tag:blogger.com,1999:blog-69374632024-03-13T06:29:03.073-07:00Disruptive Business ModelsA blog on using the power of Disruptive Business Models to build successful businesses...and other stuff. by Joe AgliozzoJoe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.comBlogger48125tag:blogger.com,1999:blog-6937463.post-24062068689194170282009-10-20T18:21:00.000-07:002009-10-20T18:21:13.341-07:00Inverters - the next wave to "green the grid"More details soon, but learning a lot about inverters and how electricity moves around the power grid. Reactive power is what allows the energy to flow - creates magnetic field, etc. It is something you don't see or know it's there (or sometimes that you are paying for it) but it makes it all possible. There are a lot of efficiency gains to be made both on the grid and within end-user facilities. More soon on this subject.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-8722939855316899192009-04-15T09:13:00.000-07:002009-04-15T09:14:15.251-07:00Sale of Largest Solar Distributor in North America - ClosedThis is the deal we worked on for 18 months - now going full bore on solar finance!<br /><br />Acquisition Gives ITOCHU Largest Solar Distribution Network in the U.S.<br />April 13, 2009<br /><br />New York: April 13, 2009 -- ITOCHU Corporation, jointly with ITOCHU International Inc. (collectively, ITOCHU), has agreed to acquire the business of SolarNet LLC, a solar energy solutions provider that includes DC Power Systems, the largest privately-held wholesale distributor of solar energy systems in the US, and Stellar Energy Solutions. ITOCHU has been actively implementing a global solar energy strategy since 2006 and has made a number of strategic investments, including the acquisition of California-based wholesale distributor and systems integrator Solar Depot in 2007. With the acquisition of SolarNet, the combined market share of Solar Depot and DC Power will give ITOCHU collectively the largest solar distribution network in the US. SolarNet will be operated as a majority-owned subsidiary of ITOCHU, beginning immediately. While the current management and employees will be retained, ITOCHU personnel will be added to strengthen the capability of SolarNet.<br /><br />ITOCHU also supplies manufacturing equipment to solar module manufacturers globally and is involved in the systems integration, financing and development of solar energy projects in various countries. Observing the rapid growth in the solar industry, ITOCHU recently centralized all its solar energy related business into a new business department in order to provide a stronger and more streamlined approach to executing its solar energy business.<br /><br />“ITOCHU is pleased to add the substantial business experience and capabilities of DC Power and Stellar Energy Solutions to our rapidly growing solar energy business activities in the US market and around the world,” said Harutoshi Okita, Senior Vice President, ITOCHU International Inc. “This acquisition expands our presence in the US distribution market and extends our capabilities with regard to the development of large-scale solar systems.”<br /><br />ITOCHU expects this development to result in an improved product offering and level of service for solar dealers and customers across the country, making world-class solar solutions available at the most competitive prices. The acquisition also positions ITOCHU as a leading integrator of commercial-scale solar power systems, with a project pipeline of over 80MW across the US.<br /><br />“SolarNet’s partnership with ITOCHU will give our companies the resources to execute our aggressive business plan and continue to provide outstanding customer service in a rapidly growing business. We are excited to have a partner with such a long-term vision and global reach,” said Joseph Marino, President of SolarNet. Mr. Marino will continue with SolarNet after the acquisition as a member of the Board and as Founder.<br /><br />ITOCHU will actively expand SolarNet’s business throughout the US market by building on its existing solar energy business activity and utilizing its global business network to add value to SolarNet. Through these efforts, ITOCHU expects its growing solar operations to accelerate the adoption of solar power in the US.<br /><br />Minority owners of SolarNet and Board Members include Chris Tyson and Mark Sampson, who will focus on providing financing services to the company and solar industry (www.energyfinancecompany.com and www.newedgesolar.com).<br /><br />*********************************************************<br />About ITOCHU<br />ITOCHU Corporation is a diverse global trading company headquartered in Tokyo with annual revenues of more than $28.5 billion in the fiscal year ending March 31, 2008. Founded more than 150 years ago, ITOCHU consistently posts global trading transactions of over $100 billion every year. With more than 150 offices in more than 70 countries, ITOCHU Corporation operates over 700 domestic and overseas subsidiaries and affiliates involved in a wide array of industries, including technology, energy, media,<br />telecommunications, aerospace, electronic machinery, textiles, food products, finance, real estate,<br />insurance and logistics services.<br />For more information on ITOCHU Corporation, please contact<br /> https://www.support.itochu.co.jp/main/ssl/coy/inquiry_other/inq_other_e.html or visit the ITOCHU<br /> websites at www.itochu.co.jp/main/index_e.html and www.itochu.com.