Written in 2016 for The Solar Flare and still true in 2018

Historically, participation in the global solar industry has been subject to volatility from one end of the value chain to the other. Jobs have been lost and are not always regained. Money has been lost, businesses have failed. Dreams have come true and have been shattered.

Solar is an addictive industry in good and bad ways. Floating overhead is the chance – again, at every point in the value chain – to change the world, to be part of something bigger than oneself and to potentially profit from doing so. Think about it, a person could actually make a living being part of the solution to the climate change crisis.
Often, it is not an easy living.  High hopes and optimism float uneasily on top of volatility creating an environment where:

  • Observers make a living or garner attention for announcing big deployment numbers at cheap prices while oversimplifying and ignoring pesky and unpleasant details
  • Governments offer generous incentives without properly considering what measures can be undertaken if the market accelerates and whether any control measures will actually result in controlling an out-of-control market
  • Governments enact tariffs or price floors (minimum price levels) to counteract what they perceive as dumping seemingly without realizing that an entirely new grey market may spring up as a result
  • The price function and the true cost of manufacturing PV cells and modules is poorly understood while the lowest price, which may be a grey market price, a black market price or an inventory price is celebrated as the global average
  • Downward price pressure often forces manufacturers into the uncomfortable position of choosing quality over margin or unfortunately, margin over quality
  • The solar roller coaster is celebrated while ignoring those who broke their necks or hearts on the ride
  • Low margins for developers and manufacturers are ignored while low bids and prices for components are celebrated as proof of the solar industries competitiveness with fossil fuels
  • Business models with obvious flaws such as the residential solar lease are lauded while also scorned while losses pile up and the negligible value to customers is left more or less unexplored.
  • Companies such as SunEdison announce new products and ventures often expanding in too many directions often far from their true core competencies. Example: SunEdison announced an expansion into off grid micro-grid deployment at the 2015 Solar Power International mere months before it failed. The vision of SunEdison’s Frontier Power was energy, connectivity and water, viewed through the lens of an off grid utility where SunEdison owned the assets. Now SunEdison’s creditors own its assets.

The Point

Though the global solar industry has been historically volatile it does not have to continue in this vein.  A new path would require participants and stakeholders to choose slower more careful growth based on sustainable margins and value to customers.


Less volatility and sustainable growth means … slowing down, taking a breath and bypassing business that in the end serves no one well.