Integration of Solar Depot and DC Power to Create Largest Solar Distributor in U.S.

Feb. 11, 2011
As the solar market matures, some industry observers believe it may one day look similar to the electrical wholesaling industry

As the solar market matures, some industry observers believe it may one day look similar to the electrical wholesaling industry, where a network of national, regional and smaller independent companies provide electrical contractors and other installers with photovoltaic panels, inverters, racking systems and balance of system (BOS) products such as wire and cable, circuit protection equipment, enclosures, conduit, connectors and related devices to tie-in the solar panels to a facility’s electrical system and the power grid.

In a move that points toward the evolution of the distribution channel in the solar market, the parent company that owns two of the largest solar distributors in the market, DC Power Systems, Rohnert Park, Calif., and Solar Depot, Petaluma, Calif., announced last week that it would integrate some of the back-office internal operations of these companies so they could focus more on marketing solar products in North America. The two distributors will operate as two companies within SolarNet Holdings, LLC, and will together serve more than five thousand renewable energy dealers throughout the Americas, forming the largest distribution company in the industry.

In a press release announcing the integration, Kevin Shimokobe, newly named CEO of SolarNet Holdings, and previously CEO of both Solar Depot and DC Power, said, “By combining the resources of our two companies, we are creating a best-in-class solar energy distribution company that is poised for significant and sustainable growth. Customers can expect to continue to interact with each company as they always have. DC Power and Solar Depot will maintain separate brands while offering customers better service, thanks to several process improvements including significant joint investment in IT infrastructure.”

Through the integration, DC Power and Solar Depot will share regional distribution warehouses; open new warehouse locations; combine dealer training programs; pursue deeper relationships with leading solar manufacturing partners; and build on their technical and sales support. In addition, SolarNet Holdings said cost and operational advantages gained through the integration will increase the competitive advantage of both companies. “With industry-leading products in photovoltaics, solar thermal and wind energy, DC Power and Solar Depot will combine to form the most complete renewable energy distributor in the Americas,” said Shimokobe in that press release.

DC Power Systems was founded in 1999 by Joseph and Daniel Marino, and according to the press statement quickly became one of the nation’s largest distributors of renewable energy products, with more than 5,000 dealers throughout North and South America, and regional offices in eight U.S. states.

For more than 30 years, Solar Depot has been designing and supplying solar energy systems for residential, commercial and industrial applications, making it one of the largest and most experienced solar distributors in the United States. Having pioneered one of the first solar training programs for contractors in 1999, the company has since trained over 5,000 contractors, many of whom now constitute Solar Depot’s dealer network throughout the U.S. In addition to its Petaluma headquarters, Solar Depot also operates two other full-service facilities in Sacramento and Corona, Calif., and has sales offices in Washington, D.C., Florida and Colorado.

The company, which was the subject of a 2007 Electrical Wholesaling cover story, was acquired in 2007 by ITOCHU Corp., a subsidiary of ITOCHU International Inc., a large Japanese trading company that at the time of the acquisition had total revenues of $22 billion. ITOCHU is an established global player in the solar market, and the ITOCHU Machinery Group has been supplying manufacturing equipment to solar module manufacturers globally for several years. According to ITOCHU’s corporate website, it also now has approximately $2 billion in assets in the United States through its ownership of a diverse array of companies. These companies include distributors not only in the solar market but also in telecommunications, power, fruit and vegetable, chemical, security, fencing and medical markets.