Enphase CEO says solar industry poised to rebound on falling interest rates and rising utility costs
Rafael Henrique | Lightrocket | Getty Images
Enphase Energy sees light at the end of the tunnel this year for the solar market after the industry has taken a beating from high interest rates.
High rates have depressed demand for residential solar installations in 2023, leaving companies such as Enphase saddled with too much inventory. Enphase manufactures inverters that convert solar energy into electricity that is compatible with the grid.
CEO Badri Kothandaraman is forecasting the company will see a bottom in the first quarter this year and then start to recover in the second quarter as a stuffed inventory channel is cleared.
Kothandaraman said rising utility rates combined with falling interest rates should also provide tailwinds this year.
“Make no mistake, utility rates are going up,” Kothandaraman told CNBC in an interview. “The interest rates are not going to be staying the same. People are finding better financial instruments like third-party leases.”
“All of those won’t move the market overnight but they are all steady steps to make sure that the industry will grow long term,” he said.
Enphase, YTD
Enphase shares soared more than 17% Wednesday despite the company reporting fourth-quarter earnings and revenue Tuesday afternoon that missed Wall Street estimates.
Enphase’s net income dropped 86% to $20.9 million in the fourth quarter compared to the year-ago period. The company’s revenue was down 58% to $302 million compared to the same quarter in 2022.
But Kothandaraman’s forecast that the solar market is on the road to normalization is lifting not just Enphase’s stock, but also the industry more broadly. The Invesco Solar ETF rose more than 5% in Wednesday afternoon trading.
Shares of Enphase’s competitor SolarEdge jumped more than 13%. The residential solar installers Sunnova and Sunrun were up about 14.5% and 5.2%, respectively.
Wall Street analysts’ reaction to Enphase’s earnings were mixed despite the stock rallying Wednesday. Bank of America’s Julien Dumoulin-Smith slashed his stock price target for Enphase by $3 to $69, which implies 31% downside from the company’s Tuesday close of $100.51.
“With limited visibility to a full recovery, we remain cautious on the outlook,” Dumoulin-Smith told clients in a Wednesday morning note.
Oppenheimer analyst Colin Rusch upgraded Enphase to outperform with a price target of $133, implying 32% upside from Tuesday’s close.
“While we expect ongoing volatility in shares, we are upgrading as we believe downside scenarios will now be fully built into expectations,” Rusch told clients in a Wednesday note.
— CNBC’s Pippa Stevens contributed to this report.
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Environment
U.S. crude oil falls below $60 a barrel to lowest since 2021 on tariff-fueled recession fears
A view shows disused oil pump jacks at the Airankol oil field operated by Caspiy Neft in the Atyrau Region, Kazakhstan April 2, 2025.
Pavel Mikheyev | Reuters
U.S. oil prices dropped below $60 a barrel on Sunday on fears President Donald Trump’s global tariffs would push the U.S., and maybe the world, into a recession.
Futures tied to U.S. West Texas intermediate crude fell more than 3% to $59.74 on Sunday night. The move comes after back-to-back 6% declines last week. WTI is now at the lowest since April 2021.
Worries are mounting that tariffs could lead to higher prices for businesses, which could lead to a slowdown in economic activity that would ultimately hurt demand for oil.
Oil futures, 5 years
The tariffs, which are set to take effect this week, “would likely push the U.S. and possibly global economy into recession this year,” according to JPMorgan. The firm on Thursday raised its odds of a recession this year to 60% following the tariff rollout, up from 40%.
Fueled by incentives from the Illinois EPA and the state’s largest utility company, new EV registrations nearly quadrupled the 12% first-quarter increase in EV registrations nationally – and there are no signs the state is slowing down.
Despite the dramatic slowdown of Tesla’s US deliveries, sales of electric vehicles overall have perked up in recent months, with Illinois’ EV adoption rate well above the Q1 uptick nationally. Crain’s Chicago Business reports that the number of new EVs registered across the state totaled 9,821 January through March, compared with “just” 6,535 EVs registered in the state during the same period in 2024.
Those numbers represent more than 50% growth in EV registrations – far beyond the expected 12% first-quarter increase nationally being projected by Cox Automotive. (!)
What’s going on in Illinois?
While President Trump and Elmo were running for re-election, they campaigned on the threat promise of canceling the $7,500 federal tax credit for EVs. Along with California Governor Gavin Newsom, Illinois’ Governor JB Pritzker made countermoves – launching a $4,000 rebate for new electric cars and up to $1,500 for the purchase of a new electric motorcycle.
At the same time, the state’s largest utility, ComEd, launched a $90 million EV incentive program featuring a new Point of Purchase initiative to deliver instant discounts to qualifying business and public sector customers who make the switch to electric vehicles. That program has driven a surge in Class 3-6 medium duty commercial EVs, which are eligible fro $20-30,000 in utility rebates on top of federal tax credits and other incentives (Class 1-2 EVs are eligible for up to $7,500).
We covered the launch of those incentives when the program was announced at Chicago Drives Electric last year, but the message here is simple: incentives work.
SOURCES: Chicago Business, Ray Cunningham; featured image by the author.
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The electric construction equipment experts at XCMG just released a new, 25 ton electric crawler excavator ahead of bauma 2025 – and they have their eye on the global urban construction, mine operations, and logistical material handling markets.
Powered by a high-capacity 400 kWh lithium iron phosphate battery capable of delivering up to 8 hours of continuous operation, the XE215EV electric excavator promises uninterrupted operation at a lower cost of ownership and with even less downtime than its diesel counterparts.
XCMG is delivering on part of that reduced downtime promise with the lower maintenance and easier repair needs of electric equipment, and delivering on the rest of it with lickety-quick DC fast charging that can recharge the machine’s massive battery in 1.5-2 hours … but that’s not the slick bit. The XCMG XE125EV can be powered up without leaving the job site thanks to its BYD battery swap technology.
We first covered XCMG and its battery swap technology back in January, and covered similar battery-swap tech being developed by MOOG Construction offshoot ZQUIP, as well – but while XCMG’s battery tech has been in production for several years, it’s still not widely known about in the West (even within the industry).
XCMG showed off its latest electric equipment at the December 2024 bauma China, including an updated version of its of its 85-ton autonomous electric mining truck that features a fully cab-less design – meaning there isn’t even a place for an operator to sit, let alone operate. And that’s too bad, because what operator wouldn’t want to experience an electric truck putting down 1070 hp more than 16,000 lb-ft of torque!?
Easy in, easy out
The best part? All of the company’s heavy equipment assets – from excavators to terminal tractors to dump trucks and wheel loaders – all use the same 400 kWh BYD battery packs, Milwaukee tool style. That means an equipment fleet can utilize x number of vehicles with a fraction of the total battery capacity and material needs of other asset brands. That’s not just a smart use of limited materials, it’s a smarter use of energy.
You can check out all the XE215EV’s specs at this tear sheet, and get an in-person look at the Chinese company’s latest electric excavator this week in Munich, Germany.
SOURCE | IMAGES: XCMG.
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