WEBVTT - Solar Shines Bright in the Energy Crisis 0:00:00.160 --> 0:00:03.400 Hi, you're listening to Switch It on the b F podcast, 0:00:03.920 --> 0:00:07.040 and today is all about solar. I sit down with 0:00:07.120 --> 0:00:10.000 Jenny Chase, who is the head of Solar Research and 0:00:10.200 --> 0:00:12.400 she has actually been an analyst at B and E 0:00:12.440 --> 0:00:15.720 F covering solar since the very beginning. We're going to 0:00:15.840 --> 0:00:19.480 talk about what's going on in two with prices which 0:00:19.560 --> 0:00:24.000 continue to rise for most components, materials and projects across 0:00:24.000 --> 0:00:26.799 the industry, but at the same time there continues to 0:00:26.840 --> 0:00:30.600 be strong demand and two is also likely to be 0:00:30.640 --> 0:00:33.959 a year of record build in Europe, in China as 0:00:34.000 --> 0:00:37.120 well as a few newer markets where high energy prices 0:00:37.159 --> 0:00:40.440 are driving adoption. So let's speak with Jenny about the 0:00:40.479 --> 0:00:44.839 solar quotable take market outlook and what she's observing across 0:00:44.880 --> 0:00:54.160 the industry. Hi, Jenny, thank you for joining. Hello Diana, 0:00:54.200 --> 0:00:57.240 Hello everyone. Well you're back here today, and I don't 0:00:57.240 --> 0:00:59.160 think I asked this question last time, so I'm gonna 0:00:59.200 --> 0:01:01.640 ask it as the first question as we start today, 0:01:01.840 --> 0:01:04.640 which is how long is it that you've been covering 0:01:04.800 --> 0:01:08.880 the solar industry. It's been seventeen years, okay, so you've 0:01:08.920 --> 0:01:10.400 got a good amount of time under your belt in 0:01:10.400 --> 0:01:12.560 a good amount of perspective on some of the highs 0:01:12.560 --> 0:01:14.840 and lows. And so I'm actually going to quote you 0:01:15.240 --> 0:01:18.000 back to yourself as we start this show today. So 0:01:18.280 --> 0:01:21.000 I took a look at the PV market outlook you 0:01:21.040 --> 0:01:23.039 that you did for the third four two, you and 0:01:23.040 --> 0:01:25.600 your team, and you say in this report that and 0:01:25.720 --> 0:01:28.640 they quote the future of solar is more uncertain than 0:01:28.680 --> 0:01:32.040 ever and even in the present, the picture is one 0:01:32.200 --> 0:01:36.000 of blurry but frantic growth. So I want to know 0:01:36.560 --> 0:01:39.200 what do you mean by this? Oh, dear, Yeah, it 0:01:39.200 --> 0:01:41.920 sounds very pretentious when you put it like that. I 0:01:41.920 --> 0:01:45.199 mean I started covering this industry when there was about 0:01:45.280 --> 0:01:48.960 a gigawatts maybe two giga exactly being installed every year, 0:01:49.120 --> 0:01:50.600 and this year we think there were two hundred and 0:01:50.640 --> 0:01:54.000 fifty one gigawatts being built. And as it's scaled up, 0:01:54.040 --> 0:01:57.320 the number of countries during solar has expanded massively. So 0:01:57.320 --> 0:02:00.360 there's there's now about a hundred and forty five currents 0:02:00.480 --> 0:02:03.200 that we had to maintaining current statistics and forecast for, 0:02:03.600 --> 0:02:08.320 and solar statistics are really hard. Dana countries very seldom 0:02:08.400 --> 0:02:12.359 produced timely information on how much older was being installed. 0:02:12.400 --> 0:02:13.840 A lot of the time they don't even collect this 0:02:13.880 --> 0:02:16.720 information if the solar is not grid connected, and so 0:02:16.919 --> 0:02:19.239 all the data we have on build of solar is 0:02:19.280 --> 0:02:22.160 quite backward looking, you know, at least six months backward looking, 0:02:22.480 --> 0:02:26.200 except for Chinese exports, and China is exporting loads of 0:02:26.240 --> 0:02:29.280 solar this year. We've got exports up up to July 0:02:29.600 --> 0:02:32.920 and they're really high. Europe has about fifty three giggs 0:02:32.960 --> 0:02:36.080 what's left China for Europe up to July, and we 0:02:36.080 --> 0:02:39.160 were expecting the whole European market to be about this year. 0:02:39.200 --> 0:02:41.120 So there's a whole load of models in Europe that 0:02:41.160 --> 0:02:44.000 haven't