Sunrun Reports Sales Rebound After Coronavirus Slump, But Expects Slow Quarters Ahead

U.S. residential solar bellwether Sunrun reported solid business in the quarter that ended with the arrival of shelter-in-place orders. 

First quarter installations grew 13 percent year-over-year, to 97 megawatts. That performance handily beat rival installer Tesla, which managed to install 26 percent less solar in its first quarter compared to Q1 2019.

That said, coronavirus restrictions only impacted the last few weeks of March. The real test will be the second quarter, which has thus far been consumed with social distancing requirements across the U.S.

Prior to the health crisis, the rooftop solar business relied on face-to-face sales and hours spent at customer homes during installation. When coronavirus prompted social distancing orders around the country, Sunrun revoked its business guidance for the year, switched all sales online in a matter of days and launched solar leases for $1-per-month for the first six months of its contract. Wednesday’s quarterly earnings announcement promised the first opportunity to see how those measures are working.

By the end of March, sales were down 40 percent compared to pre-virus levels, CEO Lynn Jurich told GTM. But after switching to digital operations, sales increased week by week and grew to rival or beat pre-crisis levels. That culminated in Sunrun hitting its all-time high for single-day orders in late April.

“There was that initial shock, but it's very clear customers still want [solar],” Jurich said. “In many cases, they may want it more in this type of environment.”

Jurich credited some of that April sales uptick to the company’s new offer of leased solar with six months for $1 each. But she cautioned against extrapolating too much from a few good weeks. After pulling 2020 guidance, the company hasn't offered any new figures on its expectations for 2020. 

“It’s hard to say where things will land, because there’s so many external factors like [authorities having jurisdiction] closures and when do the retail stores open,” she explained. 

Installations are still on hold in New York State and Boston due to local rules, Jurich said. And installations are held up elsewhere by delays for permitting and inspection.

Resilience bump?

Jurich and others in the solar industry have argued that quarantine makes electricity payments and resilience more salient for homeowners. But the situation is new enough that little evidence has emerged to support that assertion.

To test that hypothesis, Jurich suggested watching battery attachment rates in the Bay Area. 

That’s where utility PG&E is gearing up to invoke pre-emptive grid outages to avoid sparking wildfires in the late summer and fall. This year’s shutoffs may be even more impactful  than last year's, due to a dry year and coronavirus-related interruptions to safety preparations. Depending on the course...