California’s New GHG Reduction Target Is A Huge Boon For The Solar Industry

Summary:

  • Governor Jerry Brown accelerated California’s effort to slash greenhouse gas emissions Wednesday, ordering his state to cut carbon emissions by 40 percent below 1990 levels by 2030. California’s goal to reduce GHGs by 40% in a mere 15 years is the most ambitious GHG reduction goal ever in North American history, and will have enormous positive implications for the solar PV industry.
  • In order to realistically meet this goals, an enormous amount of renewable incentives/subsidies would likely be put in place, with solar PV best positioned to take advantage of this. While the entire renewable industry will benefit, from wind, geothermal, etc, solar PV will likely gain the most from Governor Jerry Brown’s new environmental decree. Any such policy changes in California have a disproportionate effect on the U.S. solar industry, as California’s solar market accounts for the majority of the entire U.S. solar market.
  • Leading U.S. solar companies should benefit tremendously from California’s new GHG reduction target, as a huge percentage of these companies’ businesses come from California.
  • While the valuations of solar companies could plummet if solar PV technologies do not advance as quickly as expected, this is highly unlikely given the inherent nature of semiconductor technologies.

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