TODAY’S STUDY: Businesses Still Buying Solar Bigtime

Solar Means Business; Tracking Solar Adoption by America’s Top Brands

July 2019 (Solar Energy Industries Association)

Key Findings

• Accounting for both on-site and off-site projects, Apple is the top U.S. corporate solar user with 393 megawatts (MW) installed, after adding 130 MW in 2018.

• Amazon moves into the second spot with 330 MW installed, an increase of 36 MW from 2017.

• Target rounds out the top three with 242 MW installed, while retaining the top spot for on-site installations at 230 MW.

• 2018 ranks as the second-largest year for commercial solar installations, with 1,144 MW installed.

• More than half of all corporate solar capacity has been installed in the last three years.

• With more than 7 gigawatts (GW) installed across 35,000 installations, corporate solar deployment is 23 times larger today than it was a decade ago.

• The systems tracked in this report generate 10.7 million megawatt-hours of electricity annually, enough to power 1.4 million homes.

• The solar generation from these systems offsets 7.5 million metric tons of CO2 every year, equivalent to taking 1.6 million cars off the road.

• Growth in corporate solar demand has been led primarily by declining prices, which have fallen by 63% over the last decade.

• Off-site corporate procurement is growing rapidly. The 1.5 GW of off-site systems installed since 2014 represent nearly a third of all installed commercial capacity over that time period. • Nearly 4 GW of new off-site corporate projects have been procured over the last 18 months.

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• The future is bright for commercial solar:

• Reductions in module tariffs will remove a major distortion in hardware costs.

• Continued rapid growth in corporate off-site and community solar is expected.

• Price declines for solar + storage will open market opportunities for more companies.

• Demand will be led by continued corporate commitments for 100% renewable energy.

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America’s Top Corporate Solar Users

Top 25 Corporate Users by Total Installed Solar Capacity

• Counting both on-site and offsite capacity, Apple takes the top spot with 393 megawatts (MW) of solar installed, marking the first year a company in the tech space sits atop the leaderboard.

• With its mixture of installations on Fulfillment Centers and several large off-site projects in Virginia, Amazon takes second place.

• Former champions Target and Walmart continue to increase their solar investments and remain in the top 5, followed by data center builder Switch with 179 MW of off-site solar in Nevada.

• 15 of the top 25 corporate solar users are part of the Fortune 500 rankings, along with 30 of the top 50

Top 25 Corporate Users by Installed On-site Solar Capacity

• Looking only at on-site solar installations, Target claims the top spot for the third year in a row, extending their lead by more than 20 MW. • Walmart has ranked first or second for onsite installations every year since this report debuted in 2012. • Prologis continued to add solar to their properties in 2018 while fellow Real Estate firm Brookfield acquired GGP Inc. to further expand its solar portfolio.

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Top 25 Corporate Users by Number of Solar Installations

• Target and Walmart continue to pace the field for number of individual solar installations. • Fellow retailers Walgreens, Kohl’s and Macy’s round out the top 5, making use of their hundreds of rooftops nationwide.

• Most companies on this list utilize mid-sized rooftop systems to achieve their solar goals, in contrast to the large ground-mounted systems used by companies at the top of the overall rankings.

Top 25 Corporate Users by Solar Capacity Installed in 2018

• Apple takes the top spot for 2018 installed capacity in addition to the overall rankings, attributable to a 130 MW off-site project that came online in California.

• Similarly, Solvay, Fifth Third Bank, Paypal, Digital Reality, Wynn Las Vegas, and Facebook all saw large off-site projects come online in 2018.

• Amazon installed the most on-site solar in 2018 with 36 MW deployed.

• Target saw 27 MW of onsite installations in 2018, coupled with 13 MW in new community solar.

Top 10 Corporate Users by Percentage of Facilities with Solar

• IKEA has led this category since the first edition of this report, as they continue to work towards renewable energy solutions for each of their properties.

• Cosmetics manufacturer L’Oreal follows closely behind IKEA with solar supporting operations at 16 of their 22 U.S. locations.

• While they are not listed here, hundreds of small businesses across the country have solar on 100% of their facilities…

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Commercial Solar Prices Continue to Decline

• Based on the data collected for this report, the price to install an on-site commercial system has dropped by nearly 63% over the past decade. Similar price declines are seen across all system sizes.

• Price declines have been driven by reductions in the cost of panels and other hardware, but also by improvements in labor efficiency and company overhead as markets become more competitive.

• Tariffs on imported panels have slowed price declines since their announcement in 2017, driving domestic module prices $0.12 $0.13/watt higher than global prices…

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Looking Ahead

• The Non-Residential solar market (including commercial, non-profit and community solar) is expected to decline 14% in 2019 as key state markets in California and Massachusetts continue to transition to new rate designs and incentive structures, and community solar deployment in Minnesota slows. Still, the market should see a top-three year for deployment.

• Growth is expected to resume in 2020 as module tariff reductions and ITC demand pull-in help to boost growth. Full ITC draw-down in 2022 causes market to flatten relative to what would be expected from an ITC extension. The growth of community solar programs in the outyears helps to mitigate ITC losses.

• Additionally, off-site corporate solar growth (not included in this chart) is expected to increase rapidly, with 3.3 GW procured in 2018 alone and an additional 500 MW announced in the first half of 2019. Starting in 2020, off-site corporate installations could represent more than 1 GW in deployment annually.

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Challenges and Opportunities for Commercial Solar

Challenges

• Solar module tariff will raise domestic prices and prevent full realization of market potential through 2021

• Declining state-level incentives in many markets

• Less attractive rate design

• Ramp-down of federal solar Investment Tax Credit scheduled to begin in 2020

• Move from early adopters to mainstream commercial consumers in established markets; customer acquisition issues

Opportunities

• Continued price decline opportunities, especially in permitting and inspection costs, which are among the highest in the world

• Increased electrification pushing wide variety of companies to think differently about electricity

• Decreasing costs of solar + storage create resiliency options, new revenue streams

• More large corporates committing to 100% renewable energy

• Increasing flexibility in pursuing large off-site projects as states, utilities and financial institutions lower barriers

• Many state markets remain untapped, creating growth potential as solar installer landscape becomes increasingly competitive

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