<br /><br />About SolarNet<br />SolarNet™ facilitates solar energy solutions by fostering collaborations between solar contractors, engineers, architects, investors and energy users. By utilizing Solar Service Agreements (SSA), innovative financial contracts that pair solar investors with energy users, SolarNet makes large-scale solar solutions accessible to more corporate and government clients. For more information, please contact David Michalek at david@dcpower-systems.com or visit the SolarNet website at www.solarnet.us.<br /><br />About DC Power Systems<br />DC Power Systems is the largest privately-held wholesale distributor of solar energy systems in the US. Established in 2000 in Healdsburg, CA, the company has grown rapidly and is a full-service provider to over 1,000 dealers throughout California, the US and Latin America. DC Power serves residential and commercial markets through four warehouses coast-to-coast. DC Power offers in-house design, engineering and installation support to its SolarNet™ dealers. The company's world-class technical expertise encompasses a broad range of technologies allowing adoption of the most site-appropriate products. DC Power also offers small-scale wind turbine systems.<br /><br />More information on DC Power Systems: www.dcpower-systems.com<br /><br />About Stellar Energy Systems<br />Established in 2004, Stellar Energy is a leading solar system integrator with comprehensive services including project financing, engineering and installation management. Recently, Stellar, SolarNet and Sharp collaborated to design and construct the largest solar installation at a winery and one of the largest in California – a combined 2.8MW owned by Foster’s Wine Estates.<br /><br />More information on Stellar Energy Solutions: www.stellarenergy.com<br /><br />About Solar Depot<br />Solar Depot is a wholesale distributor and systems integrator of solar electric and solar thermal systems. For over 30 years, Solar Depot has been designing and supplying solar energy systems for residential, commercial and industrial applications, making Solar Depot among the largest and most experienced solar integrators in the United States. Solar Depot serves its customers through three full-service facilities in California, located in Petaluma (corporate headuarters), Sacramento and Corona. For more information, please contact Kevin Shimokobe at kevin-s@solardepot.com or visit Solar Depot’s website at www.solardepot.com.<br /><br />Media Contact at ITOCHU International Inc:<br /><br />Michael Solomon: Michael.Solomon@itochu.com, (212) 818-8083 or (914) 960-2368<br /><br />Source: ITOCHU International Inc.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-14489652291125222272009-02-24T14:34:00.000-08:002009-02-24T14:39:18.093-08:00PG&E 500MW plan - 1/2 PG&E Land 1/2 PrivateMany <a href="http://www.mercurynews.com/ci_11775442?source=rss">reports</a> of announcement - but the really interesting news is that 1/2 (or 250MW) will be contracted out to private developers. No details on whether this will be "build to own" or PPA style deals (with PG&E as offtaker).<br /><br />Question - can PG&E take the CSI subsidy as well? Or is that a violation of the CPUC rules that setup the CSI?Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-74209282780233991252009-02-24T09:32:00.000-08:002009-02-24T09:40:46.206-08:00Solar in a Box - the Ultimate Residential Solution?Installation costs for residential solar typically represent more than half the cost of the installed array, and the installation process cries out for innovation. Several companies have created "solar in a box" products. Typically, they come in kit form and include panels with dedicated inverters, racking/attachment system and wiring for interconnection to the grid.<br /><br />Here's a typical <a href="http://www.readysolar.com">example</a>. <span class="text"><br /><br />This is a good start, but there are some tradeoffs with this type of system:<br /><br />1. the low profile means that you will not get optimal tilt for maximum efficiency;<br />2. the low profile may also create roofing issues - both for air circulation and also roof replacment<br />3. these systems still require multiple roof penetrations, which may cause maintenance issues in the future<br />4. the micro inverter systems provide for easy assembly and redundancy (partial panel shading is less of an issue with microinverters, as is individual failure) but also add cost.<br /><br />I haven't yet seen any installation cost figures with these systems, but it is interesting to think of this type of product being used in a DIY application. Say for sale at Home Depot, the homeowner can install the system and call on a licensed electrician simply for the interconnect. That may be one way to reduce installation costs down to more like $1-2 per watt, giving the homeowner and extremely fast payback when including subsidies and the new federal solar grant.