Tumult in residential solar

What this episode covers

Julien Dumoulin-Smith, who leads equity research for power, utilities, and clean energy at Jefferies, explains why the residential solar market contracted 31% in 2024 and saw bankruptcies from Sunnova and Mosaic due to high leverage, rising interest rates, and intense competition. He details how the 'One Big Beautiful Bill' phases out tax credits for homeowner-owned systems by 2025, forcing a shift toward third-party leasing which benefits large incumbents like Sunrun over small installers. Dumoulin-Smith argues that while utility-scale solar faces less existential risk from these policy changes, residential solar's viability now hinges on storage integration and the ability of leasing companies to capture market share as direct consumer ownership becomes financially unattractive.