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SolarCity's percentage of the total solar market "pie" will probably decrease over the next few years, but the company's long-term prospects are very good. This is due to a few different factors, most important is the fact that the solar market is growing at an extremely fast rate.
In the second quarter of 2015, the US installed 1,393 megawatts of solar. That's compared to 180 megwatts in 2010, just 5 years ago: In short, the total solar energy pie is almost 8 times what it was half a decade ago. Even as the market grows exponentially larger, SolarCity remains the largest installer by far. In 2014, SolarCity installed 34% of the residential systems that connected to the US grid. The closest competitor, Vivant Solar was only responsible for 13% of US residential solar installs - less than half SolarCity's haul. Looking forward, SolarCity has a lot of great things working for them - including a very powerful and recognizable brand. With the leadership (and brand attachment) of someone like Elon Musk, who creates a considerable buzz no matter what he does, SolarCity has an intrinsic advantage when it comes to shopping for energy services like solar. One of the biggest challenges facing SolarCity will be to maintain a high-quality product and customer service while trying to scale at the same pace while the industry expands. Total system or per kWh rate are the ultimate decision-makers when it comes to making energy choices, and so far SolarCity has maintained some of the most consistently low prices. As the market expands, competitors (small and large) will be looking to undercut prices and provide better service. But SolarCity has at least one gamechanger still up its sleeve: Batteries. Through its partnership with Tesla - another of Elon's companies - SolarCity has announced the rollout of the Tesla Powerwall, a battery that can be paired with your solar system to help you ride out power outages and further lower your reliance on your local utility. This is a real advantage that many in the solar market are scrambling to match and it should drive lots of sales in the coming years. In the end, macroeconomic trends (stuff that SolarCity can't really control) will have a major impact on the profitability of the company. This includes the potential expiration of the Investment Tax Credit - a credit that pays for almost 1/3 the cost of a solar project. Nonetheless, SolarCity will likely continue to dominate a growing market for some time. |
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Previous : energy
1 Comments
Brilliantly executed!
Posted 12-11-2015 06:29