<br /><a href="http://www.buildinggreen.com/go/offsite.cfm?link=www.readysolar.com&RefType=company&RefID=2700&linkLabel=website" class="text-link" target="_blank"><span class="text-link"></span></a></span>Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-72630103472963791322009-02-17T15:32:00.001-08:002009-02-17T15:35:56.744-08:00Grants instead of Tax Credits - Boom?The new stimulus bill apparently will provide for government grants to replace the current tax credit scheme. On the surface this should solve a lot of problems, since as everyone knows there is a lack of investors with tax credit appetites. Couple of interesting wrinkles though (as I understand it):<br /><br />1. must place in service in 2009 or 2010 - so long term projects are out of luck (like utility scale solar)<br />2. must be a tax paying entity to use (so non-profits, schools, etc. would still seem to need a third party ownership structure to facilitate)<br /><br />Will be interesting to see what the regs that actually implement the legislation look like and how long this will take. Could affect project/construction finance if the grant check is going to take a long time to process, for example.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-86166624364683391462009-02-04T16:54:00.001-08:002009-02-04T16:56:09.133-08:00Solar Data - Opensolar.orgGreat mashup of CSI data and Google Maps - you can see the locations, components of costs of projects that have received CSI rebates - <a href="http://opensolar.org/">http://opensolar.org/</a>.<br /><br />Suggestions -<br /><br />1. Instead of pulldowns provide search functions for installers.<br />2. Allow searching/sorting by geo, size, $$, type of panel, date, etc.<br /><br />Great start though and very useful..Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com2tag:blogger.com,1999:blog-6937463.post-57225748725450292752009-01-30T10:07:00.000-08:002009-01-30T10:09:31.974-08:00MMA New $200M fund - $10/watt?News on MMA's new fund - http://greenwombat.blogs.fortune.cnn.com/ - stated $200M fund, 20.6MW = approx. $10/watt.. This seems high in relation to the prices we are seeing and what most lenders will fund. Possible developer note/other depreciation or tax credit multiplier?Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-35193724225023496622009-01-30T10:03:00.000-08:002009-01-30T10:04:12.781-08:00Using Twitter to Update my BlogCan't seem to get it together to post more often, so just added Twitter Badge. Will try that!Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-83427584111467513802008-07-23T09:18:00.000-07:002008-07-23T09:45:57.731-07:00AB 811 - New California Law Authorizes Cities to Make Low Interest Solar LoansCalifornia has passed a new law <a href="http://info.sen.ca.gov/pub/07-08/bill/asm/ab_0801-0850/ab_811_bill_20080721_chaptered.pdf">AB 811</a>, that authorizes cities in California to make low interest loans secured by a lien on the property. The liens transfer to any subsequent owner if the property is transferred and the property owner makes payments much as they would property tax payments.<br /><br />This mechanism should allow cities to easily raise bond money to finance the programs, given that the loans are secured by liens and, like tax liens, will presumably be senior to all other liens.<br /><br />The low interest and presumably easy availability of these loans should be a serious spur to PV sales. Low interest loans plus the CSI will bring many installations close to grid parity on a monthly basis.<br /><br />I also think this has to be seriously troubling to PPA and lease providers.. wonder what their "spin" will be?Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-18484372339718350012008-03-28T09:24:00.000-07:002008-03-28T09:39:55.336-07:00SCE ProLogis Solar Deal - Who pays?Yesterdays <a href="http://www.commercialpropertynews.com/cpn/content_display/property-types/industrial/e3i93b11000fba320fcc2192633b9384118">announcement</a> that ProLogis had agreed to lease roofspace to SCE for solar arrays raises some interesting issues for the industry, most importantly, can private sector PPA based solar integrators be competitive with public utilities?<br /><br /><a href="http://arnoharris.typepad.com/cleanenergyfuture/2008/03/sce-prologis-so.html">Arno Harris</a> thinks so. He is the CEO of Recurrent Energy, so of course he has to!<br /><br />The biggest question is whether the public (and the many public watchdog groups) will support the rate hikes that SCE will propose to finance this project. Should ratepayers finance SCE's entry into yet another profitable business for SCE? What does this say about using regulated/captive customer bases as a competitive advantage over private enterprise?<br /><br />This is also an interesting deal for ProLogis. Arno Harris says he knew that SCE and ProLogis were talking, but doesn't indicate why they went with SCE instead of Recurrent Energy or some other PPA company. You would have to think it was simple economics. Presumably, ProLogis would make more from leasing the roofs to SCE that it would selling power to tenants. Again this raises the competition question.<br /><br />Mr. Harris also says the deal "<strong>Doesn’t Serve ProLogis’ Tenants or Green their Buildings</strong> – This sounds like a great deal for SCE and ProLogis—but it doesn’t allow ProLogis to make any green claims about their properties and it provides no benefits for their tenants. From what we can see, all the green benefits go to SCE and ProLogis just gets some roof rent."<br /><br />I am not sure I follow that argument. If you make your rooftop available to solar, the equipment is installed and generated power that is replacing other less green power, presumably you have "greened" your building. Hard to see how the "greenness" depends on who you sell or provide the power to. Also, it seems that ProLogis received plenty of positive publicity and the other "warm fuzzy" factors an institutional landlord presumably cares about when doing green deals yesterday.