been installed yet, and sometimes it's just really hard 0:02:44.040 --> 0:02:46.680 to figure out what's going on. So the statistics are 0:02:46.760 --> 0:02:49.400 largely unreliable. And as a result, how did that impact 0:02:49.400 --> 0:02:52.640 your forecast? We put a big buffer in because we 0:02:52.680 --> 0:02:54.919 know the modules are going somewhere, and we've got this 0:02:55.120 --> 0:02:58.040 lock called the buffer where if none of our regional 0:02:58.080 --> 0:03:00.560 analysts identify where the modules are going, will leave a 0:03:00.600 --> 0:03:03.200 little bit of headway because we know they're probably wrong, 0:03:03.280 --> 0:03:05.079 and at least some of them will find all those 0:03:05.120 --> 0:03:08.760 modules in their geographies and be shocked. So I think, 0:03:08.800 --> 0:03:11.240 then let's talk about what's driving the higher costs. And 0:03:11.280 --> 0:03:14.080 I know that inflation is this word that everybody is 0:03:14.400 --> 0:03:16.720 mixing into pretty much every conversation right now, and I'm 0:03:16.760 --> 0:03:18.320 guessing by the time we get to the end of 0:03:18.320 --> 0:03:20.520 the year, it will be one of those words whereveryone's 0:03:20.560 --> 0:03:23.520 just exhausted by it. But if we're thinking about what's 0:03:23.560 --> 0:03:27.720 happening to solar modules, which have largely seen a decrease 0:03:27.760 --> 0:03:32.040 in prices for various reasons associated with the different components, 0:03:32.400 --> 0:03:36.480 what's causing maybe a short term increase in module prices 0:03:36.480 --> 0:03:39.120 in the near term. So sol is a bit unusual 0:03:39.320 --> 0:03:42.360 in the whole inflation baskets, and that we do expect 0:03:42.360 --> 0:03:45.560 it to reverse quite drastically. Because you did say that, yeah, 0:03:45.560 --> 0:03:47.360 you're saying that you think things are going to come 0:03:47.360 --> 0:03:50.680 down by the end of three. I think solar module 0:03:50.680 --> 0:03:53.560 prices are going to drop, probably start dropping by the 0:03:53.600 --> 0:03:57.000 end of twenty two, because, first of all, solo modules 0:03:57.040 --> 0:03:59.600 today cost about twenty six cents or what they were 0:03:59.600 --> 0:04:03.880 at lower nineteen. So there's this very unusual situation where 0:04:04.080 --> 0:04:06.800 even in nominal terms, they're higher than they used to be. 0:04:06.880 --> 0:04:09.400 In real terms, it's actually about flat, but in nominal 0:04:09.480 --> 0:04:11.440 terms they're more expensive than they used to be, and 0:04:11.480 --> 0:04:14.360 that's not a common situation in solar. The prices have 0:04:14.400 --> 0:04:18.080 been dropping for thirty years, pretty rapidly and pretty steadily. However, 0:04:18.160 --> 0:04:20.480 what's holding them up right now is a shortage of 0:04:20.480 --> 0:04:24.279 polystylican Policylican factories are big and expensive and take time 0:04:24.279 --> 0:04:27.440 to set up, and very simply global demand for solar 0:04:27.600 --> 0:04:31.080 modules has driven demand for solo polysilicon to be well 0:04:31.120 --> 0:04:33.640 ahead of how much is being produced. However, there's a 0:04:33.640 --> 0:04:36.240 whole bunch of factories coming online in China to make 0:04:36.240 --> 0:04:39.279 more polysilicon, and we also think there's probably some inventory 0:04:39.279 --> 0:04:42.320 build up of modules around the world. So we're expecting 0:04:42.360 --> 0:04:45.760 the crisis to drop back towards about twenty two cents 0:04:45.800 --> 0:04:49.840 from the current cents. Okay, so prices are coming down. 0:04:49.960 --> 0:04:52.160 Prices are not coming down yet. To be fair, the 0:04:52.200 --> 0:04:54.719 prices of modules could stay high for a long time, 0:04:54.720 --> 0:04:57.320 but that would mean an awful lot gets built next year, 0:04:57.360 --> 0:04:59.120 because the only thing that I can see would drive 0:04:59.160 --> 0:05:01.760 prices just I high all of next year would be 0:05:01.839 --> 0:05:05.720 if we build more solar next year, which I don't 0:05:05.800 --> 0:05:09.240 think we can. There were bottlenecks in installation labor in 0:05:09.520 --> 0:05:12.760 what sites are ready to get permitted to get permission 0:05:12.960 --> 0:05:15.440 to build solder on and connect to the grid. And 0:05:15.480 --> 0:05:18.120 there are also shortages of other components like inverters that 0:05:18.160 --> 0:05:21.320 help things up well. And so let's talk about solar 0:05:21.360 --> 0:05:24.359 industry growth because that's definitely something that a lot of 0:05:24.360 --> 0:05:26.440 people are thinking about right now in terms of high 0:05:26.520 --> 0:05:29.360 energy prices and you know, potentially countries looking at more 0:05:29.640 --> 0:05:33.039 domestically produced energy. And I do understand, and I know 0:05:33.120 --> 0:05:36.680 that listeners understand that natural gas and the volatility that 0:05:36.720 --> 0:05:39.800 we're seeing on prices over there, and how important flexible 0:05:40.120 --> 0:05:43.400 capacity is to the solar industry. It's definitely one of 0:05:43.440 --> 0:05:45.440 the pieces to the puzzle that you have to see 0:05:45.640 --> 0:05:48.719 in the big picture when you're thinking about solar. But 0:05:48.960 --> 0:05:52.440 largely do you see growth in this industry and roll 0:05:52.480 --> 0:05:55.520 out and if so where kind of in response to 0:05:55.960 --> 0:05:59.000 high energy prices? Absolutely. So. One of the biggest and 0:05:59.080 --> 0:06:02.839 also most difficult the track sectors is rooftop solar in Europe, 0:06:03.080 --> 0:06:06.520 so solar being built by house owners and business owners 0:06:06.800 --> 0:06:08.960 literally just to feed into the building that they're on 0:06:09.120 --> 0:06:12.159 and sometimes to feed into the grid if it's allowed. 0:06:12.440 --> 0:06:13.960 So this is one of the said ones where the 0:06:14.040 --> 0:06:16.520 data is poor nuts, but we're pretty sure from talking 0:06:16.520 --> 0:06:20.159 to installers and a third party finance companies and other 0:06:20.200 --> 0:06:23.720 sources that this is going gangbusters installers in Germany, so 0:06:23.760 --> 0:06:26.600 that they're sold out until next well into next year, 0:06:26.839 --> 0:06:29.800 simply because people are freaking out about their energy costs. 0:06:30.080 --> 0:06:32.000 And one of the ways you can deal with that 0:06:32.240 --> 0:06:33.960 is by putting a solo on your roof and buying 0:06:34.040 --> 0:06:38.160 less elepricity, which is something because Germany were early adopters 0:06:38.440 --> 0:06:41.040 with solar. I mean, they had a boom a decade 0:06:41.040 --> 0:06:43.200 and a half ago. Germany has a lot of solo, 0:06:43.279 --> 0:06:45.080 but it's still got some roofs that don't have solo 0:06:45.160 --> 0:06:48.280 on it, so I guess they're getting it now, better 0:06:48.400 --> 0:06:52.320 late than never. So solar could potentially help alleviate some 0:06:52.480 --> 0:06:55.960 of this volatility. And you mentioned Germany, you also have 0:06:56.040 --> 0:06:58.600 other parts of the world, so let's say, namely China, 0:06:58.920 --> 0:07:01.320 and you know in year, which even received a large 0:07:01.400 --> 0:07:04.839 number of panels earlier this year, do you still see 0:07:04.960 --> 0:07:09.080 build out of solar in Asia to the a booming 0:07:09.160 --> 0:07:12.200 space in the future. Oh, definitely. So of the two 0:07:12.880 --> 0:07:17.880 one gigawatts expect to be installed this year, about gigawats 0:07:17.920 --> 0:07:22.200 of that is in China. China has also got high 0:07:22.280 --> 0:07:25.760 energy prices, and it's also building large amounts of rooftop solar, 0:07:26.240 --> 0:07:28.920 plus some of the mega energy bases being planned in 0:07:28.920 --> 0:07:32.600 the desert under construction, and that's that's taking up a 0:07:32.640 --> 0:07:35.400 lot of a lot of solar modules. India is a 0:07:35.440 --> 0:07:38.400 little bit different because although the Indian market is much 0:07:38.440 --> 0:07:41.560 stronger this year than last year, the big reason there 0:07:41.640 --> 0:07:44.960 was a massive import boom in India is at import 0:07:45.000 --> 0:07:48.040 tariff coming in April, which meant that anyone planning to 0:07:48.080 --> 0:07:51.320 