Soligent summarizes 2020 while predicting solar trends for 2021

By Jon Doochin, CEO of Soligent. Originally posted on and reposted with permission. That story can be found here.

In many ways, 2020 looks like the worst year for a multitude of generations of Americans. That said, 2020, for better or worse, has accelerated us into the future. Here’s what we can realize coming out of 2020 and expect for 2021 for residential and small commercial solar.

3 Solar Industry Trends from 2020

A Year of Dramatic Acceleration — I think it is fair to say that the vast majority of America never fathomed even a fictional movie where the world wears face masks, large layoffs devastate families and economic shutdowns affect whole states and industries. But with this comes substantially accelerated trends. At the convergence of technological services and internet bandwidth that allows a seamless digital and remote work experience is a growing trend of sourcing the highest caliber talent anywhere in the world at the most competitive cost. Moreover, whereas the adoption of a certain type of software was often a deprioritized luxury for local businesses, they have quickly become a necessity and thus transformed the adoption rate of a technology trend.

Furthermore, consumers need a sense of certainty in their lives, and with fires, hurricanes and blackouts sweeping the country, energy storage gets a boost in its adoption curve. Additionally, white-collar incomes have been on the rise with the stock market reaching record peaks, home buying growing faster than expected and the national savings rate at a 45-year high. Finally, 2021 has seen the rise of the largest cumulative solar and storage valuations, public stocks and a growth of investors seeing green as a fast-growing alternative to oil and gas. These factors, with the substantial possibility of further stimulus money, position 2021 for a strong year.

A Year of Demand and Manufacturing Shocks — From oversupply in the first half of 2020 to leveling but healthy inventory in Q3 to Q4 delivery shocks and pushouts, 2020 saw supply swings. Not to mention on-again/off-again bifacial solar panel tariffs and general COVID-related demand shocks in both directions. Now at the end of the year with demand that has been growing since the summer, the world is met with all-time high COVID infection rates, ports are congested and holding product, and the solar ITC takes another step down.

Yet solar installers are well prepared to deal with the ups and downs. Technology advancement in the manufacturing space has continued to move forward at the same rapid pace. Battery prices are dropping, solar panel sizes are increasing while getting cheaper, and inverter roadmaps continue to push forward to their promised output.

A Year of Giving and Education — One of the joys of 2020 has been the support from people of all walks of life. At the beginning of this pandemic, we at Soligent did weekly education sessions with thousands of installers to help them navigate this new future. We taught everything from how to receive Paycheck Protection Program funds to balancing cash flows in a crisis to tips for selling in a virtual world. We extended credit lines and supported those in need. We sent holiday gifts to needy children. We saw that we’re not alone, and everyone stepped in to help when they could. I couldn’t be prouder of so many people in our energy industry.

Sneak Peek: 3 Solar Industry Trends for 2021

Geographical and Product Expansion — The fastest growing states for solar were once driven by incentives and climate. Today, there is growth across the country from Florida to Texas to Illinois and onward. Costs have fallen, installers are becoming more efficient and manufacturers are trending toward full-wallet share portfolios that help them capture more installer and consumer spending. This trend will continue to accelerate in 2021.

Demand and Supply to Increase — We expect to see solar demand climb with storage and EV additions and low interest rates. That said, there is a potential for module oversupply in 2021 as large solar manufacturers ramp to their highest capacities and outpace demand at times.

Tax Credit is Still in Play — With or without the tax credit extension, we expect 2021 to be a big year for solar. If the tax credit sunsets as planned, we’ll have the traditional rush to install solar by the end of the year. If the tax credit is extended, 2021 will still be significant for residential installers as decreasing costs and continued work-from-home plans lead to increased demand.

The truest summary of the last year is that clean energy is here to stay. This is a larger secular trend that is economically beneficial for the United States and GDP-positive for a world in need of GDP. Solar is a money multiplier — if a homeowner pays less for energy, there’s more disposable income to spend, stimulating the economy. Installers are local businesses that pay salaries and create jobs, which again stimulates the local economy with spending and wealth creation. Through public markets and IPOs, solar manufacturers, distributors and others allow the general public to participate in the macro trend of growth in the space. Hindsight is 20/20, but foresight is seeing the inbound secular trend and the benefits from local jobs to GDP.