<br /><br />I do however agree with his observation that it remains to be seen whether this plan really gets off the ground, or whether it dies at the feet of the CPUC (failing to approve rate increases to pay for it) or other reasons. Lastly, if the deal does get done, it will be interesting to observe this massive plans effect on supplies of solar panels, inverters, etc. Supplies could well tighten and make other projects unfinanceable for ReCurrent Energy and others in the PPA business.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com2tag:blogger.com,1999:blog-6937463.post-1784303086308632142008-03-19T07:58:00.000-07:002008-03-19T10:06:45.581-07:00California Solar Initative - Affordable Multifamily ProgramThe CSI is making progress on the long promised program for affordable multifamily housing. A draft staff proposal was submitted on February 29, 2008 and a public hearing was held this week. Presumably the program should be available in the next 90 days.<br /><br />This one is going to go fast, even faster than the commercial CSI, which in many areas is now all the way down to step 5 ($.22 per KwH). The affordable multifamily program is only slated to get $100M and the subsidy will be an EPBB, and may be as high as $3 per watt! This subsidy, combined with the federal tax credit (at least through the end of 2008!) and depreciation means that it should be possible to offer solar systems to property owners at very little (or no) capital cost and relatively competitive power purchase rates and terms.<br /><br />Again, I imagine this will be a "race to file" in order to reserve these credits. Property owners should be out getting all their engineering and pricing done now!Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-70410345450241796662008-01-17T10:44:00.000-08:002008-01-17T10:51:25.038-08:00California Solar Initiative Subsidies are Going Fast!California Solar Initiative Subsidies are Going Fast!<br /><br />Here's the latest numbers:<br /><br /><span style=";font-family:arial,helvetica,sans-serif;font-size:100%;" ><strong>January 2008 Opens with High Solar MW Reservations<br /> </strong></span> <table border="0" width="87"> <tbody> <tr style="color: rgb(0, 0, 0);"> <td colspan="5" bg="" style="font-family:arial,helvetica,sans-serif;"> <div align="center"> <strong><span style="font-size:78%;">TRIGGER TRACKER SNAPSHOT FOR<br /> JANUARY 15, 2008</span></strong> </div> </td> </tr> <tr> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">Administrator</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">Customer</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">Current Step </span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">MW in Step </span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">MW Under Review </span> </div> </td> </tr> <tr> <td rowspan="2" style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;"><a href="http://cts.vresp.com/c/?CaliforniaPublicUtil/5a225f05da/9a18a56f94/c6259a5ad0/Administrator=PGE" target="_blank">PG&E</a></span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" ><span style="font-size:85%;">Residential</span></td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">3</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">14.40</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">2.08</span> </div> </td> </tr> <tr> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""><span style="font-size:85%;">Non-Res</span></td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">4</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">38.10</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">17.85</span> </div> </td> </tr> <tr> <td rowspan="2" style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;"><a href="http://cts.vresp.com/c/?CaliforniaPublicUtil/5a225f05da/9a18a56f94/bbdd7afcdc/Administrator=SCE" target="_blank">SCE</a></span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" ><span style="font-size:85%;">Residential</span></td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">2</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">10.60</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">1.31</span> </div> </td> </tr> <tr> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""><span style="font-size:85%;">Non-Res</span></td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">4</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">40.10</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">21.09</span> </div> </td> </tr> <tr> <td rowspan="2" style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;"><a href="http://cts.vresp.com/c/?CaliforniaPublicUtil/5a225f05da/9a18a56f94/1393c27d73/Administrator=SDREO" target="_blank">CCSE</a></span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" ><span style="font-size:85%;">Residential</span></td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">3</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">3.40</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" > <div align="center"> <span style="font-size:85%;">0.28</span> </div> </td> </tr> <tr> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""><span style="font-size:85%;">Non-Res</span></td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">4</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">9.00</span> </div> </td> <td style="color: rgb(0, 0, 0);font-family:arial,helvetica,sans-serif;" bg=""> <div align="center"> <span style="font-size:85%;">1.86</span> </div> </td> </tr> </tbody> </table> <p> As you can see, Tier 2 is mostly gone throughout the state, and Tier 3 for commercial is only available in PG&E administrated areas. The question now is whether installed prices will drop fast enough to make up for the lowered subsidy, or will we see a "bust" - lack of new solar projects now that the high subsidies are all reserved?