build solar in India brought their modules before April. So 0:07:51.360 --> 0:07:53.600 potentially this is going to drop off. Now, India is 0:07:53.640 --> 0:07:56.040 one of the countries that still has a pretty high 0:07:56.080 --> 0:07:59.320 dependence on what we would consider high carbon fuels, So 0:07:59.520 --> 0:08:03.480 cool is you know, still definitely thriving in India. Do 0:08:03.520 --> 0:08:06.480 you see solar you know you mentioned it kind of 0:08:06.600 --> 0:08:09.240 dropped off because of a change in policy. Do you 0:08:09.320 --> 0:08:11.880 see it just because of the low l c ELI 0:08:12.440 --> 0:08:16.120 being of interest in that geography going forward or is 0:08:16.160 --> 0:08:19.720 it going to cool? Absolutely, India will keep building solar. 0:08:19.840 --> 0:08:22.320 It takes a while for solar to really start digging 0:08:22.320 --> 0:08:25.800 into cold margins just because type changing any system takes 0:08:25.800 --> 0:08:29.680 a while. But India the Indian solar market is unlikely 0:08:29.760 --> 0:08:32.720 to cool. There are companies setting up manufacturing in India 0:08:32.760 --> 0:08:35.960 and there was a government incentive to do so, and probably, 0:08:36.040 --> 0:08:38.320 to be honest, even with a fully percent imports habiff, 0:08:38.679 --> 0:08:42.000 it's still likely to be worse buying some modules for 0:08:42.080 --> 0:08:45.760 rooftop use and they will continually big auctions that build 0:08:45.880 --> 0:08:49.160 big projects on open land in India. The future of 0:08:49.200 --> 0:08:52.360 solo in India is bright despite the import tariffs. That's 0:08:52.400 --> 0:08:54.760 a great pun too. I like all solar things being right, 0:08:54.800 --> 0:08:57.360 I love it boom, you know. And actually we're going 0:08:57.360 --> 0:08:59.320 to continue our trip around the world and one of 0:08:59.320 --> 0:09:01.280 the other continent that I actually want to talk about 0:09:01.520 --> 0:09:04.200 is Africa, and specifically in the run up to CAP 0:09:04.240 --> 0:09:07.360 twenty seven, which is taking place in November, there's a 0:09:07.360 --> 0:09:11.400 lot of discussion around alleviating energy poverty and the role 0:09:11.400 --> 0:09:14.560 that renewables could actually play in some parts of the world, 0:09:14.760 --> 0:09:17.720 and Africa definitely being one of them. Given that CAP 0:09:17.880 --> 0:09:20.520 twenty seven is being hosted in Egypt, there's just a 0:09:20.559 --> 0:09:23.720 lot of eyes on what renewable energy could look like 0:09:23.920 --> 0:09:26.520 on that continent. How do you think solar is going 0:09:26.559 --> 0:09:29.760 to play a role in Africa's energy future. In the 0:09:29.800 --> 0:09:33.040 long term, it will play a huge role. It should 0:09:33.120 --> 0:09:36.280 be possible for many, many countries to leap flo over ever, 0:09:36.360 --> 0:09:38.640 going through the coal and gas plant stage and go 0:09:38.800 --> 0:09:42.120 straight to fairly distributed energy networks that are pallered largely 0:09:42.120 --> 0:09:45.560 on renewables with battery backup. In the short term, things 0:09:45.559 --> 0:09:47.439 are not quite so bright. A lot of the large 0:09:47.440 --> 0:09:52.760 projects being built in Africa had power signed in and before, 0:09:53.040 --> 0:09:56.240 and those were prices assuming that there wouldn't be inflation, 0:09:56.400 --> 0:09:58.880 certainly not predicting the amount of inflation we've had, so 0:09:58.960 --> 0:10:01.520 a lot of projects and stuff Africa, for example, and 0:10:01.600 --> 0:10:05.000 other African countries essentially stalled by the fact that the 0:10:05.040 --> 0:10:07.120 costs are much higher than they expected when they signed 0:10:07.120 --> 0:10:10.880 power contracts. Just going back to the topic that we addressed, 0:10:10.920 --> 0:10:12.400 you know, ok, I guess a couple of minutes ago 0:10:12.600 --> 0:10:16.960 around the role that's older could potentially play in grading 0:10:17.040 --> 0:10:20.960 domestically produced energy and alleviating some of the strain on 0:10:21.120 --> 0:10:26.040 certain grids around price volatility. How long does