Navigating the “solar Coaster”

The journey of California Solar Electric Company (“Cal Solar”) over the past two decades has unfolded against the backdrop of a “solar coaster”... the dramatic ups and downs of the solar energy industry. When Cal Solar was founded in 2000 in Nevada County, CA, solar power was still a niche field. Early on, the company embraced a triple bottom line philosophy, valuing social and environmental goals alongside profit. In the years since, both Cal Solar and the broader industry have experienced cycles of booming growth, policy-driven surges, technological progress, and challenging downturns. Below is an overview of key phases in this ride, highlighting how industry trends and company milestones intertwined.

Around the year 2000, solar photovoltaics were just beginning to move from a small “niche market” of off-grid and experimental projects into the mainstream of power generation. Global installations were very limited, for instance, the entire world added less than 1 gigawatt of solar in 2004. Yet governments were starting to recognize solar’s potential to address climate change and energy security. In these early years, Cal Solar focused on off-grid solar installations, including early solar panel and battery storage systems, as Black Oak Electric, the original incarnation of the company. With minimal formal training available in solar at the time, the company built expertise from the ground up.

A major turning point came in the mid-2000s. In 2006, California launched the California Solar Initiative (CSI), a landmark program committing $2.8 billion in subsidies to spur residential and commercial solar statewide. This, along with the new 30% federal Investment Tax Credit (ITC) introduced in 2006, dramatically expanded the U.S. solar market. Huge public investments signaled that solar was becoming a serious industry. Globally, supportive policies like CSI and European feed-in tariffs drove rapid growth. From 2004 onward, solar manufacturing, especially in China, scaled up at an astonishing rate, with Chinese cell production growing 100–400% per year and creating supply bottlenecks by 2007–2008. Panel prices began to decline due to economies of scale and technical learning, making solar more accessible.

During this boom, Cal Solar itself transitioned from a small local player into a more established business. By 2004, it had formally become the California Solar Electric Company, opened a real office, and started signing substantial contracts. The team grew (co-founder Lars Ortegren joined as an installer in the early 2000s), and the company took on larger projects, including some of the region’s first microgrid installations by 2006. Fueled by solar incentives in California and increasing public interest, Cal Solar’s trajectory was pointed up.

The solar upswing met a sudden challenge with the 2008 global financial crisis. The recession dried up investment and credit for solar projects, causing an industry slowdown. Demand for solar panels temporarily stalled, and a glut of manufacturing capacity led to plummeting prices. In 2008–2009, many solar companies struggled or went bankrupt under the dual pressures of economic contraction and “oversupply”. Cal Solar was no exception, the housing market crash hit the business hard in 2008, nearly collapsing the company under financial strain. What had been one of the area’s leading solar providers was reduced to a skeleton crew (at one point essentially just Lars keeping the operation alive).

Fortunately, 2009 brought relief. As part of the post-crisis stimulus, the U.S. government injected roughly $90 billion into clean energy initiatives. New grants and funding streams (like cash grants in lieu of tax credits) helped finance solar projects when private investment lagged. These measures “proved vital” to sustaining renewable development during the recession. Cal Solar was able to rebuild “from the ashes” beginning in 2009, as key team members returned and modest growth resumed. Globally, solar demand picked up again thanks to stimulus spending and the return of project financing, by 2010 the industry was back to rapid expansion mode.

Another dynamic of the late 2000s was the rise of trade conflicts in solar. Chinese manufacturers, bolstered by government support, had grown to dominate global solar panel supply by the early 2010s. In response, U.S. solar panel makers filed complaints of unfair competition. This led to the first anti-dumping tariffs on imported Chinese solar cells, with duties of about 30% imposed by 2012. These tariffs aimed to protect U.S. manufacturers from ultra-cheap imports, but they also raised solar panel costs for installers. (Industry critics warned such tariffs would “increase the cost of solar and depress demand”, ultimately costing American jobs.) Cal Solar, primarily an installer, had to navigate these shifting trade policies which affected equipment pricing and availability.

The 2010s saw solar power truly enter the mainstream. Annual global installations surged to new records, for example, the world added about 117 GW of solar in 2019 alone, nearly a ten-fold increase from a decade prior. Key drivers were steadily falling costs (solar module prices fell ~85% from 2010 to 2019) and supportive policies worldwide. In the U.S., Congress extended the 30% solar ITC multiple times, notably in 2015, providing a stable 5-year outlook that helped the industry avoid a feared drop-off. 