</p>Also at issue is the 30% federal tax credit that expires at the end of 2008. There was no extension of the credit in the energy bill enacted in December 2007.<br /><br />The first quarter of 2008 should be very interesting for observing announcements of new projects (or lack thereof).Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-51967190385614235702007-12-02T13:07:00.000-08:002008-01-02T13:32:57.343-08:00California Energy Commission Report on Solar PotentialThe California Energy Commission (CEC) through the Public Interest Energy Research Program (PIER) commissioned a report from Navigant Consulting that has quite a bit of useful data (as of September 2007) for solar market sizing. The report is titled "California Rooftop Photovoltaic (PV) Resource Assessment and Growth Potential by County, and can be downloaded <a href="http://www.energy.ca.gov/publications/displayOneReport.php?pubNum=CEC-500-2007-048">here</a>.<br /><br />The report focuses on the potential for PV installations by county for the state of California, and takes into account such factors as roof tilt, shading, declining installations costs, tax credits, etc. in order to arrive at a total possible installed generating capacity.<br /><br />One thing that really jumps out is that Navigant estimates a max of 500MW in installed panels by 2016 without subsidies, but that the use of subsidies will increase the total installed base to 800MW.<br /><br />Then Navigant makes another assumption that "new business models" such as power purchase agreements (PPA's) come into play. Using PPA's plus all available subsidies, the total installed market jumps to 1,700 MW by 2016. So in effect the PPA's could have more impact than the subsidy.<br /><br />Finally, the goal expressed by the state of California is to reach 3,000 MW. The report states that only way to reach this goal is to assume that technological breakthroughs (like thin film or advanced crystalline silicon) lead to a large price reductions in installed cost.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-88880524208702604182007-11-15T07:25:00.000-08:002008-01-02T13:06:44.390-08:00Solar Power in California - Disruptive Opportunity?For the last couple months I have spent some time learning about the solar power opportunities here in California. The market is being fed by two financial engines - (1) The California Solar Initiative (CSI) which is a subsidy program from the state of California and (2) the Federal tax credit (30% for commercial installations) which is scheduled to expire at year end 2008, but many are working to extend this in Congress.<br /><br />There are currently a number of companies that are taking advantage of these programs by offering the consumer what amounts to a fully financed installation by using a power purchase agreement (PPA). The customer pays the vendor (instead of or in addition to to the local utility) and gets a solar power array in return.<br /><br />The interesting dynamic here is that installation and materials costs are widely expected to fall, in a fashion similar to the semiconductor industry. With tech companies like Google jumping into the fray with funding and the stated intention of driving the cost of solar below that of coal, there is almost an incentive for many consumers to wait and see rather than jump in with a commitment to a PPA that could last many years. Maybe a new type of PPA will have to be crafted that takes into account the falling costs (of course, once the array is installed it is a fixed sunk cost, but what if pricing and installation costs fall so quickly and sharply that it is worth removing and replacing the array? What about "upgradeable" arrays? Will companies that can offer this type of technology or agreement have a competitive advantage?).<br /><br />I also wonder if there is an analogy to the PC industry of a few years ago, when prices were falling rapidly and power was increasing rapidly. There the hardware makers had the friendly software makers who were able to give consumers a reason to upgrade to faster machines to run more complex software. Is there an analogy in the PV industry? Rising power costs could be one motivator, I suppose.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-79366249816901665072007-11-02T11:12:00.000-07:002008-01-02T11:54:27.400-08:00Private Equity for Real EstateFor the last year or so I have been working in the world of raising money for investment funds focused on real estate. Primarily we are building a database and calling on university endowments, state and other public pension funds as well as private pension funds (like corporate pension plans). The fund managers that we are raising capital for are all first time managers.<br /><br />The process is an interesting one. There are literally billions of dollars in investment capital available but the pension fund reps are so overwhelmed with inquiries seeking capital that it is very tough to break in a new manager.<br /><br />The system seems very "broken" when you start to learn about it. There are undoubtedly many, many new managers that could produce excellent returns for these pension funds (and given the increasing demands for returns by the funds, they need high returns), but because of the information asymmetry problem (no time to vet new managers or manage the risk inherent in a new manager), few new managers are given a chance.