it take 0:10:26.360 --> 0:10:29.200 to get a project, let's not say rooftop solar, but 0:10:29.320 --> 0:10:32.959 utility scale projects off the ground, let's say, from permitting 0:10:33.000 --> 0:10:35.600 all the way through the you know, electricity going through 0:10:35.600 --> 0:10:38.520 the power lines. Oh goodness. So the longest phase in 0:10:38.520 --> 0:10:41.320 this is the permit is the permitting almost wherever you are, 0:10:41.480 --> 0:10:43.960 the longest stage. We'll be getting the permitting and getting 0:10:44.000 --> 0:10:46.840 access to the grid. Once you've done that, then actually 0:10:46.880 --> 0:10:50.400 building it can be six weeks. Wow. But of course 0:10:50.400 --> 0:10:53.240 the permitting cans like a very very long time. Okay. So, 0:10:53.280 --> 0:10:55.760 I mean this is definitely an issue of whether or 0:10:55.760 --> 0:10:58.960 not certain countries want to see these projects come online 0:10:59.200 --> 0:11:01.680 quite quickly. And you know, the role that it could 0:11:01.679 --> 0:11:05.080 play in prices in the near term actually has to 0:11:05.120 --> 0:11:08.280 do with the logistics around the project rather than the 0:11:08.280 --> 0:11:11.160 project billed itself. And that's including getting some of these 0:11:11.160 --> 0:11:14.199 panels literally shipped from where they're manufactured to the site. 0:11:14.760 --> 0:11:17.440 That's probably a bit ambitious at the moment. Six okay, actually, 0:11:18.520 --> 0:11:20.400 I mean if they're going from China to Europe, that's 0:11:20.400 --> 0:11:23.280 probably six weeks for starters. On the other hand, I'm 0:11:23.320 --> 0:11:26.040 getting some emails offering me a container of modules or 0:11:26.040 --> 0:11:28.839 two and what a dam So like, if we're willing 0:11:28.840 --> 0:11:32.120 to use mixed modules, we can probably do it pretty quickly. Okay. 0:11:32.160 --> 0:11:35.839 So I was recently reading that there were negative power 0:11:35.920 --> 0:11:39.360 prices in certain parts of the US quite recently, and 0:11:39.559 --> 0:11:42.360 you know, at a time when high energy prices that 0:11:42.520 --> 0:11:45.040 we all end up seeing on our home energy bills, 0:11:45.040 --> 0:11:47.040 and I know that you know companies are seeing as well. 0:11:47.160 --> 0:11:50.520 Could you explain a little bit how you know grids 0:11:50.600 --> 0:11:54.320 and grid rollout may end up being one of the bottlenecks, 0:11:54.320 --> 0:11:57.280 maybe a very important one for the solar industry. I mean, 0:11:57.320 --> 0:11:59.440 I know it's space that we at B and e 0:11:59.559 --> 0:12:03.280 F have recently dedicated a team too, because we understand 0:12:03.360 --> 0:12:06.880 just how critically important grid infrastructure is to the entire 0:12:07.000 --> 0:12:10.640 web of renewables and you know, the energy system as 0:12:10.679 --> 0:12:14.319 a whole. They certainly are. The thing about solar power 0:12:14.360 --> 0:12:16.640 plants is that all the solar power plants in one 0:12:16.679 --> 0:12:20.080 region generated power roughly the same time. And if you 0:12:20.200 --> 0:12:22.880 have a lot of solar power plants in one small 0:12:23.000 --> 0:12:26.120 region connected to one bit of grid and there isn't 0:12:26.120 --> 0:12:30.480 a large amount of local load that runs in the daytime, 0:12:30.720 --> 0:12:32.800 you are quite like to get grid congestion, which just 0:12:32.880 --> 0:12:35.120 means that not all the power being produced can go 0:12:35.160 --> 0:12:37.640 down the grid and you can get zero prices or 0:12:37.679 --> 0:12:41.280 even sometimes negative prices if there were some perverse local incentives, 0:12:41.679 --> 0:12:44.080 which could be fixed either by maybe putting in a 0:12:44.080 --> 0:12:46.520 battery to save some of that local power for later 0:12:46.600 --> 0:12:49.679 when the solar production drops, or just by building morgrid. 