Around this same period, Cal-Solar’s founder Daniel Flanigan had moved on from the company to co-found Zep Solar in 2009, a racking innovation firm that transformed installation practices across the industry. Zep was later acquired by SolarCity in 2013, and its technology became a cornerstone of Tesla’s solar operations after the SolarCity–Tesla merger. In this way, Cal-Solar’s early history is directly linked to some of the most influential developments in modern solar, showing how our roots connect to the larger story of the industry’s growth and innovation.

By 2016, solar had a firm foothold as one of the fastest-growing sources of new electricity. A symbolic moment came when Tesla, known for electric cars, acquired SolarCity (then the largest residential solar installer in the U.S.) in 2016, a $2.6 billion deal to integrate solar energy with Tesla’s clean energy ecosystem. This merger underscored how solar had become a strategic piece of the broader clean tech and energy storage sector.

For Cal Solar, the 2010s were a period of significant evolution. The company explored the possibility of employee ownership as early as the mid-2010s. After years of planning, in 2019 Cal Solar formally transitioned into a worker-owned cooperative, becoming the first such solar co-op in California and in Nevada County. This move, accomplished with help from Project Equity, gave employees an equal stake in governance and profits, reflecting Cal Solar’s long-held values of “real equality” and community focus. The cooperative structure empowered staff in decision-making and aimed to make the business more resilient. In the same timeframe, Cal Solar deepened its commitment to ethical and sustainable business by becoming a Certified B Corp in 2020, meeting high standards of social and environmental performance. These developments set Cal Solar apart as an innovator in business model and culture, even as it continued delivering solar installations and adapting to market trends.

The late 2010s did bring some volatility. There was a period of market turbulence around 2012–2013 due to rapidly falling solar panel prices and some high-profile manufacturer bankruptcies (for instance, Suntech, once the world’s largest panel maker, went bankrupt in 2013 amid Chinese industry consolidation). Cal Solar navigated these challenges by staying agile, ending a partnership with PlanIt Solar Electric company in 2013 to refocus on its own sales and moving its headquarters to a new location that year. By 2015, the company hit new highs, earning recognition as a top regional installer (including an award as “Best Solar Company” locally). The extension of the federal ITC that year provided a runway for growth, and Cal Solar’s team voted overwhelmingly in favor of pursuing the co-op conversion (though it took a few more years to execute for financial reasons). Overall, the 2010s closed with optimism: solar was cheaper than ever, public support for clean energy was strong, and Cal Solar had reinvented itself as a democratic workplace owned by its employees.

The 2020’s so far have tested the solar industry, and Cal Solar, in new ways. The decade opened with the COVID-19 pandemic, which disrupted global supply chains and construction. In 2020, many solar manufacturers in China were forced to halt production due to lockdowns, since roughly 70% of the world’s solar panels are made in China. Shortages of solar panels and raw materials led to project delays worldwide. Cal Solar experienced this firsthand when supply bottlenecks and workforce limitations slowed installations during the pandemic’s peak. Yet demand for solar remained robust. In fact, in the midst of COVID, California’s SGIP incentive (a subsidy for home battery storage systems) triggered a surge of interest in solar+ battery storage, Tesla Powerwall batteries became “super popular” with rebates up to $5,800 per unit, resulting in months-long backorders in 2020. Cal Solar received an influx of 100+ home backup battery contracts in a 2-3 week span, stretching its small crew to the limit. Despite some “fiascos” (such as implementation snags with Tesla’s program), the company pushed through, completing projects with a lean team and maintaining customer trust through an incredibly turbulent period.

By 2021, the industry was rebounding but faced a new hurdle: global supply shortages in critical materials. A polysilicon shortage that year, caused by factory outages and surging demand, drove the price of this key solar ingredient up 175%, reversing years of falling solar  panel prices. For the first time in recent memory, solar module costs to consumers ticked upward (~4% in early 2021). Cal Solar had to explain to customers why prices were a bit higher and timelines longer for projects. The company also adjusted its strategy, leaning more into battery storage and service offerings to weather the dip in pure solar sales. Internally, Cal Solar’s cooperative culture helped: as a small group of worker-owners, they strategized collectively on cost controls and creative sales approaches. The team that had rebuilt after 2020 now focused on adapting product mixes (e.g. offering more backup power systems) and preparing for policy changes on the horizon.

