Energy Transition & Power Demand
BNP Paribas urges caution on solar stocks despite grid-ambition boost
BNP Paribas analyst Moses Sutton warned investors not to get carried away by enthusiasm over virtual power plants, even as solar stocks rallied on a recent announcement involving Sunrun, Tesla, and Renew. The announcement suggested up to 17 gigawatts of battery and heating-and-cooling capacity could eventually be pooled to support the grid, but BNP Paribas noted that only about 6.7 gigawatts of residential battery capacity has been installed across the United States to date, much of it concentrated in California. After accounting for geography, existing contracts, and competitors, the firm estimates only a fraction of the announced capacity may be available for new grid-support programs in the near term, with a favorable scenario of 2 gigawatts generating roughly $90 million in annual revenue before sharing proceeds. The report also highlighted that data centers may increasingly rely on on-site backup generation, while U.S. utility-scale solar development remains strong with a pipeline of 161 gigawatts and deployments on track to exceed 40 gigawatts in 2026.