Welcome to Grid Brief! Here’s what we’re looking at today: What SunPower’s bankruptcy means for residential solar, how PJM’s power auction will affect Dominion, Debby leaves thousands without power.

What Does SunPower Say About the U.S. Solar Industry?

The residential solar industry was dealt a blow this week when SunPower, one of the most formidable companies in the sector, filed for bankruptcy. While the company had had its share of financial missteps, such as miscounting inventories and investor lawsuits, an unlikely culprit may be to blame: growth.

“The enemy is growth,” said T.J. Rodgers, chief executive officer of Complete Solaria Inc. in an interview with Bloomberg. “Every time [companies] burn money and need more money, the noose gets a little tighter. It’s 2008 in housing again.”

Rodgers says that instead of prioritizing growth and outside funding, the industry should shift its financial model to that of a small business by focusing on fiscal discipline and growing cash flows.

Inflation is also playing a role in the residential solar industry's slump. Higher prices increase project costs and also discourage consumers or businesses from spending extra money on solar upgrades. The same rings true for offshore wind and advanced nuclear, which have both had major projects shuttered due to inflation.

The case of SunPower could just be a blip on the radar or a sign of trouble to come in a world of high inflation and interest rates.

Dominion: Customers Will Be Protected From PJM Rate Hikes

Last week PJM held its power auction, which saw the price for power plants in the RTO jump from $28.92 per megawatt-day to $269.92 per megawatt-day. Exelon has announced that these increased prices will likely lead to a double-digit rate increase for some of its utility subsidiaries.

Dominion has indicated that PJM’s auction will probably not lead to a rate increase for its customers because the utility already owns most of its power generation.

“Higher capacity market prices do not mean the everyday cost of electricity will increase that substantially for our customers. Capacity market purchases account for less than 1% of our customers’ monthly power bills,” said PJM spokesperson Aaron Ruby.

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Conversation Starters

• Tropical Storm Debby drenches East Coast (CNN)

  Debby has produced more than one foot of rainfall in South Carolina, Georgia, and Florida. In the Sunshine State, the storm has left more than 45,000 homes and businesses without power.

• Japan and Australia look to partner on carbon capture (Reuters)

  Japanese utility Electric Power Development has signed a joint study agreement with two Australian carbon capture and storage developers, deepC Store and Azuli, for a strategic partnership. The three companies will look to commercialize a project to capture CO2 in Japan and Australia and store it in Australia.

• AI to help reduce demand on the grid (The Conversation)

  A group of engineers have developed an artificial intelligence system that helps buildings shift their energy use to times when the electric grid is cleaner.

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