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Guggenheim Solar Index: Solar’s shipment struggle

From pv magazine 08/2021

The Invesco Solar ETF, an exchange-traded fund that tracks the MAC Global Solar Energy Index, underperformed broader markets in July. The Invesco Solar ETF (TAN) decreased 3.0%, while the S&P 500 increased by 1.1% and the DJIA increased by 0.5%. The top five performing solar stocks in the U.S. market were: JinkoSolar Holding Co. (16.9%), Generac Holdings, Inc. (7.5%), Atlantic Sustainable Infrastructure Capital Inc. (3.2%), Daqo New Energy Corp. (2.5%), and Hannon Armstrong Sustainable Infrastructure Capital (1.7%).

The outlook for the U.S. residential market remains strong. According to one industry executive, a key driver behind his expectations for 25-50% growth in 2021 and 40-50% growth in 2022 is the rise of advanced origination platforms. These platforms allow bidding on installations and could make it easier for customers to connect with contractors.

The U.S. utility industry is expected to continue to struggle due to rising input costs. The focus has been placed on 2022 volumes, with companies continuing to delay new contracts while waiting for costs to decline. Shipping costs remain an issue, currently at three to six times the typical price/container of $2,000 to $4,000. The outlook for container prices is unclear, as is the amount of 2022 volume that could get pushed out due to inflated prices.

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It is only a matter of time before a law is put in place banning imports of all products produced in China’s Xinjiang region. And companies are scrambling to figure out the best course of action.

A bill that cuts this region of China out of the solar supply chain will undoubtedly cause supply shortages, price increases, and strain for manufacturers. The Biden administration has shown support and is expected to provide enforcement regarding a bill banning products from Xinjiang. However, there has been a delayed response from the government, which is most likely purposeful to give the industry time to make supply chain adjustments.

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Source: pv magazine