Solar Company Bankruptcy May Bring Renewables Scrutiny

Now that Texas-based rooftop solar company Sunnova has filed for Chapter 11 bankruptcy protection, the company will undergo scrutiny in a federal court, bringing up questions about the company's viability in the energy marketplace.

Houston's Sunnova moved toward bankruptcy court after the Trump administration's Department of Energy last month withdrew a nearly $3 billion loan the company needed as part of its subsidies.

Proponents of both wind and solar power have said both forms of renewable energy are sometimes cheaper than conventional forms of electricity based on the burning of fossil fuels, but can the cost to the public of renewables be compared to other forms of power when the infrastructure of solar and wind is at least partially paid for the by governments to begin with?

"Because of the extraordinary tax incentives and subsidies that have been granted the renewables, wind and solar in particular," a burden is put on these renewables companies to continually seek government help to move forward, according to Texas Alliance of Energy Producers Economist Karr Ingham.

One of the biggest problems facing solar and wind companies is their lack of experience in competing in the open markets.

"The solar industry from the provision of electricity to the residential solar, which is what this is, has really not been connected to markets all along, it's only been able to exist and profit such that it has because of the extraordinary subsidies they've been granted...for years upon years now. In other words, neither of those industries have had to stand on their own merit in the marketplace.

"And by the way, it's not at all made electricity less expensive, it's made electricity even more expensive, even in Texas and virtually everywhere and made it less reliable," says Ingham.

More than energy expert has said that wind and solar has often appeared to be one giant wealth transfer from governments to private industry, but with the problems recently plaguing the door-to-door rooftop sales business, the renewable energy industry may find itself under deep scrutiny during and beyond the Sunnova case.

"Even the renewables guys can't say with a straight face that this makes electricity to consumers more available, more reliable, and less expensive," Ingham says.


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