Hanwha has the development capital and balance sheet that financiers look for in a partner. This is a tremendous differentiator given the current market conditions.
Hanwha SolarEnergy America
Matt McCullough | Hanwha SolarOne
What is Hanwha SolarEnergy America’s strategy in this difficult market?
HSEA operates in primarily in markets where power costs are high and solar makes good economic sense. We have both organic development efforts for large scale opportunities and we have a partnership approach with local developers. We have significant efforts in Hawaii, California, the Caribbean and Latin America and we have operations in the eastern U.S. as well. Our growth is accelerating as our market focus, organic development efforts, and partnership approach bear fruit.
What is HSEA’s average project size?
HSEA’s projects range across the wide spectrum of commercial and utility sizes depending on customer industries, although our efforts are migrating to development and EPC efforts into the distributed utility scale market where projects average 2 to 20 MW in size.
Are you focusing on utility, commercial, both?
HSEA develops, installs, finances and operates solar projects in both the utility scale and commercial scale markets. There has been a tremendous amount of activity in the North American utility-scale market in the last few years and we are very active there. We also believe that, as the finance market continues to make capital more available, and as the structures become more efficient, the growth in commercial rooftop solar will grow at a rapid rate.
Is Hanwha SolarEnergy American meant to sell Hanwha SolarOne panels as part of development projects? Do you develop projects without Hanwha SolarOne panels?
We have installed projects both with and without Hanwha SolarOne panels in the past. We see our relationship with HSOL as a key differentiator in the market which can allow us to leverage our sister companies’ and parent company’s strength of balance sheets at a time when many firms are struggling in solar or contracting out of the market. This strength and access to development capital combined with SolarOne’s cost-competitive modules backed by a strong warranty makes HSEA a very attractive partner in these tough times.
Are there any verticals you are targeting over the next few years for growth? (i.e. education, agriculture)
HSEA has a reach into a number of vertical markets, both through its direct origination team and its network of strategic partners who act as co-developers on our behalf. This allows us for a greater reach into very wide footprint. In those areas we look for creditworthy counterparties with investment grade credit or municipal credit. We find those in utility markets, municipal and educational markets, agriculture, and the Federal Government. We are also investing heavily in select emerging markets to capitalize on our ability to execute in multiple geographies at once owing to the financial strength of Hanwha.
What are the biggest hurdles to getting projects over the finish line?
The biggest hurdles we see are access to cost-competitive capital for commercial project and interconnection and permitting delays for utilities projects.
How are you overcoming these hurdles?
We overcome those hurdles by lending our development expertise to the projects. We try to get involved as early as possible in projects to ensure they are properly developed and can be financed. Hanwha has the development capital and balance sheet that financiers look for in a partner. This is a tremendous differentiator given the current market conditions.
Are you offering financing as part of your project development capabilities? If so, what kind of financing mechanisms are you utilizing?
Hanwha offers a full range of financing support for projects from development capital to construction financing, sponsor equity and up to including long-term debt.
How does the Q-Cells acquisition support HSEA’s business strategy?
The acquisition of Q-Cells strengthens our position as the leader in quality in the solar panel field. This is a key factor when it comes to obtaining financing for projects in the constrained tax equity market in the US. The premier reputation of Q-cells products, performance guaranties, and proven track record in actual projects will further elevate HSEA’s ability to offer high-quality projects particularly in the utility-scale segment.
Hanwha Solar has said in the past that it wants to be a top three player in the solar industry. Is HSEA on track to reach that goal on the project development side of the business? How do you see the company changing as Hanwha Solar continues to work towards the goal of being a top three player?
Hanwha is well on its way to being a top 3 manufacturer of solar modules and is well positioned to be a leader in the development side as well. HSEA has the people, pipeline and platform to succeed in this very challenging market of consolidation and contraction. HSEA continues to invest and grow in the Americas and will continue to look for projects and acquisitions that make strategic sense, both in terms of projects and platforms.
About Hanwha SolarOne
Hanwha SolarOne is a global top class renewable energy company listed on NASDAQ (HSOL). It was newly born as Hanwha SolarOne after Hanwha Group took over Solarfun Power Holdings in 2010.
Hanwha SolarOne defines value creation as the development of a revolutionary business model that is based on a full integration of the entire value chain, ranging from polysilicon, ingots, wafers, cells, and modules to project development and project financing backed by other Hanwha affiliates.
Hanwha SolarOne recently entered exclusive partnerships with famous European soccer clubs, Hamburg SV and Bolton Wanderers to promote its brand in major markets aiming to be one of the most popular solar brands around the world.
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