<br /><br />Shouldn't there be some kind of "farm system" for new managers? Something where an investment club of save 5-10 similarly situated endowments or funds like Harvard, Yale, MIT, UC or Calstrs, Calprs, NYSTRS could invest relatively small amounts (say $5M each) and fund a new manager or group of managers? Then as the manager are vetted they can "graduate" to the next level where they have their own fund with larger amounts from each investor? And the investors, for their hard work and risk get the opportunity (and right) to invest in future funds?<br /><br />Seems like technology could also enable this. By having a simple web based management/governance system that goes from gathering initial submissions to monitoring investment performance, you could somewhat automate the process of managing this small program and make it functional for the large funds to try this.<br /><br />There are a couple firms with allocations from Calstrs doing this now - but they are really creating their own fund in cooperation with the emerging manager and taking a piece of the promote -which is not as attractive for the manager, obviously.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-2535334081662570762007-08-07T05:55:00.000-07:002008-01-02T13:05:10.960-08:00Community Reinvestment Act (CRA)Most financial institutions that makes loans to consumers are required to meet a set of federal laws collectively known as the Community Reinvestment Act (CRA).<br /><br />"The CRA was enacted in 1977 to prevent redlining and to encourage banks and thrifts to help meet the credit needs of all segments of their communities, including low- and moderate-income neighborhoods." (from the Office of the Comptroller of the Currency - one of the chief enforcement bodies of the CRA)<br /><br />Most financial institutions satisfy their CRA requirements in two ways: (1) lending to lower income customers or in lower income communities and (2) buying tax credits wherein the proceeds of the tax credit sale go to fund affordable housing.<br /><br />A few (mostly larger) institutions will directly invest in affordable housing and other initiatives that support low and moderate income communities (venture capital targeted at businesses in low income communities is one example).<br /><br />The interesting disconnect in this market comes from the fact that most of the tax credit deals only go to larger institutions because it is just easier to sell the deals (and more deals) to these larger customers. Often the smaller financial institutions get shut out and have a lack of CRA qualifying deals to pick from.<br /><br />The other interesting issue is that the institutions have to meet geographic requirements (invest/lend in their service areas). There can often be an asymmetrical information problem because the institution is not made aware of all the deals in their service area and the entity raising capital doesn't know of all the potential investors/financial institutions who can "get credit" for investing in their deals.<br /><br />To date, there is no central clearing house for this information, nor is there anyway for smaller institutions to band together to go after the "bigger" opportunities, or to directly invest in affordable housing and earn CRA credit (without making a direct loan on a property, which they may consider too risky).Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-27886849412472393482007-06-08T10:49:00.000-07:002007-06-08T10:59:58.014-07:00It's been a long timeDecided to start blogging again. Sold my interest in BetterPPC to my co-founder in October 0f 2006. It was a hard decision for me, but it was the right decision and I think Ben will be very successful with BetterPPC (and he has been doing well since the sale). I wish Ben and the BetterPPC team all the best.<br /><br />Why did I sell my interest? I guess it all comes down to choices and stages of life. I didn't have the passion for running a very small startup with limited resources anymore. I guess to be honest I was "burned out". 2+ years of my life went into BetterPPC and I didn't feel like I had the passion that it would take to push it to the next level. My co-founder did and wanted to do it on his own steam, so the deal made sense and provided me with some reward for all the hard work I had put in.<br /><br />Since then I have been working in real estate finance, mostly because of an opportunity to work with a great team that just happened to come up. I had met the founder and president of the company several years previously and when he found out I was free, he asked me if I would like to give his industry a try. It made sense to me because for a change I would be responsible only for myself and making deals happen, rather than making all the decisions and having all the responsibility inherenet in running a company. So far the experience has been great, I have a background in real estate (I was a commercial broker at the beginning of my career, I developed an industrial park in 1998 before moving into technology and I practiced real estate law as a lawyer), and I have been learning a lot.