Several photovoltaic companies in the United States have declared bankruptcy this year, including some American photovoltaic giants. As early as 2023, more than 100 customers and distributors of photovoltaic companies in the United States have gone bankrupt, six times the total number of the previous 3 years. Analysts predict that more than 100 companies will face bankruptcy as well.
According to 'Science and Technology Innovation Board Daily' on July 20th, installation volume is declining and large-scale installers have announced bankruptcy one after another - the US photovoltaic industry for homeowners appears to be on the verge of collapse.
During a recent online seminar, ROTH Securities demonstrated data indicating that the US photovoltaic market is gradually adjusting to adapt to the interest rate environment. Under multiple factors, the installation volume of US residential photovoltaics will drop by 20% year-on-year by 2024.
Accompanied by the great momentum are the cold wave of bankrupt US photovoltaic manufacturers.
On July 19th EST, SunPower's US stocks plummeted by more than 50% and its stock price hit a historic low - investment bank Roth MKM said that SunPower told dealers on July 17th that they no longer support new lease and purchase power agreement sales, cannot provide installation services any more, and will stop shipping.
In the view of analysts, this means that the veteran photovoltaic manufacturer founded in 1985 is moving towards the end, and is likely to enter the bankruptcy liquidation process; some organizations even directly downgraded the target price of the stock to $0.
This is the third photovoltaic company to fall in the United States in the past month.
A few days ago, US photovoltaic manufacturer Toledo Solar just announced that all research and development will be terminated immediately and operation will be gradually stopped. Toledo Solar focuses on the residential market and is based on the cadmium telluride thin film solar cell technology route. According to another US company First Solar, the laboratory efficiency of cadmium telluride thin film batteries is over 22.1%, and the component efficiency is about 19.5%. (Note: In May of this year, Chinese leading enterprise JinkoSolar announced that its N-type TOPCon-based perovskite stack cell conversion efficiency reached 33.24%).
On June 28th, residential photovoltaic installer Titan Solar Power also announced its permanent closure. As one of the largest residential photovoltaic manufacturers in the United States, Titan Solar has an 11-year history. Last year, it ranked sixth in the country's residential photovoltaic market.
"Titan" is an ancient god family in Greek mythology, which once ruled the world but was eventually overthrown and replaced. This word also means "giant" in Chinese. The Titanic, which sank in the North Atlantic, was named after it as well.
Now, the leading company like Titan Solar and SunPower, as well as many other US photovoltaic companies, have fallen in the tide of the times.
▌Lack of regulation and policy changes
In addition to the above mentioned three companies, many photovoltaic companies in the United States have declared bankruptcy this year, including Infinity Energy, Solcius, and Kayo Energy, etc.
As early as 2023, more than 100 customers and distributors of photovoltaic companies in the United States have gone bankrupt, six times the total number of the previous 3 years. Analysts predict that more than 100 companies will face bankruptcy as well.
There are multiple factors that dragged these photovoltaic companies down to the abyss.
In most states in the United States, many residential photovoltaic companies are only responsible for installation and depend on third-party distributors for product sales. During promotion, sales personnel make various "fancy" promises, such as no electricity bill and getting government tax incentives. However, after the photovoltaic cells are installed, sales personnel disappear without a trace, and the installation company is on the verge of bankruptcy. This is a significant defect in the US photovoltaic industry model - sales personnel use any means to sell products, and government regulation and user protection are lacking. "I often hear people compare photovoltaic loans and sales to 'Wild West', because it involves 'creativity (fancy)'. This is the Valley's mantra: 'Break the rules and let regulatory agencies solve the problem.'", said Jamie Johnson, the founder of Energy Sense Finance.
In addition to this, many US policies also have an impact, such as those proposed by the US residential photovoltaic insurance company Solar Insure -
Interest rate hike: The Fed raised interest rates to curb inflation, which has caused the cost of loans to rise. On the one hand, it weakens the attractiveness of photovoltaic systems as a cost-saving investment, further leading to a decline in consumer demand for photovoltaic systems. On the other hand, photovoltaic contractors rely heavily on loans as operating funds, and the interest rate hike leads to increased costs, thereby causing cash flow problems, and some photovoltaic companies start to go bankrupt.
In addition to this, there are many other factors, such as policy support changes and subsidy reduction, trade disputes between countries, and the depreciation of the RMB exchange rate against the US dollar, etc.
Changes in photovoltaic loans: In response to the high-risk financial environment, photovoltaic loan institutions have adjusted their payment structures. Under the situation of delayed payment, the cash flow challenge for photovoltaic contractors has become more severe, the balance sheet also needs to bear more pressure, and the management ability of operating expenses is damaged.
Policy changes: California's photovoltaic new policy NEM 3.0 significantly reduces the compensation for local rooftop photovoltaic owners for excess electricity, extends the investment return period, and reduces the attractiveness of photovoltaic installation.
All of the above not only affects the photovoltaic enterprises mentioned earlier, but even affects the entire US household photovoltaic market.
Taking California, which is most affected by NEM 3.0, as an example, local photovoltaic demand plummeted and rooftop photovoltaic installations decreased by 80%. The California Photovoltaic and Energy Storage Association reported that thousands of projects have been shelved, more than 17,000 employees have been laid off, and a wave of well-known enterprises have declared bankruptcy.
If initially only smaller companies fell in the US household photovoltaic cold wave, the bankruptcy of major companies like Titan Solar now indicates that the situation has become more severe.
In the US household photovoltaic industry, leading companies such as Sunrun and Sunnova are also deeply mired: poor management, dismal performance, and their stock prices have fallen by 80% from their historical peak in 2021.
In recent years, US photovoltaic companies have instilled in local residents the idea that "saving money and saving the earth can be achieved together." But now, what they may need to save most is themselves.