Exploting Underutilized Solar Panel Niche Markets.

• Author: Amarante, Joseph R.

INTRODUCTION TO THE SOLAR MARKET

This paper first explains the need for solar, and the different types of solar panels and installations commonly found on the market. While most solar markets are saturated, an entrepreneurial opportunity of floating solar panel systems targeted with water authorities and companies is discussed. The results of interviews with these companies' decision makers are presented to gauge the possibility of smaller scale freshwater floating solar panels is provided. The article concludes with the feasibility of a small business venture and partnership with a university to kick start such projects with energy utilities.

With a rise in global interests in alternative and renewable energies, the demand for solar can be expected to increase as well. Solar is a desirable energy source due to being a clean alternative to traditional energy use such as oil, gas, and coal. Using solar instead allows for reductions in carbon dioxide, sulfur dioxide, and nitrogen oxide emissions (Siler-Evans, 2013). Reducing these greenhouse gases allows for cleaner air and better health and environmental consequences.

The solar industry has been steadily expanding. In 2017, solar represented 55 percent of all global newly installed renewable energy (Teske, Meinshausen & Dooley, 2019). The success of this energy source in the United States is largely due to federal and state tax incentives and programs that made it easier for not only customers to purchase solar panels, but also encouraged solar businesses to enter in the market. This made solar a state revenue stream totaling 1.6 billion dollars and moved it towards cleaner alternative sources of energy (SEIA, 2019). In Connecticut, the price of solar panels has dropped 47 percent in the last five years, and solar contributes to 1.47 percent of the energy market in the state (SEIA, 2019). Furthermore, many other states have committed to their own alternative energy goals. The size of the solar project will affect the energy produced and cost of the system. The average price of residential solar in the United States has fallen to approximately 18,000 dollars (SEIA, 2019).

For example, the current residential solar panel installation market in Connecticut can be estimated using data provided by the Connecticut Green Bank. They have monitored the number of residential sales for each installation company since 2011. The CT Green Bank has helped households obtain loans, leases, rebates, and incentives to further promote solar energy in the state. In 2018, the Connecticut Green Bank listed the competition in Connecticut as consisting of 54 solar companies and a total revenue of over 138 million dollars, with 19 of these providers holding 98 percent of the market (The Connecticut Green Bank, 2019). The largest competitor was Sunnova which held 1,893 completed contracts out of 4,799. This gave them a market share of 39.44 percent. 35 companies represent the group "Other" in the chart with 98 installations (The Connecticut Green Bank, 2019). A list of company sales is summarized in Table 1:

These companies are providing the same products and services, with similar incentives. It is difficult to obtain any differentiation as these companies rely heavily on direct sales and do very little to market themselves differently. Many companies used purchasing power agreements (PPA) to get contracts with customers. These allow the installers to finance the solar panel project for their customers at no upfront cost, and allow their customers to buy the energy from the providers. PPAs had helped solar companies in Connecticut make sales even though there was a drop in product diversity among providers in 2018 (Sauer et al., 2018).

Given the growth in established rooftop and ground installations, there is limited incentive to pursue less proven opportunities in the current floating solar panel market. This is understandable, but ironic, given the revenue potential of these new water-based solar systems. The most common applications for floating solar panels are medium size installations on lakes, reservoirs, and small ponds. There are many examples of these around the world. The largest installation is in China and consists of 166,000 solar panels, and sits on a lake that once was used for coal mining (Campbell, 2019). It is able to produce 40 megawatts of power. China too has an enormous potential for floatovoltaics. It is estimated that they can house over 160 GW of floating solar panels on their water (Kumar & Mallikarjun, 2018). While Japan has the most of these systems, China sure has the largest; consisting of 20MW and 40MW floating solar arrays (Campbell, 2019). Another application which is in New Jersey sits on a water treatment reservoir that has 400 solar panels and can produce 135,000 kilowatts per hour annually (Landers, 2011). California's application of floating solar arrays on commercial winery reservoirs provide between 33 and 200 kilowatts per hour (Aspen Publishers, 2009). It is obvious that Asia-Pacific countries are leading the industry with floating solar arrays. The United States should take this information as a learning opportunity; perhaps, they should be moving into larger floatovoltaic systems rather than smaller scale utility projects. This paper, however explores the latter. The NREL estimates that there are 24,000 man-made bodies of water in the United States that could house this technology (NREL, 2018), and this could provide the country with 10 percent of its energy per year. With the number of water bodies in the United States there is money to be made here.

THE SOLAR OPTIONS

Solar panels can be made from a variety of materials, depending on the application and the price point. They also can be installed in a variety of applications, the most common being on building, on ground, and on water. These installations vary from smaller residential applications, larger commercial and industrial applications, to massive utility applications. In short, customers can incorporate solar technologies and projects in a variety of customized ways to optimize meeting their energy needs.

Types of Solar Panels

Traditional...