<br /><br />We work in the areas of structured/secured financing and equity fundraising for institutional investment funds. It has been a kick to work with some of these managers and in some ways the process is very similar to raising VC money for a startup company. You have to have a great idea in a great market, a great team and convince investors that you can execute.<br /><br />I wouldn't be true to my own business theory (and title of this blog) if I didnt' also say that there may be opportunities to disrupt many of the current process in this "tradition rich" industry. Hopefully more on that in more frequent postings in the next year.<br /><br />I still have a passion for technology as well, keeping up with the online ad world, video, social networking, widgets, etc. and can't help myself from looking for opportunities there as well.<br /><br />Finally, I have become completely engrossed by the sport of kite surfing and have gone from a complete beginner to being able to have fun in some pretty heavy conditions. Down right now with a knee injury but that is also a sign to work harder until I heal!Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-34582935730378580862007-06-08T10:27:00.000-07:002008-12-08T18:36:32.929-08:00Posting a Photo<a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://2.bp.blogspot.com/_bDbOHxth9Mw/RmmRq31rZAI/AAAAAAAAAAM/Edn6ZeSoryc/s1600-h/joeag.JPG"><img style="cursor: pointer;" src="http://2.bp.blogspot.com/_bDbOHxth9Mw/RmmRq31rZAI/AAAAAAAAAAM/Edn6ZeSoryc/s320/joeag.JPG" alt="" id="BLOGGER_PHOTO_ID_5073746620939199490" border="0" /></a>Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-1150993378427522072006-06-22T09:21:00.000-07:002006-06-22T09:22:58.466-07:00Google AdSense to add Affiliate Marketing Option - CPASaw this <a href="http://internet.seekingalpha.com/article/12363">post</a> today that some AdSense advertisers have received information about a new alternative to AdSense that is based on cost per action (CPA). This essentially turns AdSense into an affiliate program, where the publisher gets paid on a per lead basis. Some observations:<br /><br />1. This has to be a response to the major click fraud problems that advertisers experience in AdSense and contextual advertising in general;<br /><br />2. Google should do affiliate programs MUCH BETTER than CJ, etc. in terms of payments, reporting, policing the network, etc. so I would agree with the original poster that this is big trouble foor CJ and the other affiliate program providers;<br /><br />3. We always think in terms of optimization, and given that an advertiser can eventually pay for ads through CPM, CPC or CPA, there are that many more opportunities for testing to find the optimal ad, bid and method, so analytics tools will be that much more important.<br /><br />Of course if Google expands the lead generation market even more with this, lead quality measurement will become that much more important, because all the click fraud guys will move to "lead fraud"....Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-1150831268928868752006-06-20T12:16:00.000-07:002006-06-20T12:21:08.956-07:00Update: Help-U-Sell and Yahoo! PanamaLong time since my last post, reflecting many changes at BetterPPC. The highlights:<br /><br />We are now managing over $2.5M in monthly spend, some of the largest PPC advertisers have become customers!<br /><br />We have developed a "packaged click" product that allows small businesses and franchise organization to programatically buy PPC advertising and create coordinated campaigns between the parent company and individual offices. Our first customer in this business is Help-U-Sell(R), a national real estate franchisee with over 800 offices across the country.<br /><br />Yahoo! is now testing their new platform, code name "Panama" and will finally allow multiple ads to be run automatically. We intend to take full advantage of this new functionality and bring the power of BetterPPC to Yahoo!Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-1138481672923652452006-01-28T12:52:00.000-08:002006-01-28T12:54:32.923-08:00Google AdWords Desktop ManagerThe new desktop manager Google has released (beta) is pretty amazing. Combines many of the features of the web interface with the bulk change/uploading features of the API (without having to program to work with the API). <br /><br />If your company is doing basic keyword bid management - this is going to be a serious alternative for the customer.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-1133397428146788622005-11-30T16:17:00.000-08:002005-11-30T16:41:06.710-08:00Google "Beginning of the Backlash?"<a href="http://battellemedia.com/archives/002072.php">John Battelle</a> and <a href="http://avc.blogs.com/a_vc/2005/11/the_worm_turnin.html">Fred Wilson</a> both post today on the beginnings of a percieved backlash against Google.<br /><br />The timing of these types of opinions coming forth and the new AdWords Terms of Service are interesting, and my previous post regarding the new "no 3rd party apps" terms of service generated a lot of comments both here and at the <a href="http://www.betterppc.com/blog/">BetterPPC Blog</a>. Many, many small companies have been working on applications for AdWords that use the API since it was released in January and now are worried that the effort will be for naught.<br /><br />Is Google going to be the next Microsoft, a giant predatory that wants anything and everything for itself and exacts a toll on all connected with it?<br /><br />Or do they intend the more modern (and moderate) approach of encouraging many 3rd party apps to flourish around the search engine and ad platform (and gmail and maps and base and ...). Seems like this would be a more "enlightened" and also more profitable long term approach.