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It’s another bad day for the renewable energy business.
The ill tidings started early Friday morning with SolarEdge, a company that primarily sells inverters, which convert the electricity produced by a solar panel into the kind that can be used in homes.
In an unexpected announcement, SolarEdge’s chief executive Zvi Lando said that, in the third quarter, the company had “experienced substantial unexpected cancellations and pushouts of existing backlog from our European distributors.” Many of its core financial metrics, including revenue and operating income, would fall below the low end of the range it had projected earlier, SolarEdge warned. The company also said it expected “significantly lower revenues in the fourth quarter.” (SolarEdge is based in Israel but the company said that the Hamas-Israel war was not related to their financial troubles.)
Investors promptly panicked, selling off the stock and sending it down 27% in trading Friday afternoon.
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Other solar stocks were also down. Enphase, another solar services and inverter company, tumbled 14%. Sunrun, a residential solar systems company (which means it actually installs panels), was down 6%. Shares in SunPower, a competitor to Sunrun, were down around 9%.
With today’s trading, SolarEdge has fallen more than 70% in the past year. And those other companies aren’t too far behind — they’re all down around 50% to 67% on the year.
The worry is that the problems SolarEdge identified are not unique to the company itself or even the inverter business, but to the solar industry as a whole.
The company said that its European business had both a pileup of inventory and “slower than expected installation rates,” specifically “at the end of the summer and in September where traditionally there is a rise in installation rates.”
In a note to clients earlier this week, Citi analyst Vikram Bagri noted that downloads of solar apps in Europe, which can be used as a proxy for sales, “declined sequentially … in September, we typically observe sequential acceleration in downloads exiting the seasonally slower August period.”
But Friday’s troubles were not restricted to solar.
In New York, the offshore wind business took another hit from the state government. Governor Kathy Hochul, a Democrat, vetoed a bill passed this summer which would have kickstarted the regulatory process necessary to connect a transmission cable from the planned Empire Wind 2 project on the south shore of Long Island to a substation in Island Park, which is just slightly inland.
In her veto message, Hochul said that the onus was on Empire Wind 2’s developer, Equinor, and other companies in the offshore wind business “to cultivate and maintain strong ties to their host communities throughout the planning, siting, and operation of all large-scale projects,” adding that the Long Beach city council did not support using the beach for the project.
Wind projects are no stranger to local opposition — hostility to such projects on land actually increased between 2000 and 2016. Proponents of offshore wind thought that they could avoid this type of local opposition because the planned projects are out to sea, typically out of sight from residents, but the infrastructure necessary to bring the power generated offshore to homes and businesses still requires building transmission cables and substations on land.
The planned Empire Wind 2 would have 1,260 megawatts of capacity to serve downstate New York, the most populous region of the state and one that depends largely on fossil fuels for electricity generation. State law mandates that New York as a whole generate 70 percent of its electricity by 2030, but that goal will be imperiled if renewable energy projects aren’t built to serve the New York City area.
“The veto of ‘The Planned Offshore Wind Transmission Act’ undermines New York’s commitment to the energy transition and the role offshore wind must play in achieving the state’s renewable energy mandates. This decision sends another troubling signal to renewable energy developers following last week’s action by the New York State Public Service Commission,” Molly Morris, the president of Equinor Renewables America, told me in an emailed statement.
Hochul’s veto came a week after the state’s utility regulator refused to adjust contracts for renewable projects, including four offshore wind projects, after companies saw much higher costs than expected.
And those higher costs aren’t just in offshore wind. The entire renewables sector is in trouble, at least for now.
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The spinoff of Lawrence Livermore National Lab has a new 10-point plan to get onto the grid by the 2030s.
One of fusion energy’s newest startups, Inertia Enterprises, is betting that the fastest route to commercial fusion runs through one of the field’s oldest ideas. The company, which raised a $450 million Series A earlier this year, plans to build a power plant based on the laser-driven fusion system pioneered at Lawrence Livermore National Laboratory’s — the only tech yet to have produced more energy from a fusion reaction than it took to initiate it. Now, Inertia has shared its commercialization roadmap exclusively with Heatmap, detailing the 10 near-term capabilities it must demonstrate before this landmark experiment can become a grid-scale power plant by the mid-2030s.
The roadmap offers a route from the national lab’s impressive but commercially impractical fusion demonstrations to an economical power plant capable of producing electricity for the grid. At its core are a set of milestones — mostly aimed at developing cheap, mass-manufacturable components — that Inertia says it must clear before those individual systems can be integrated into a working plant. This road is not necessarily linear, however, as various teams will likely be working on many of these goals simultaneously.
