O

riginally known as the Monsanto Electronic Materials Company, SunEdison Solar was established in 1959 as a manufacturer of silicon wafers. However, the company underwent a significant transformation in 2013, rebranding itself as SunEdison to underscore its unwavering commitment to solar energy. Despite initial prospects of becoming a pioneering solar power supermajor, SunEdison faced bankruptcy in April 2016. The story of SunEdison stock is a classic example of the boom-and-bust cycle on Wall Street, as its shares experienced an extraordinary surge of over 2,000% in value before eventually plummeting and losing nearly all their worth. However, after approval of its bankruptcy-exit plan by the U.S. Bankruptcy Court in July 2017, SunEdison successfully emerged from bankruptcy on December 29, 2017.

Impact on the Solar Energy Sector

SunEdison Solar achieved extensive vertical integration to ensure high quality and cost reduction. Unlike most solar companies, SunEdison took charge of the entire process, from silicon processing to plant development. The company manufactured advanced solar technology while also handling the development, financing, installation, and operation of distributed solar power systems, offering cost-effective solutions to residential, commercial, and utility customers.

The bankruptcy of SunEdison Solar in 2016 had a major impact on the solar industry. It occurred during a period when fossil fuel producers were also facing challenges. SunEdison downfall resulted from the bursting of the Energy Debt Bubble, where excessive borrowing and easy money had a stimulant effect on solar power developers, similar to what happened with oil frackers and coal miners. Overly optimistic projections led to extensive construction, but the generated cash flows were inadequate to meet debt obligations. Despite its bankruptcy, the influence of SunEdison Solar on the renewable energy sector is still noteworthy.

Unfolding Updates: Expanding the Company's Solar Legacy

Even though SunEdison Solar is no longer in business, it left a lasting legacy in the solar power realm. Through its technology and projects, SunEdison continues to play a crucial role in providing clean energy to communities worldwide. Additionally, Mitsui & Co., Ltd. acquired the former commercial and industrial division of SunEdison back in 2017, which is now known as ForeFront Power. This acquisition allowed Mitsui to establish a strong position in the global renewable energy industry. ForeFront Power has already completed the construction of 1,000 solar projects, with a total solar generation capacity of 800 megawatts spread across 23 states. As a result, there has been a significant reduction in CO2 emissions. Mitsui is now utilizing its extensive business network to drive even further growth in this sector.

Despite its downfall, the lessons learned from Sun Edison collapse can guide future ventures and strategies, fostering a more resilient and sustainable renewable energy industry.

Sources:

https://www.mitsui.com/jp/en/innovation/business/forefront/index.html#:~:text=New%20opportunities,to%20supercharge%20growth%20even%20further

Posted 
Jul 3, 2023
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