<br /><br />As a follow up to this story, the "AdWords Evangelist", Google Employee Patrick Chanezon has posted a <a href="http://adwordsapi.blogspot.com/2005/11/adwords-api-terms-and-conditions-thank.html">response</a> (warning: not very enlightening). Meanwhile the "Commercial API" appears <a href="http://groups.google.com/group/adwords-api/browse_thread/thread/5ce29b31e28a8be9/2a9112d5533e99c8">slated for release</a> on January 1, 2006.<br /><br />Seems ironic now, but we are actually now eagerly awaiting the release of MSN AdCenter and revamping of Yahoo SEM! - let the market forces begin!Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-1132553228010564952005-11-20T21:45:00.000-08:002005-11-20T22:07:08.020-08:00Google's New API Terms of Service - A "Google Economy" or Not?I spent quite a few hours this weekend reviewing the new <a href="http://www.google.com/apis/adwords/terms.html">Google AdWords API terms of service</a>. All I can say is "wow". As pointed out on the <a href="http://groups.google.com/group/adwords-api/browse_frm/thread/b5afb9fcb88eb948">Google AdWords API Developers forum</a>, Google either Google wants to prohibit virtually EVERYONE from using the API (and if so, then why bother developing and releasing it in the first place?) or they have the world's worst lawyers.<br /><br />When you read the agreement, the gist of it is basically this:<br /><br />AdWords advertisers can't use any applications that use the API that have been developed for them by third parties. Advertisers can only use those that are developed for them in house or "custom" built for them. If your app can be sold to more than one customer or is hosted and made available for more than one customer, apparently that is against the TOS. <br /><br />(See Section II, paragraph 2 - "2) <u>Non-Compliant AdWords API Clients</u>. You shall not use an AdWords API Client that violates this AdWords API Agreement. For example, you may not use your Developer Token with an AdWords API Client developed or hosted by a Third Party (excluding an Internal-Use Only AdWords API Client developed for you)."<br /><br />That's it. End of story.<br /><br />Another important part of the backstory on this is that Google has a "My Client Center" Account structure. The MCC is like a master account and the API calls are made through the MCC account, via the MCC Developer token for each account. The cited language above now prohibits this. The problem with putting all customers in the software provider's MCC account is that it then limits the client to using only that provider's software. Currently many advertisers use different software for different functions and this will be impossible under the new terms and conditions.<br /><br /> I found this hard to believe so I called Google and asked if, for instance, AtlasOnePoint would no longer be available to advertisers, and was told no, absolutely not, and that there was no special deal for them or anyone else. The intent of Google is not to prohibit these types of services. The rep I spoke with said someone from the API team would get back to me (but no one has as of yet).<br /><br /><span style="text-decoration: underline;"></span>Other issues for a later post include the fact that Google is going to require extensive Google branding on any app that uses the API, security measures for the data extracted, prohibitions against sharing the data and a paragraph previewing service charges for access to the API. This is especially hard to believe since presumably, any service that uses the API, in order to be commercially viable, would have to help advertisers be better/more efficient at what they do, which would presumably result in more revenue to Google, so why would Google charge for that and by doing so, discourage use of the API. Surely, Google, with all the billions of dollars in the bank, can't be worried about the expense of supporting an API, can they?<br /><br />We'll see.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-1132551858310881712005-11-20T21:43:00.000-08:002005-11-20T21:44:18.320-08:00Blog SpamWow, I guess Google really needs to do some work on blog spam. Nice examples of it in all the comments to my entries.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com0tag:blogger.com,1999:blog-6937463.post-1125330901690285692005-08-29T08:50:00.000-07:002005-12-26T05:33:22.343-08:00Pay 4X Per Click or Optimize Your Ad CopyThat's right, over the last few weeks, Google has implemented a <span style="font-style: italic;">minimum</span> (that's right minimum) bid per click policy for AdWords (and AdSense as well).<br /><br />Now if Google's algorithms determine that the ad you are running on a particular keyword is not generating enough revenue for Google, you have two choices:<br /><br />1. Agree to a proposed minimum bid (which I have personally seen to be 4X or more the amount of the recent average CPC for keyword/ad combo).<br /><br />or<br /><br />2. Change (optimize) your ad copy.<br /><br />Yes, that's right, you have the opportunity to avoid a potential 4X increase in your CPC cost if you create the right optimal ad.<br /><br />It will be interesting to see if even Google (the 800lb Gorilla of all Gorillas) can make this stick, especially with MSN Search launching in a few months.Joe Agliozzohttp://www.blogger.com/profile/04925512414925612743noreply@blogger.com3