Solar Goes Corporate May 31 st , 2017 New York, New York Thank You - - PowerPoint PPT Presentation

Solar Goes Corporate

May 31st, 2017 New York, New York

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Thank You to Our Sponsors

1

Welcome

Abby Hopper President & CEO, SEIA

Master of Ceremonies

Mike Smith Vice President of Finance & Operations, SEIA

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The State of C&I Markets

Colin Smith Analyst, U.S. Utility Solar GTM Research

2016 Was a Banner Year for the U.S. Solar Market

Source: GTM Research

8 SEIA’s Solar Goes Corporate

2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Residential Non-Residential Utility

Market Drivers to Watch: Utility Solar’s Reboot Pegged to Non-RPS Demand

Source: GTM Research

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SEIA’s Solar Goes Corporate 1,803 2,855 3,922 4,266 10,760 8,114 6,480 7,895 9,215 9,6629,843 2,000 4,000 6,000 8,000 10,000 12,000 20122013201420152016201720182019202020212022 Utility PV Installations (MWdc) 37% 63% 37% 28% 21% 11% 3%

RPS Driven Non RPS Driven PURPA Voluntary Procurement Retail Procurement CCA

Utility PV in Development by State as

• f May 2017

May 31, 2017

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MT WY ID WA OR NV UT CA AZ ND SD NE CO NM TX OK KS AR LA MO IA MN WI IL IN KY TN MS AL GA FL SC NC VA WV OH MI NY PA MD DE NJ CT RI MA ME VT NH

MW in Development



0-20



20-100



100-500



> 500

2016 was a banner year for the U.S. solar market

Source: GTM Research

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$0 $25 $50 $75 $100 $125 $150 $175 $200 2008 2009 2010 2011 2012 2013 2014 2015 2016 PPA Price ($/MWh) PPA Contract Execution Date Combined Cycle Gas

Declines in Utility PV System Pricing

May 31, 2017

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$1.07 $0.95 $0.89 $0.86 $0.78 $0.75 $0.72 $0.70

$- $0.20 $0.40 $0.60 $0.80 $1.00 $1.20

H2 2016 H1 2017E H2 2017E 2018E 2019E 2020E 2021E 2022E

$/Wdc Module Inverter & Skid EBOS SBOS Labor Non-Labor Soft Costs

U.S. Utility Fixed-Tilt PV System Pricing H2 2016-2022E ($/Wdc)

A Case Study of Texas: Utility Solar’s Value Proposition in ERCOT

May 31, 2017

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Recent Utility PV PPA Prices’ as a % Premium or Discount to ERCOT West Price Outlook West Texas 20 Year PPAs Over Last 12 Months vs. ERCOT West Annual Energy Price Forecast

Min PPA Price $40.00 Max PPA Price $50.00 $0 $10 $20 $30 $40 $50 $60 $70 2017 2020 2023 2026 2029 2032 2035 $/MWh ERCOT West

• 60%
• 40%
• 20%

0% 20% 40% 60% 80% 100% 120% 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 % Delta of PPA Prices from ERCOT West 1st Half Half of

• f 20 Yea

Year PPA Ter Terms Fixed Price Hedge Against Wholesale Price 2nd nd Hal Half f of

• f 20 Yea

Year PPA A Ter Terms Cost Competitive Hedge

• r Discount to Wholesale

Power Pricing

Market Drivers to Watch: Utility Solar’s Reboot Pegged to Non-RPS Demand

Source: GTM Research

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SEIA’s Solar Goes Corporate

139 59 10 15 73 20 40 60 80 100 120 140 160 Ggiawatts (AC)

Current State of Offsite Solar PPA Market Corporate Offsite Renewables: Total Addressable Market

1.7 1.8

0.4 1.5 0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0 Q2-2017 Q2-2017 Gigawatts (AC)

In Development Operating

MW of Retail Procurement In Development or Operating

Source: GTM Research

15 SEIA’s Solar Goes Corporate

MT WY ID WA OR NV UT CA AZ ND SD NE CO NM TX OK KS AR LA MO IA MN WI IL IN KY TN MS AL GA FL SC NC VA WV OH MI NY PA MD DE NJ CT RI MA ME VT NH

MW in Development



0-20



20-100



100-500



> 500

2016 was a banner year for the U.S. solar market

Source: GTM Research

16 SEIA’s Solar Goes Corporate

MT WY ID WA OR NV UT CA AZ ND SD NE CO NM TX OK KS AR LA MO IA MN WI IL IN KY TN MS AL GA FL SC NC VA WV OH MI NY PA MD DE NJ CT RI MA ME VT NH

Non RPS Drivers



Green Tariff



ISO



CCAs

What Will Drive U.S. Corporate Offsite Procurement 2017-2022?