In 2022, a major tailwind arrived: the U.S. passed the Inflation Reduction Act (IRA), which included historic support for clean energy. The IRA restored the federal solar ITC to 30% for at least ten years (through 2032), providing a long-term incentive stability that the industry had never before enjoyed. It also introduced new credits for domestic manufacturing and standalone energy storage. This policy certainty kicked off another investment boom… over a terawatt (1,000 GW) of new solar and battery Storage projects flooded into U.S. interconnection queues after the IRA’s passage. Cal Solar viewed the IRA as a game-changer for its future pipeline, with more homeowners and businesses motivated to go solar. At the same time, California’s regulators decided to significantly revise net metering for solar (NEM 3.0, effective April 2023), slashing the credits for excess solar power sent to the grid. This looming change created a “solar rush” in late 2022 and early 2023, as customers hurried to install systems under the more favorable old rules. Cal Solar saw a spike in demand leading up to the deadline, followed by a slowdown afterward as the new net metering policy made solar economics less attractive without energy storage.

The year 2023 brought a mix of record achievements and continued growing pains. On one hand, energy storage deployment exploded, the U.S. installed roughly 8 GW of battery storage in 2023, doubling cumulative capacity to ~16 GW. Solar-plus-storage projects became standard for many customers, and Cal Solar capitalized on this trend by bundling batteries with most new solar systems to maximize value under NEM 3.0. On the other hand, grid interconnection delays emerged as a serious bottleneck. Across the country, over 2.6 TW (2600 GW) of new generation was stuck in utility interconnection queues by the end of 2023, with projects waiting 5+ years on average to get grid connection approvals. Cal Solar felt these pains particularly on larger commercial projects, which languished in permitting and interconnection studies. The cooperative’s leadership became active in advocacy for grid reform, echoing the broader industry’s concerns that bureaucracy and lack of grid upgrades were “not the pace that we need” for clean energy expansion.

Meanwhile, macroeconomic conditions in 2023–2024 created headwinds for solar sales, especially in the residential segment. Rapidly rising interest rates made solar financing more expensive for homeowners, damping demand. In 2024 the U.S. residential solar market saw a 31% year-over-year decline in installations, its first contraction since 2017. Higher borrowing costs, combined with the reduced net metering benefits in big states like California, caused many would-be customers to pause. Cal Solar experienced this slowdown directly, with residential sales softening in 2024. Yet it was not all gloom: even in a down year, the fundamentals driving solar remained in place. Americans’ utility rates kept climbing, and outages from extreme weather underscored the appeal of home solar with backup batteries for resilience. Industry analysts noted that despite short-term setbacks, “the fundamentals for residential solar remain strong”... from high power bills to interest in energy independence. Cal Solar leaned into those fundamentals, educating customers on the long-term savings and security solar can provide. The co-op also tightened its belt through the slow period, controlling costs and focusing on retaining its skilled workforce. Even as the broader solar industry faced bankruptcies and slowdowns in 2024, Cal-Solar held steady through the cooperative model. By working together and making thoughtful adjustments, we kept our focus on supporting one another and our community while navigating the storm around us.

Now in 2025, the solar industry stands at another inflection point. Economic uncertainty has made businesses cautious, but consumer demand for clean energy is as strong as ever, driven largely by PG&E’s soaring rates and ongoing reliability challenges. Trade policy remains a wild card: import tariffs on all materials (not just solar panels) continue to influence equipment costs and supply. Manufacturers are ramping up new U.S. factories thanks to prior IRA incentives, which could help mitigate the tariff impact and global supply dependencies. For Cal-Solar, these macro factors require careful navigation, balancing inventory, pricing, and project timelines with an eye on policy changes. The cooperative’s strategy for 2025 and beyond is focused on sustainable growth and resilience. That means pursuing steady installation volume (rather than rapid, risky expansion), investing in resources to support our current staff, maintaining strong community relationships, and diversifying services (such as more system maintenance and monitoring packages, EV charger installation, and load management) to buffer against market swings. We are also experimenting with using the Power Purchase Agreement (PPA) model, which still allows projects to benefit from the federal tax credit that was abruptly eliminated for direct ownership this year. The company’s 25-year history on the solar coaster has taught it to expect the unexpected, but also to appreciate the remarkable long-term trajectory. Solar PV has grown from virtually nothing to over 1 terawatt of capacity globally in two decades, and Cal-Solar has grown from a tiny off-grid installer into a pioneering worker-owned enterprise. Every twist in the ride, technological breakthroughs, policy booms, recessions, pandemics… has ultimately advanced the mission of cleaner energy. As Cal-Solar moves forward, it does so with confidence that the cooperative values of equity, local empowerment, and adaptability will continue to be its guiding light through the next chapters of the solar coaster.

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