SunEdison

Main line of activity – Delivering solar electricity/ solar energy services

Sun Edison LLC owns and operates power plants in North America and provides solar-generated energy to commercial, government, and utility customers. The company provides solar energy services, which include renewable power, monitoring, marketing, renewable portfolio standards, and solar tariff services. 

Sun Edison offers the following solar energy services:

  • Solar Power is their most comprehensive flagship service for customers that want solar-generated electricity without capital costs. 
  • Production Assurance services for customers who already own PV systems but would like scheduled service and maintenance in addition to solar monitoring capabilities.
  • Solar Energy Monitoring offers monitoring and the option for service dispatch for existing PV systems.

In North America alone, SunEdison has:

  • More than 135.7 MW of solar energy capacity       
  • 401 operational sites to date       
  • 419,499 MWH delivered              
  • More than 527,687,523 lbs of CO2 abated             
  • We have developed an additional 6.2 MW outside of North America.

They've deployed over 400 solar power systems around the globe and have produced over 419,643 MWh of electricity. 

Market Segments

World-class organizations benefit from SunEdison® services and solar power systems, including: Anheuser-Busch, City of San Diego, Kohl's, Progress Energy, Staples, Xcel Energy, U.S. Department of Energy. Some of their client lists include Staples, Costco, Whole Foods Market and California State University at Chico. 

Locations 

Sun Edison LLC is headquartered in Beltsville, Maryland with additional offices in Denver, Colorado and San Clemente, Sacramento, and Ontario, California. 

Founder 

Sun Edison LLC was founded in 2003 by Jigar Shah. Mr. Shah is no longer with SunEdison but remains a major shareholder. 

CEO Jigar Shah, 36, launched the company in 2004 with his winnings from a Harvard B-school business-plan contest, and two years later got $26 million in venture money from a group led by Goldman Sachs. That plan became the basis of the SunEdison business model: Simplify solar as a service. This model changed the status quo, allowing organizations to purchase solar energy services under long-term predictably priced contracts and avoid the significant capital costs of ownership and operation of solar energy systems. 

Shah is an expert on energy project finance, changing energy policy, working with entrenched stakeholders, convincing different type of customers to embrace energy technology. Today, Shah works closely with some of the world’s leading influencers and guides policy makers around the globe on key issues surrounding renewable energy, global warming and sustainability. Shah holds a BS in Mechanical Engineering from the University of Illinois, Champaign-Urbana, and an MBA from The University of Maryland. He sits on the boards of the Prometheus Institute and Greenpeace USA. 

Shah has moved on and now runs an organization called Carbon War Room, founded by the chairman of Virgin Group, Richard Branson. 

Business Model 

We bring together customers who want solar on their rooftops with investors looking for a safe, tax-advantaged investment. Customers sign ten- to twenty-year contracts and agree to lock in their electricity prices and buy all of the power generated off of their rooftops. The investor receives several federal tax credits available for solar investments, and at the end of five years can choose to keep or sell the system to other interested investors. The solar systems are covered under warranty by the manufacturer, such as BP, Sharp, or Kyocera. 

What is unique about their business model 

SunEdison isn't so much an idea as it is a solution to a long-standing problem: how to mitigate the high up-front capital costs and transaction headaches associated with buying solar electricity. There are plenty of commercial and municipal customers out there interested in buying solar power, but they don't make the move because they don't want to have to shop around for systems, contract their own installation and, essentially, pay for twenty years of electricity costs today. 

SunEdison was started to simplify solar for those same customers by being a one-stop shop. They develop the project, manage the process, put the solar system on the customer's roof and sell them the power from it for less than what they'd be paying for utility power, without their having to own the system or finance the cost.

They have an "everybody wins" model, because customers get their green power at a good price, they don't have to put any capital down, solar panel manufacturers and installers find new customers, their investors get a solid return, and they diffuse a technology they think is important for society and the environment. Plus, they’re bringing back a lot of the excitement about solar power that's been missing over the years. 

Major inflection points 

  • SunEdison has over 52 MW of hands-on installation experience and over 31 MW under management.
    • In January 2008 SunEdison started construction of seven megawatts (MW) of photovoltaic (PV) solar power plants in Spain.
    • In December 2007, SunEdison completed an 8.22 MW, 80-acre (320,000 m2) solar power system in Colorado.
    • In November of 2009, SunEdison was purchased for 400 million dollars by MEMC Electronic Materials.

SunEdison – now a subsidiary of MEMC 

Thanks to this promising growth, Jigar Shah in November 23, 2009 sold for 315 million U.S. dollars SunEdison to MEMC, a manufacturer of semiconductors and solar panels based in Missouri. MEMC, a global leader in the manufacture and sale of wafers and related intermediate products to the semiconductor and solar industries, pioneered the design and development of wafer technologies over the past 50 years. With R&D and manufacturing facilities in the U.S., Europe and Asia, MEMC enables the next generation of high performance semiconductor devices and solar cells. With the acquisition of SunEdison, MEMC is now a developer of solar power projects and North America's largest solar energy services provider. 

With one of the strongest brands in solar, SunEdison will continue to operate with the SunEdison name, as a subsidiary of MEMC. 

MEMC's common stock is listed on the New York Stock Exchange under the symbol "WFR" and is included in the S&P 500 Index. For more information about MEMC, please visit www.memc.com. 

SunEdison PV plant, Rovigo, Italy – largest of its kind in Europe

SunEdison Renewable Energy (SRE) is building a photovoltaic plant in Rovigo in north-eastern Italy. The plant will be operated by SunEdison Italy and owned by First Reserve in partnership with Spanish private equity firm Banco Santander. The 70MW plant is expected to be the largest of its kind in Europe. The estimated investment is €200 to €250m ($271 to $339m).

Construction of the plant began in March 2010 after the Italian Government gave its final approval. The solar power plant will reduce carbon dioxide emissions in the region by 40,000t per year, which is equivalent to taking 8,000 cars off the roads.

The plant is one of Italy's largest installations and will produce enough energy to light 16,500 homes. 

In October 2010, SunEdison sold the plant to First Reserve for €276m ($382m). First Reserve had made an initial payment of €46m in May 2010 for a stake in the plant. It will make the remaining payment when the plant is interconnected in the fourth quarter of 2010. SunEdison will continue to operate the plant once the acquisition is complete. 

SunEdison Will jointly develop a 15 MW project in Gujarat with Azure Power

SunEdison, North America's largest solar energy services provider and a subsidiary of MEMC Electronic Materials (NYSE: WFR), today announced its partnership with Azure Power, the developer and owner of India's first privately operated, utility scale, solar power plant. SunEdison will jointly develop and construct a 15 Megawatt (MW) photovoltaic solar power plant in Gujarat, with Azure Power. As part of the arrangement, SunEdison will supply monitoring technologies at cost to Azure for projects up to 25 MW. 

SWOT Analysis

Strengths - Acquisition by MEMC; Wide range of solar energy solutions

Weaknesses - Challenging business model; Lack of diversification

Opportunities - Expansion plans; Go Solar campaign in California 

Threats - Government regulations; Intense competition

 

References: 

http://hbswk.hbs.edu/archive/4157.html

http://www.slideshare.net/Alex.Osterwalder/a-business-model-for-solar-energy-sunedison-3319168

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