The US presidential election is over and half the country feels like a big black swan swooped down and left a very big and impolite reminder of its passage.

Black swan events are unexpected and have a traumatic effect on economies, governments, industries and people. Once the black swan departs the details of the surprise it represents are unpicked and everyone offers reasons why the event occurred. Remember derivatives and the housing crisis that took down the global economy, destroyed livelihoods, lives and damaged the global solar industry? Systems had been set up to create a landscape perfect for a black swan to swoop down and, well, leave an ugly reminder of its passage. People may have been shocked to find piles of unsecured debt underlying the global economy, but the signs were always there.

In 2016 Brexit seemed like a black swan event to those in the United Kingdom. In Venezuela the vote against the peace accord ending a 50 year seemed like a black swan event. In the US an undisciplined, angry, billionaire business man who insulted all his competitors was elected president.

In 2016 all around the world people have been voting their anger over the status quo, politics, immigration, and their economic prospects among other things. Amid the celebrations and wakes surrounding these momentous elections one thing seems clear – the signs of all these decisions were out in the open and should not have surprised anyone.

Polling Problems

During the US republican primary Mr. Trump behaved brashly, used his twitter account freely and insulted competitors and anyone seeming to disagree with him, and yet he kept winning primaries. Media pundits discussed this as a phenomenon and the polls continued to show him losing the primary. He won the Republican primary.

Following the Republican primary media pundits talked over what went wrong with the polls and the pollsters cried mea culpa and promised to do better.

During the general election most polls showed Mr. Trump behind – often well behind — Secretary Clinton. Throughout the election season Mr. Trump continued insulting his opponent and anyone who disagreed with him while tweeting his way through the early morning hours.

He also drew crowds to his rallies and he won the election.

Half of the US electorate and all of the media fell into deep shock. Unhappy voters began wondering if a move to Canada was possible. People wandered the streets muttering “how could this happen?” The media pondered what they missed and the pollsters cried mea culpa and promised to do better.

The US media as well as half the country missed what was directly and clearly in front of them the same deep, disenfranchised rage that was missed in the UK, in Venezuela and in many other voting countries during this year of voting angrily. It was obvious. It was seen. It was disregarded.

The pollsters, well, they failed to do their job correctly. Polling is a subset of market research that is, it is a research discipline. The researcher:

  • Establishes the population to be studied, including its size, and makes an assessment as to the sample size that would appropriately represent the whole population
  • Develops a survey instrument – even the simplest survey instrument has to be carefully crafted
  • Tests the survey instrument
  • Corrects the survey instrument
  • Gathers the data
  • Tests the data for validity
  • If necessary, a larger sample size is gathered

The researcher also understands that all surveys have bias. End user surveys, essentially polling, are highly vulnerable to bias. First, respondents often lie. Second, the analyst (or pollster) may have a bias for a certain result and may make assumptions that would force the poll in a certain direction.

The point of any market research is to set the experiment up so that the possibility of result altering bias is reduced.

In the case of the 2016 US presidential election incorrect polling during the Republican primary should have rung a really big bias warning bell and the pollsters should have course corrected. Doing so may not have changed a thing but it would have lessened the shock on Election Day.

Aftermath of the US election

The US election will have an effect on US climate policy potentially swaying it much more towards conventional energy including fracking for natural gas and oil and away from deployment of renewables and incentives towards this end. The Clean Power Plan as established will not survive and states will start pulling back plans – not all states, but many of them. After election concerns pertinent to the solar industry include:

  • The Three Branches of Government: The Republican Party now controls the Executive, Judicial and Legislative branches of government this means it controls the agenda followed by the country for at least two years until the midterm elections and potentially for decades because of the Supreme Court.
  • The Supreme Court: The next justice will set the tone for the country on wide ranging cases including the Clean Power Plan.
  • The Clean Power Plan: President Elect Trump has vowed to turn back all reforms and likely will – and – cases reaching the Supreme Court may not fare well.
  • The DoE and NREL: The new president will select the energy secretary who will set the direction, tone and budget at the DoE. Funding for solar and all renewable energy generating technologies is at risk. Mr. Trump has chosen Republican Ken Blackwell to head the transition team for the DoE. Mr. Blackwell has lobbied on the behalf of Koch Companies, Southern Company and Dow Chemical among others.
  • The ITC: Though this is a bipartisan agreement and a law, it can be overturned by an act of congress. Best case, it continues as planned. Worst case it is overturned by the new president and congress. However, the odds of the ITC being overturned are low. Very low. Not worth betting on. Again, the ITC is a law and it was bipartisan.
  • The EPA: President Nixon, a republican, established the EPA so it is not a foregone conclusion that its powers will be decreased. However, the president appoints its administrator and President Elect Trump has chosen Myron Ebell, a climate change skeptic to lead the EPA transition team.
  • The Paris Climate Change Agreement: President Elect Trump has made it clear that he plans to exit the agreement and he is likely to do so.

The US Market Going Forward

Just a few pre-election weeks ago the US was a stable market, at least for the commercial application. The commercial application includes utility scale, small to mid-market DG solar deployment and large wholesale DG deployment. The US presidential election inserted instability and shifted the focus back to oil, gas and coal A hiccup in the US market for solar deployment would affect business plans and forecasts for all participants and observers – globally – because the market for solar components and systems is global.

The focus on solar deployment in the US going forward is likely to be driven by the states and the ITC. Once it becomes clear that the ITC is not vulnerable stability should return to the US market for solar deployment.