SolarCity Corporation Thinks These Are 3 of Its Biggest Risks
1. The Status Quo
1. The Status QuoSolarCity Corporation’s rooftop systems threaten the utility
sector’s status quo, and not everyone is happy.
Some utilities have embraced decentralized renewable energy solutions: NextEra Energy’s (NYSE:NEE) and SolarCity
Corporation are teaming up to triple Hawaii’s solar power.
1. The Status Quo
But other utilities see SolarCity as a threat, and are pushing regulators to increase oversight and grid
responsibility for rooftop solar owners.
If solar users have to pay production fees or can be charged more for their utility-bought electricity, that
could tip more scales back in favor of utility-generated electricity.
2. Disappearing Subsidies
2. Disappearing Subsidies
Solar use is soaring, but the industry still relies on production tax credits to make many of its modules
cost-competitive.
SolarCity Corporation and its customers have historically enjoyed a 30% investment tax credit, but
that could soon disappear.
2. Disappearing Subsidies
The tax credit is set to disappear for residential homeowner-owned systems in 2017, while third
party-owned systems like SolarCity’s get to hang on to a 10% credit.
3. China Solar Trade
3. China Solar Trade
SolarCity Corporation relies on China for “a significant portion” of its solar panel components.
U.S.-China solar trade soured in 2012 when the U.S. imposed import taxes ranging from 35% to 255% on
solar cells.
3. China Solar Trade
Those tax rates have declined since 2012, but the U.S. continues to investigate different aspects of U.S.-China
solar trade.
In September 2014, SolarCity Corporation bought manufacturing company Silevo Inc. to bring Chinese
manufacturing into its own business, but it will continue to rely on other suppliers for the near future.
The next billion-dollar iSecret The world's biggest tech company forgot to show you something at its recent event, but a few Wall Street analysts and the Fool didn't miss a beat: There's a small company that's powering their brand-
new gadgets and the coming revolution in technology. And we think its stock price has nearly unlimited room to run for early-in-
the-know investors! To be one of them, just click here.
Top Related