0:12:50.120 --> 0:12:52.240 In a lot of places, the battery is actually cheaper 0:12:52.280 --> 0:12:55.000 and easier than solve the problem for now, but grids 0:12:55.000 --> 0:12:57.679 are a huge part of the solution to take power 0:12:57.720 --> 0:12:59.880 being generated in one place to another place where it's 0:12:59.880 --> 0:13:03.040 more valuable. Now for a very short break, stay with us. 0:13:07.240 --> 0:13:10.240 So in short, there are well, there's more than one 0:13:10.320 --> 0:13:13.880 solution to the grid question. One of them definitely is batteries. 0:13:13.880 --> 0:13:16.720 So we'll have to be very creative thinking about the 0:13:16.760 --> 0:13:19.480 future and how all of this is interconnected. Well, and 0:13:19.520 --> 0:13:21.319 while we're on the topic of the US, because that's 0:13:21.320 --> 0:13:23.200 sort of the case study that I was using there 0:13:23.320 --> 0:13:26.040 when we let into that topic, how about the Inflation 0:13:26.120 --> 0:13:29.440 Reduction Act. And I know, you know, those who are 0:13:29.480 --> 0:13:31.800 in the US at the moment are talking about this 0:13:31.920 --> 0:13:35.160 a ton and what it means for various parts of 0:13:35.440 --> 0:13:37.680 you know, the energy system. What does it mean for 0:13:37.760 --> 0:13:41.520 solar I think it's super exciting. I very much regret 0:13:41.520 --> 0:13:44.000 that we don't have a final this is what it 0:13:44.000 --> 0:13:46.440 means for solar demand number, But I think that we 0:13:46.480 --> 0:13:49.320 will see some domestic manufacturing in the U s particularly 0:13:49.320 --> 0:13:52.160 and got some way for US again, and it probably 0:13:52.200 --> 0:13:55.559 should increase our forecast of US build because it's really 0:13:55.600 --> 0:13:58.160 generous for solar. In fact, it's so generous for solo 0:13:58.240 --> 0:14:01.120 that I'm slightly concerned it's gonna set up a lot 0:14:01.240 --> 0:14:04.439 of perverse incentives over the next few years that might 0:14:04.559 --> 0:14:07.920 lead to tweaks along the line that are somewhat disruptive 0:14:08.000 --> 0:14:11.360 to the industry. Expand on that, what are they proverse incentives? 0:14:11.800 --> 0:14:13.520 So as I understand that you'll be able to claim 0:14:13.520 --> 0:14:16.000 the production tax credit for solar, which means that you 0:14:16.000 --> 0:14:18.280 should be able to offer very very very low prices 0:14:18.360 --> 0:14:21.560 for solar, and you'll probably get that regardless of whether 0:14:21.600 --> 0:14:23.480 it's fed into the grid. So I feel like we 0:14:23.560 --> 0:14:26.520 could just have an awful lot of solar plants built 0:14:26.800 --> 0:14:30.800 in not super smart places and very quickly. Then again, 0:14:31.000 --> 0:14:33.280 maybe they'll never get permission to build anything at all. 0:14:33.400 --> 0:14:35.320 I mean in the US two there is there are 0:14:35.400 --> 0:14:37.680 major bottlenecks. I've seen a lot of in the past. 0:14:38.120 --> 0:14:41.480 Is huge solar booms like Spains, like Romanias, like the 0:14:41.520 --> 0:14:45.120 Czech Republic, and those are very often followed by retroactive 0:14:45.280 --> 0:14:49.360 changes that make it less attractive than originally anticipated. And 0:14:49.440 --> 0:14:53.440 in the meantime you get developers who overpaid for rights 0:14:53.480 --> 0:14:56.400 to build a project, and there's all kinds of mess 0:14:56.760 --> 0:15:00.600 when you have very complex but very lucrative system. SOLO 0:15:00.760 --> 0:15:04.000 is not complicated, it's actually quite simple. And when you 0:15:04.160 --> 0:15:07.200 stack layers and layers of legal and tax, equity and 0:15:07.320 --> 0:15:10.920 financing complications on top of that and pay all those people, 0:15:11.360 --> 0:15:14.280 you can end up with a very expensive and somewhat 0:15:14.360 --> 0:15:17.080 unsustainable industry. And what are some of the things that 0:15:17.240 --> 0:15:21.400 people are objecting to solar roll out about? Because I'm 0:15:21.440 --> 0:15:24.320 thinking is a parallel. We recently recorded a show on 0:15:24.640 --> 0:15:27.920 nuclear with our colleague Christodomsey, who's been covering that space 0:15:28.000 --> 0:15:30.960 for an extraordinarily long time, and you know, he talked 0:15:30.960 --> 0:15:34.480 about just the amount of run up that it takes 0:15:34.560 --> 0:15:37.280 the just like you were saying, it's that permitting process 0:15:37.360 --> 0:15:41.000 at the beginning that is critically important but adds to 0:15:41.360 --> 0:15:43.920 the timeline. And then even with wind, you know there 0:15:43.960 --> 0:15:46.520 are those groups talking about, well what about the birds? 