May 31, 2017

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• 1. Green Tariffs – Utilities will respond to customer demand for renewable procurement
• 2. Presence of ISO / RTO – The hedge contract OR contract for differences will become prevalent
• 3. California Community Choice Aggregators – CCAs will expand faster than direct access
• 4. Corporate political involvement – Companies will work with state utility commissions

The New Investor: Corporate Procurement as an Investment

Moderator Robert Sternthal President, CohnReznick Capital Melissa Peterson Director of Business Development, Apex Clean Energy Alvaro Pereira Director of Global Supply Advisory Services, EnerNOC Jason Spreyer SVP, Business Development Brookfield Renewables

Solar Goes Corporate

May 31st, 2017 New York, New York

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Thank You to Our Sponsors

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Opening the Commercial Real Estate Sector

Moderator Mike Mendelsohn Senior Director of Project Finance and Capital Markets, SEIA Laura Stern Co-founder and President, Nautilus Solar Energy Wayne Pfisterer President, Pfister Energy Yaniv Kalish CEO, SolarKal Kim Saylors-Laster EVP & Chief Procurement Officer, Black Bear Energy Inc.

SolarKal

Yaniv Kalish, CEO

SEIA’s Solar Goes Corporate May 31, 2017

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SolarKal | The Premier Solar Broker

Non-Fortune 500 Companies Are Lagging Behind

There are hundreds of solar companies in each market. SMBs lack education about mechanics, tax incentives & financing options of solar.

For Solar Companies, marketing & sales is time- consuming and inefficient. For Businesses, switching to solar is complex and confusing.

For a single lead, multiple companies conduct the same preliminary work. Installers have low conversion rates for proposals. 22

Small & Medium Businesses Are Not Adopting Solar

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Source: GTM Research

UNTAPPED GROWING FRAGMENTED

87 billion sq. ft in roof space 0.5% of roofs have solar

$1.2Tn in potential SMB market 2/3 of the market made up of 1,000s of regional installers

350 1,000 3,000 2010 2015 2020e

MW

Installation Capacity Expected to Triple in Next 5 years

The Shape of the Commercial Solar Market

SolarKal | The Premier Solar Broker

23 www.seia.org

Pfister Energy

Wayne Pfisterer, President

SEIA’s Solar Goes Corporate May 31, 2017

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Stacking technologies for optimal energy savings and ROI

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Stackable Technologies Roof System: Solar-ready PVC cool roof Renewable Energy: 775KW solar array Energy Efficiency: 72 daylighting units, LED lighting, daylight harvesting & occupancy sensing Total Savings: $1.75 million ROI: 4.1 years (21.2% IRR after tax)

www.pfisterenergy.com

Wayne Pfisterer

President, Pfister Energy, Inc. wpfister@pfisterenergy.com

(973) 653-9880 letsgo@pfisterenergy.com @PfisterEnergy

Changing the way energy is generated and delivered. ReTHINK ENERGY.

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Black Bear Energy

Kim Saylors-Laster, Executive Vice- President & Chief Procurement Officer

SEIA’s Solar Goes Corporate May 31, 2017

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BLACK BEAR ENERGY: FOCUS C & I CLIENTS 2.5B+ SQF 4 TECHNOLOGY VERTICALS

SOLAR ENERGY STORAGE LED FUEL CELL

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BLACK BEAR ENERGY: OWNER/USER REPRESENTATION

STEP 1 - SCOPE

• Identify goals
• Screen portfolio for target assets
• Present short list for selection

STEP 2 - DEVELOP

• Refine standard contracts (lease, PPA, etc.)
• Conduct initial technical screening
• Define key property parameters

STEP 3 - PROCURE

• Conduct competitive RFP
• Normalize, evaluate and present bids
• Finalize contracts with selected supplier(s)

STEP 4 – IMPLEMENT

• Develop/coordinate construction timeline
• Confirm design and construction standards
• Oversee construction process

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CONFIDENTIAL

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How Do Commercial & Industrial Buyers See Solar Energy in the Larger Context of their Energy Procurement Strategies?

