subscribed and has surpassed all of its targets - ahead of schedule. The program also produced by-products in the form of billion dollar businesses like SolarCity and Vivint - new companies with economies of scale for installation and inventive new financing and ownership plans.
We have witnessed great marketing moments in the past. The introduction of iconic products that define an era: the Ford Mustang, the IBM Selectric, the PC, the cell phone, the Ipod, and smart phones. These have spun off huge ancillary businesses. iTunes to feed the Ipod for example. California innovation in solar is next, and is now being marketed to the rest of the country and the world.
Because of the drop in the cost of the underlying technology, large installations are now commonplace. Enterprise Risk Consulting has already helped establish power cost leadership for new power supplies covering entire Texas cities using predominantly wind and solar resources. That is how we know that the Tsunami is here in Texas. Not because we forecast it, but because it has already crashed on Texas shores. Texas is scheduled to grow its solar installations by more than 1000% between 2015 and 2016. Other states are next.
Renewables are not the same supply risk we dealt with in the past. Managing renewable resources is not for the faint of heart, or the uninitiated. We urge you to surf the wave, or at least seek higher ground and avoid being washed away. We have learned many useful procedures to select renewable resources and to integrate them into a power supply portfolio. Many of the portfolio optimization techniques are relatively well established and we are using them to successfully manage renewable intermittent resources.
© Copyright 2015 Enterprise Risk Consulting, LLC
Austin, Texas
Solar is like a Tsunami and it is coming to a utility near you. Many folks still characterize the solar industry as a niche industry; that it is simply a West Coast thing or a Green thing. That it can’t hope to compete with conventional power. All of these prevailing public perceptions are about to be challenged because the assumptions are no longer true.
The reasons are manifold, but it comes down to price and performance. We at Enterprise Risk Consulting have had years of experience in the conventional power industry. Nothing in the last 50 years compares with the market changes we are now experiencing. Solar competes against all other forms of energy, and in many cases, wins by a large margin. It all depends on the quality of installation, the solar irradiance, the regulatory jurisdiction and whether it is utility scale or distributed scale.
A Tsunami sweeps all before it and solar is the mother of all waves. The wave started in California with large subsidies and grandiose targets related to the “California Solar Initiative” in 2007. Rapid technology improvements and industry installation standardization have dramatically reduced costs. PV module costs plummeted in 2011-2014. This built the wave from a regional swell to a gigantic disruptive technology.
The California Solar Initiative program is now fully subscribed and has surpassed all of its targets - ahead of schedule. The program also produced by-products in the form of billion dollar businesses like SolarCity and Vivint - new companies with economies of scale for installation and inventive new financing and ownership plans.
We have witnessed great marketing moments in the past. The introduction of iconic products that define an era: the Ford Mustang, the IBM Selectric, the PC, the cell phone, the Ipod, and smart phones. These have spun off huge ancillary businesses. iTunes to feed the Ipod for example. California innovation in solar is next, and is now being marketed to the rest of the country and the world.
Because of the drop in the cost of the underlying technology, large installations are now commonplace. Enterprise Risk Consulting has already helped establish power cost leadership for new power supplies covering entire Texas cities using predominantly wind and solar resources. That is how we know that the Tsunami is here in Texas. Not because we forecast it, but because it has already crashed on Texas shores. Texas is scheduled to grow its solar installations by more than 1000% between 2015 and 2016. Other states are next.
Renewables are not the same supply risk we dealt with in the past. Managing renewable resources is not for the faint of heart, or the uninitiated. We urge you to surf the wave, or at least seek higher ground and avoid being washed away. We have learned many useful procedures to select renewable resources and to integrate them into a power supply portfolio. Many of the portfolio optimization techniques are relatively well established and we are using them to successfully manage renewable intermittent resources.
© Copyright 2015 Enterprise Risk Consulting, LLC
RSS Feed