0:15:46.640 --> 0:15:49.560 What is the thing that is that sticking point for 0:15:50.280 --> 0:15:54.960 solar that causes us opposition? Generally everyone of solo right, 0:15:55.200 --> 0:15:58.560 I mean, does obviously killed birds. It's not going to 0:15:58.640 --> 0:16:00.760 say it killed no birds because okay, there are some 0:16:00.920 --> 0:16:04.120 types of waterfowl that can mistake solar panels for water 0:16:04.440 --> 0:16:08.040 with disastrous results in the desert. But natural selection has 0:16:08.080 --> 0:16:10.920 to do something right. So generally speaking, solo you can't 0:16:10.920 --> 0:16:13.160 see it from a long way off, but it does 0:16:13.280 --> 0:16:15.640 cover land that could be used for other things. So 0:16:15.920 --> 0:16:18.320 a lot of US development is on Bureau of Land 0:16:18.360 --> 0:16:21.600 Management lands in the US, which is is desert that 0:16:21.760 --> 0:16:24.680 has been preserved because it has ecological value, and it's 0:16:24.720 --> 0:16:26.880 probably not right to just say go and build solo 0:16:26.920 --> 0:16:28.800 all over these places. You know, you have to protect 0:16:28.800 --> 0:16:31.320 the desert tortoise and the other species that live there, 0:16:31.680 --> 0:16:34.560 and you do have to do some basic research. On 0:16:34.600 --> 0:16:36.560 the other time, there's quite a lot of this land, 0:16:36.680 --> 0:16:40.720 so maybe some of it is not critically important, and 0:16:41.080 --> 0:16:42.920 you can build solo on some of it and preserve 0:16:43.000 --> 0:16:46.720 the rest. Solo versus agriculture is another big talking point 0:16:46.800 --> 0:16:48.920 that I think it's probably more talking point than a 0:16:49.440 --> 0:16:52.600 real conflict right now. It's certainly been a feature of 0:16:52.680 --> 0:16:56.400 the UK recent leadership elections. I don't know why, because 0:16:56.520 --> 0:16:58.960 very little of the UK. Agricultural land is used for 0:16:59.000 --> 0:17:02.040 solar anyway, and there's not a massive boom and solar 0:17:02.120 --> 0:17:04.359 even planned in the UK, but people are concerned about 0:17:04.520 --> 0:17:07.600 food versus fuel issues in the long run and making 0:17:07.680 --> 0:17:11.080 up solutions such as agricavoltaics, which will be combining solar 0:17:11.119 --> 0:17:14.560 panels with agriculture on the same land, which sometimes probably 0:17:14.600 --> 0:17:17.720 makes sense but probably also sometimes not. There are some 0:17:17.840 --> 0:17:21.520 crops that flourish undercover, some ways of tending those crops 0:17:21.600 --> 0:17:24.199 that can work under solar panels. My suspecials were going 0:17:24.240 --> 0:17:25.960 to find a lot of ways that don't work, but 0:17:26.119 --> 0:17:29.000 there probably are something to okay, So the land use 0:17:29.119 --> 0:17:31.680 question and ends up coming to the floor. By the way, 0:17:31.720 --> 0:17:34.679 I love the quote that everyone loves solar, I mean, 0:17:34.800 --> 0:17:37.920 Jenny Chase. For those who know you well and I 0:17:38.040 --> 0:17:40.880 think it worked with you for a while, they will 0:17:40.920 --> 0:17:44.560 know that you are quite pragmatic about the industry. You're 0:17:44.600 --> 0:17:47.480 not known for putting any sort of sunshine in roses 0:17:47.520 --> 0:17:50.000 where they don't belong on anything. So this is by 0:17:50.080 --> 0:17:53.600 far one of the most optimistic on solar rollout conversations 0:17:53.640 --> 0:17:55.440 I think I've ever had with you. So it really 0:17:55.480 --> 0:17:59.440 says something so everyone take take Jenny's optimism. Maybe optimism 0:17:59.520 --> 0:18:02.400 is not even the word. Maybe you're still equally as pragmatic, 0:18:02.480 --> 0:18:04.359 and this is just what is happening. I think that 0:18:04.520 --> 0:18:06.680 is the point that I was trying to