Moderator Abigail Hopper President & CEO, SEIA Kathryn Wiseman Director, Global Public Policy, Walmart

Ali Rotatori Associate, Business Renewables Center, Rocky Mountain Institute

Holly Lahd Lead Energy Program Manager, Target Chelsea Mozen Senior Manager, Energy + Carbon, Etsy

Solar Goes Corporate

May 31st, 2017 New York, New York

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Thank You to Our Sponsors

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Quick Talk: Why New FERC Rules on Energy Storage Will Expand Options for Corporate procurement of Renewable Resources

Mark Perlis Of Counsel, Covington & Burling LLP

• Today: Revenue Streams are Behind the Meter, i.e., Retail
• Increase Self-Consumption
• Backup Power Source, Displacing Utility Supply
• Reduce Utility Demand Charges
• Future: Easier Aggregation of Distributed Energy Resources and

Easier Access to FERC Jurisdictional Markets

• Expanded Opportunities for “Stacked” Revenue Streams

Storage Coupled with Solar

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Rocky Mountain Institute, The Economics of Battery Energy Storage, Oct. 2015

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• Purpose: Remove Barriers to Participation of Storage and DERs

in FERC-Jurisdictional, ISO-Administered Wholesale Markets

• Proposal: ISOs To Adopt New Participation Models that Recognize

Physical and Operational Characteristics of Storage

• Proposal: Participate as Wholesale Buyer and Seller
• Proposal: Storage May Provide Transmission Services at Cost-Based

Rates and Sell Energy at Market-Based Rates

• Proposal: Aggregation of DERs Given Access to Wholesale Electric

Markets

FERC Rulemakings on Storage and Distributed Energy Resources (DERs)

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• Today: three main types of renewables procurement
• On-site solar, but may be too small to meet entire load
• Purchase unbundled RECs, but may not be “additional”
• Power purchase agreements with new renewable project--

long-term purchase; output of facility is sold in wholesale market; retail load served by local utility; bundled RECs from renewable facility cover retail consumption; financial contracts used to manage risk of wholesale markets.

• Future: Solar + Storage as DERs better match renewables output

and fluctuating corporate load and optimize revenue streams.

Corporate Procurement Opportunities for Solar + Storage

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• Solar + Storage DERs introduce a new counterparty, at intersection of

retail and wholesale markets.

• DERs enable aggregation, economies of scale and intermediation
• Storage enables longer and smoother matching of load and supply,

better management of self-consumption and excess supply

• Solar + Storage DERs enable more flexible arbitrage of retail and

wholesale markets; temporal arbitrage; congestion management

• Intermediation between consumers who want green energy and those

who do not require it

Future Corporate Procurement Opportunities for Solar + Storage DERs

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Emerging Commercial and Industrial Demand for Community Solar: Trends and Tools in the Corporate Procurement Race

Moderator Sara Bergan Attorney, Stoel Rives Seth Ginsberg Managing Partner, Apis Energy Group Rob Pantano, CFO & COO, Nexamp George Hershman Senior Vice President, General Manager, Swinerton Chris Diaz Principal, Seminole Financial Services, LLC Mike Malone Senior Vice President, Clean Energy Collective

https://events.bizzabo. com/SGCNYC/polls/057 89/wall

Trends and Perspectives on Offsite Renewable C&I Procurement

Moderator Richard Walsh Program Lead, Clean Energy Solutions, WGL Energy Susan Kolodziejczyk Senior Manager of Sustainability, National Geographic Erin Craig Vice President, 3Degrees Group, Inc. Colin Murchie Senior Director, Customer Energy Services, Sol Systems David Touhey President of Venues, Monumental Sports & Entertainment

Community solar + virtual net metering

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• Utility-managed
• Growth is capped
• Policy dependent
• Nuanced Rules
• Size and subscriber

limitations

• Geographic limitations

Utility Green Tariffs

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Virtual PPAs for everything else

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Source: RMI.org

Range of offsite renewable energy structures

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Community Solar Virtual Net Metering Virtual PPA Utility Green Tariff

Everything in between

Solar Goes Corporate

May 31st, 2017 New York, New York

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Thank You to Our Sponsors

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Corporate Tax Equity: The New Key to Financing Solar?

Moderator Sue Wang Associate, Chadbourne & Parke LLP Jonathan Silver Managing Director, Tax Equity Advisors Jon Powers Co Founder, CleanCapital Nick Knapp Managing Director, CohnReznick Capital

Regional Considerations: What Drives C&I Demand on the East Coast?

Moderator Dave Gahl Director of State Affairs, Northeast, SEIA Scott Wiater President & CEO, Standard Solar Matthew Meares Principal, Virginia Solar LLC Erik Paulson VP of Wholesale Services, Customized Energy Solutions, LTD Peyton Boswell Managing Director, EnterSolar

https://events.bizzabo.com/SG CNYC/polls/05790/wall

Solar Goes Corporate

May 31st, 2017 New York, New York

www.seia.org

Thank You to Our Sponsors

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