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ALBUQUERQUE, NM – The coronavirus has affected solar businesses in New Mexico in different ways, slowing growth for some while creating new opportunities for others.
Most have emerged from the pandemic stronger than before. But now, with a new solar boom underway, businesses are facing new challenges that reflect the growing difficulties of a burgeoning industry.
Almost every local solar company felt the pinch from COVID when the economy practically came to a halt in April and May. But in the summer, the industry received an unexpected boost from quarantined homeowners who invested additional savings and stimulus dollars in home improvement projects. And as locked-in families blow up their air conditioners, appliances and electronics, many homeowners have taken a new look at solar to offset rising electricity bills, said Jim DesJardins, executive director of Renewable Energy. Industry Association of New Mexico.
“When COVID hit, I thought ‘the industry is going for a while’ but the pandemic has almost had an adverse effect,” DesJardins said. “The impact was unpredictable, with winners and losers. But in general, I think the solar industry has benefited in its own way, as have the renovation and construction industries. “
Companies on the winning side doubled their residential facilities in 2020.
New Mexico Solar Group President and CEO Nick Kadlec said it was a “crazy year,” but a good one.
“We didn’t know when the coronavirus hit in March and April how much it would affect us,” Kadlec said. “But most of our business is focused on the residential market, and it ended up being a banner year for us.”
The solar group’s revenue grew 34% from $ 19.4 million in 2019 to $ 26 million in 2020. And the company has increased its workforce from around 70 in 2019 to 116 now, has declared Kadlec.
Positive Energy Solar, a longtime residential installer launched in 1997, experienced a brief slowdown at the start of the pandemic that lasted a month or two, said company co-founder and chairman Taiyoko Sadewic.
“We came back right away and have been as strong as ever since,” Sadewic told The Journal. “We barely missed a beat, and now we are seeing a trend of good, strong and steady growth.”
Positive Energy has increased its workforce by approximately 25% since the start of 2020 to more than 80 employees. And six more positions are open now, Sadewic said
Manufacturers with a scope
Solar power manufacturing companies with sales in the United States and beyond have been particularly successful.
Albuquerque-based Array Technologies Inc., which makes solar tracking systems for photovoltaic panels, went public on Nasdaq last fall. It reported $ 827 million in revenue for 2020, up 35% from $ 647.9 million in 2019. And it forecasts another 30% jump this year, potentially pushing its annual revenue above $ 1 billion.
Unirac Inc., which manufactures mounting platforms for solar systems, has also had an excellent year, said company CEO Peter Lorenz.
“Overall, we increased our revenue by 30% last year, despite the challenges of the second quarter with COVID,” Lorenz told the Journal. “It was our best year of our life.”
The company, which sells its products in all 50 states and other countries, has grown its Albuquerque workforce from 110 people early last year to 130 now, Lorenz said. It also employs around 130 people in a back-end, research and design office in India, up from around 30 a year ago. And it has just opened a new sales office south of the border which will now focus on the Mexican and Central American markets.
The company – which operates out of two facilities with approximately 120,000 square feet of manufacturing and warehouse space in the Springer Industrial Park north of downtown – has acted aggressively to cut spending to avoid layoffs in the early months of the pandemic, Lorenz said. He temporarily cut staff salaries from 2% to 10%, with executives taking a 50% cut. But in September, those pay cuts were fully reinstated.
“What I’m most proud of is how we got out of COVID with our entire team intact here in Albuquerque,” Lorenz said. “Our local workforce is entirely local. We have internally trained residents of New Mexico. “
During the pandemic, Unirac gave back to the community by donating a $ 100,000 solar system to the Albuquerque Joy Junction homeless shelter which was set up by national firm Sunpro Solar.
Some businesses have not weathered the pandemic as well, especially those that focused on commercial facilities for businesses and buildings. This part of the industry grew in 2020, but at a significantly slower pace than in previous years, according to the National Association of Solar Energy Industries.
Albuquerque-based OE Solar, which focuses heavily on commercial markets, generated around $ 4 million in revenue last year, down 20% to 30% from 2019, said the founder and CEO of the Adam Harper Company.
“Our business facilities have been a huge success,” Harper told the Journal. “Before the pandemic, we had about $ 5 million worth of business projects under development that were just scrapped. They are not necessarily canceled, but pending, and we hope to see them return as the economy recovers. “
Experienced Solar, a small design and installation company launched in 2016, also saw revenue drop by about 15% last year, said company owner Kevin Goodreau. The business closed for about five weeks after the coronavirus hit.
But with the pandemic receding and the economy recovering, all local businesses are optimistic about the current and future prospects.
“The outlook is now great,” said Goodreau. “I think our revenues will increase by 25% to 30% this year.”
‘It’s like a gold rush’
Most solar-related companies now expect a multi-year boom, fueled in large part by favorable state and federal policies to encourage the development of renewable energy.
The industry had faced a two-year crisis in 2017 and 2018, which reduced New Mexico’s workforce from a peak of around 3,000 employees in 2016 to just 2,000 in 2019, according to the latest. Annual census of solar jobs from the Solar Foundation, based in Washington, DC. , released in February 2020.
The Solar Foundation has yet to release new figures on the number of businesses and total workforce currently active in New Mexico. But industry leaders say it is growing exponentially.
“At its peak (in 2016), the industry had over 90 companies in Bernalillo County working across different sectors of the industry,” said OE Solar’s Harper. “Now he’s growing up again. It’s like a gold rush, with even plumbing and heating, ventilation and air conditioning companies.
This “gold rush” phenomenon creates many new challenges and growing difficulties, including bottlenecks in government authorizations and in the approval of applications to connect solar systems to local grids.
Additionally, as residential and commercial demand increases, many areas around Albuquerque and other cities are struggling with the ability to interconnect utilities, preventing many potential solar customers from installing systems on the grid. their homes and businesses.
The Renewable Energy Industry Association is working with utilities, the Public Regulatory Commission, and local and state governments to address these issues, said Sadewic of Positive Energy Solar, who is also chairman of REIA. But as the country now enters a fast track for renewable energy development under the leadership of President Joe Biden, there is an urgent need to find solutions to emerging challenges.
“Parts of Albuquerque, Santa Fe, and Taos are now reaching network saturation,” Sadewic said. “With the country’s plans to convert the transportation system to electric vehicles, this alone could double the size of the grid and distribution system. We need to get ahead of these things as quickly as possible. “