At least the physics of Inertia’s approach are already proven, the startup’s CEO Jeff Lawson told me, pointing to the fusion experiments at Lawrence Livermore’s National Ignition Facility as a proof-of-concept. The lab’s demonstration of net energy gain caps more than six decades and $30 billion (in 2026 dollars) of U.S. fusion research. The remaining challenges, he argued, are all engineering-related, requiring “elbow grease, hard work, and smart people” rather than breakthroughs in fusion science.
"It seems to us like a startup or a commercial company of any variety should be focused on commercializing a proven scientific result, as opposed to actually trying to demonstrate the basic science to begin with," Lawson told me. Basic science, he argues, is better left to national labs and universities, where researchers can pursue "unbounded problems" that don’t align with the expectations and timelines of venture-backed startups.
Indeed, no fusion startup has yet achieved scientific breakeven, the milestone Lawrence Livermore first hit in 2022, and has since repeated numerous times. But leading players such as Commonwealth Fusion Systems and Helion Energy maintain that it’s only a matter of time before they validate the physics behind their own reactor designs, which they claim will be highly cost-competitive.
Lawson, on the other hand, readily acknowledged that Lawrence Livermore’s tech is uneconomical in its current form. His bet is simply that the more predictable path to a commercial reactor is to drive down the cost of the lab’s validated fusion approach, known as inertial confinement. This system relies on high-powered lasers firing at a millimeter-scale pellet of fusion fuel, compressing it to extreme temperatures and pressures until the atoms fuse. Today, the National Ignition Facility makes each individual fusion target by hand, a workable solution given that it only uses about a dozen per year.
That production model, however, isn’t remotely plausible for a grid-scale power plant. Because each fusion reaction lasts just a fraction of a billionth of a second, a commercial facility must fire its lasers at a fresh target about 10 times per second to generate continuous electricity — requiring the production of hundreds of millions of targets each year.
Scaling production to roughly a million pellets per day and making them inexpensive enough for commercial operation without compromising the strength or precision required for fusion ignition is central to Inertia’s roadmap. That includes goals five, seven, eight and nine — industrializing the manufacturing of the carbon shells that hold the fusion fuel, making the thin films that hold those carbon shells both durable and cheap, scaling up and automating fusion target assembly, and speeding up how fast targets are filled with the requisite deuterium-tritium fuel.
The other central focus of the roadmap is the laser system, which will ultimately consist of 1,000 individual units operating in concert to compress and heat the fusion fuel. Key priorities include reducing the system’s cost (goal two), dramatically increasing its firing cadence (goal three), and bolstering its durability to withstand high-intensity operations (goal four). Goal six also complements these efforts, calling for the development of a control system capable of tracking moving fusion targets to precisely align each laser shot.
Goals one and 10 bookend the journey with some broader milestones. The first focuses on increasing the fusion target’s energy gain — the ratio of fusion energy produced to laser energy delivered — to more than 25 times ignition. Today, the National Ignition Facility’s best-performing laser shot has yielded a gain of just over four times what it took to start the reaction. Goal 10 then zooms out to the ultimate objective: integrating all these technologies into a commercially viable power plant that can deliver either electricity or industrial heat to end customers.
To reach that point, Inertia has embarked on an industrial engineering hiring spree, recruiting folks with experience taking complex hardware systems from prototype to mass production, “not unlike the processes that are used in the semiconductor or consumer electronics world,” Lawson explained. The company has been making progress on its component development goals since the beginning of the year, he told me, and expects to announce the successful demonstration of a few of these milestones in the coming months. Lawson ultimately expects Inertia to complete the core components of its laser and target manufacturing systems by the middle of next year.
The team will spend the next two to three years integrating these individual pieces into two fully operational subsystems, a prototype laser system and a target manufacturing line. Around 2030, the company will begin combining those subsystems into a first-of-a-kind fusion power plant, which will also serve as the proving ground for the target chamber, tritium fuel breeding system, and power conversion system that turns fusion heat into electricity. By the middle of the next decade, Inertia aims to be generating power from this first plant, setting the stage for the company to build and connect additional grid-scale commercial power plants.
There are plenty of engineering trade-offs that the company will have to solve for. Take the decision around how to size the target chamber, for example. “If you make it bigger, your walls have an easier time and survive longer, but it’s more expensive. If you make it smaller, your walls have a tougher time because they’re closer to all the heat and energy that the fusion reaction is creating, but now your power plant costs less to build.”
But to Lawson, this represents exactly the type of problem Inertia was built to solve: complex engineering issues that come to the fore once scientists have demonstrated the fundamental physics are sound. He thinks other fusion companies may someday reach this stage, as well — though he’s unwilling to hazard a guess on exactly what approach or startup is best positioned to do so.
“There have been generations of scientists who’ve made their predictions about fusion energy and gotten it wrong,” he told me. “I’m not going to pretend to be smarter than them. All I’m here to say is, just knowing that one did work, we can commercialize it.”