REFocus: Are you having a good show?
Jamie Evans: Yes! It’s been a very busy, productive week for us as we continue to educate the market on the types of projects and partnerships that make sense for Panasonic. This year, probably more so than past years, there seems to be more project-oriented discussions, more tactical, near-term opportunities that people are discussing. Project managers are looking for partners, investors are looking to deploy capital, etc. Generally speaking, the mood at the show has been very positive compared prior years, where many of the discussions were more strategic and less certain.
REFocus: In your conversations with potential clients, what are some of the strengths that you hope to convey?
Evans: Our model at Panasonic is what we call and
“end-to-end solution,” whereby we participate in various projects from origination and development all the way through engineering, construction management, integration, construction financing, permanent financing (through our platform at Coronal), as well as then the long-term service and maintenance for the duration of the asset life. We focus primarily on the ‘middle” market: commercial and industrial distributed generation projects as well as small utility projects. We’re not really active in residential solar, nor or we doing the massive utility-scale projects.
We believe we offer an efficient and a simplified model when talking to our development partners, customers, whether they are corporate, municipalities, school districts, non-profit organizations, utility project managers and investors.
REFocus: Do you consider that strategy a competitive advantage?
Evans: We like to think so. We try to offer that part of the market a very simple, end-to-end model where the energy asset is essentially fully engineered, implemented, maintained and backed by Panasonic, an $80 billion global electronics company. In this business Panasonic is not driven by product mandate; globally we have 900W of module manufacturing capability, but in our Solutions business here in the US we have no obligation or mandate to use those products. This way we can focus more on optimizing the engineering, system design and financial structure around that.
REFocus: You mentioned the ‘Coronal’ platform. Can you elaborate?
Evans: Sure. The Coronal platform is a ‘captive’ financing vehicle for Panasonic Eco Solutions. They arrange the financial structures and permit financing for assets and buildings maintained by Panasonic. Historically, each development phase suffered from misaligned interests which increased costs and hindered project success. In partnership with the alternative energy experts at Coronal Group, Panasonic brings the whole solar project under one roof with a streamlined end-to-end solution in the commercial, industrial, municipal and small utility markets. The Panasonic/Coronal model delivers a simple, comprehensive solution ensuring attractive and reliable benefits. This adds another element of efficiency and reliability in terms of our ability to execute on the projects.
REFocus: Where are you focusing your efforts?
Evans: Most of our business over the past few years has been in the US, but we are also expanding into Canada as well as select parts of the Latin American market. We are also broadening our technical capabilities beyond the core solar business and looking at more storage solutions and battery applications. We’re starting to integrate some of those products as well as the engineering expertise and capability into our solar solutions.
REFocus: Is that primarily in response to consumer demand, or is it the natural evolution of the model?
Evans: I would say it’s a bit of both, actually. There’s a lot of focus, attention and dialogue in the market right now on integrating storage with solar, EV charging capability, grid stability at larger scale. There are a lot of pilot projects out there, although it’s happening more at the residential level. But we think there’s a big opportunity the commercial, industrial and small utility markets. We’ve seen interest in demand from various customer segments, and it changes both the technical and economic proposition. Given our battery expertise, globally in manufacturing in R&D and engineering, it’s a natural extension/evolution of our current platform.
REFocus: Does this platform work better in some markets vs. others, i.e., internationally?
Evans: There’s a wide range of elements to consider and evaluate — including the broader energy business —when looking to expand into other geographies. These range from: utility regulations, contracts, legal structures, transmission distribution issues, tax structures, solar resources, the various types of incentives and other programs, whether you’re competing directly with the grid, etc. But most of those areas [of interest] are located in markets where Panasonic has an existing presence, corporate relationships or resources — perhaps not in our Eco business, but other industrial products.
REFocus: Beyond Canada and Latin America, what are some of the regions you are targeting?
Evans: In the US and internationally, we continue to look at regions that could become more attractive from a development standpoint — whether that’s an area where new incentive programs are coming online or regions that are seeing decreasing capital costs.
On the whole, our Eco Solutions business is a very large in Japan, especially when you consider our range of products (solar modules, HVACs, lighting controls, building management systems). That business is active in many parts of the world, but mostly in a more traditional product distribution/product sale model. We’re interested in looking at some of those markets where we have an existing Eco presence and trying to do an evaluation that’s similar to what we’re doing, say, in Latin America. In other words, where could this Eco solutions model — which has been focused mainly on the US — be replicated elsewhere?
REFocus: So this could potentially become a larger portion of your business in the future?
Evans: Absolutely. More broadly, globally our Eco Solutions business — which is headquartered out of Osaka, Japan — represents almost 25 per cent of Panasonic’s top-line revenue. So it’s a significant business for us globally and for a company that most people still associate with consumer electronics.
We continue to look at opportunities where can we create a derivative structure that brings more engineering, integration and financial services to the table. That, combined with Panasonic’s own sustainability initiatives, should lend more opportunities from a geographical and a product perspective to expand our solutions.
REFERENCES
- A division of Panasonic Corporation of North America, Panasonic Eco Solutions is a leading green innovation company providing customized, integrated renewable energy solutions for customers in both the public and private sector.