make. Yeah, 0:18:06.760 --> 0:18:10.480 I don't love solar. I hate solar years you would 0:18:10.520 --> 0:18:13.359 too if you had. Okay, well, let's talk about the 0:18:13.400 --> 0:18:16.359 companies that are involved in this space at the moment, 0:18:16.480 --> 0:18:18.480 because you know some of the things that you're talking 0:18:18.560 --> 0:18:23.359 about in including domestic manufacturer of solar in the US, 0:18:23.720 --> 0:18:27.480 or build out of different projects in India, or even 0:18:27.680 --> 0:18:30.280 just the you know, massive scale that we see growing 0:18:30.480 --> 0:18:33.800 in China in already robust market. What are some of 0:18:33.840 --> 0:18:37.119 the companies to watch as you see it at the moment. Oh, 0:18:37.200 --> 0:18:39.199 they're there are hundreds of them. I think a big 0:18:39.280 --> 0:18:41.800 beneficiary of the i m A will be First Solar, 0:18:42.119 --> 0:18:46.040 the world's last remaining thin film manufacturer of any significance, 0:18:46.520 --> 0:18:48.560 which does manufacture in the U s. And it's also 0:18:48.960 --> 0:18:51.320 from its fact threes outside the US is not subject 0:18:51.480 --> 0:18:54.399 to restrictions in future, and there is the risk that 0:18:54.520 --> 0:18:57.919 the US will reinstate restrictions on sales and models from 0:18:57.960 --> 0:19:00.280 Southeast Asia coming into the US, which will make everything 0:19:00.320 --> 0:19:02.600 more complicated in a year and a half or so. 0:19:03.040 --> 0:19:06.760 There's always the big Chinese manufacturers. So long aging go 0:19:07.000 --> 0:19:10.920 j A Solar, Torna Solar, Canadian solar handword. Solar is 0:19:11.000 --> 0:19:14.520 working with US silicon maker. Are we see silicon to 0:19:14.640 --> 0:19:17.879 bring back some of the old silicon factories in the US. 0:19:17.960 --> 0:19:21.159 That's one to watch. The developers. Every country has its 0:19:21.200 --> 0:19:24.840 own phalanx of solar developers that are looking to get 0:19:24.920 --> 0:19:28.119 permits and and get grid connections, and those will probably 0:19:28.160 --> 0:19:31.640 just benefit from the expanding market, particularly advices dropped for modules, 0:19:31.680 --> 0:19:33.880 which will give them a little bit more margin. Yeah, 0:19:33.920 --> 0:19:37.240 there are lots of solar companies. Alright, let's look under 0:19:37.280 --> 0:19:38.800 the third a little bit, and let's go really d 0:19:38.920 --> 0:19:42.640 by one specific part of the data world, and something 0:19:42.720 --> 0:19:45.680 you don't normally spell out in a market outlook is 0:19:45.880 --> 0:19:49.679 kind of an explanation of a specific piece of methodology, 0:19:49.800 --> 0:19:51.200 kind of in the meat of it. In this case, 0:19:51.320 --> 0:19:53.879 it was the Altmands score, which is something I had 0:19:53.960 --> 0:19:56.320 not heard of, but I know many of our clients 0:19:56.359 --> 0:19:59.120 in the solar industry. You're definitely asking for detail. Line, 0:19:59.400 --> 0:20:02.560 can you lane with the altman Z scorers? End? Why 0:20:03.000 --> 0:20:05.320 the solar industry watches it, so I should have looked 0:20:05.359 --> 0:20:08.760 exactly who Altman was and when he did his research. 0:20:09.119 --> 0:20:12.960 But Altman was an economist and he produced some academic 0:20:13.080 --> 0:20:17.879 research while ago of manufacturing companies and manufacturing companies he 0:20:18.040 --> 0:20:21.280 found you could predict their publicity of bankruptcy by looking 0:20:21.520 --> 0:20:25.119 at some fairly standard financial ratios that are disclosed by 0:20:25.200 --> 0:20:28.320 public companies on stock markets. And this looks at their 0:20:28.640 --> 0:20:33.040 their assets, their liquid reserves, their market information basically about 0:20:33.080 --> 0:20:35.600 how well they're performing related to their debt. And he 0:20:35.760 --> 0:20:39.080 found that an Altman zed score above one point eight 0:20:39.320 --> 0:20:41.920 meant a manufacturing company was fairly unlike to go bankrupt 0:20:42.000 --> 0:20:44.359 in the next two years, whereas below one point eight 0:20:44.400 --> 0:20:47.240