1. Strategic Expansion of SolarCity into Brazil
BUS-D 271: Global Business Analysis
Presented to: Professor Paul Coulis
Presented by: Cole Sears

2. 1
Executive Summary
SolarCity quickly grew from a startup to the market leader in customized solar energy systems.
The company installs one in every three residential solar systems in the United States and has
created partnerships with corporations, governments, and schools to provide solar energy
systems to fit their dynamic needs. The solar energy growth is not contained to the United States,
but is spreading across the globe to meet growing energy demands and prevent further
destruction to the environment from traditional energy sources. Following an analysis of possible
international expansion opportunities for SolarCity in Chile, Brazil, and Morocco, Brazil
presented the highest growth potential for SolarCity to expand its operations.
Brazil offers an emerging economy that boasts a flourishing middle-class that is moving to the
city and demanding more energy to fuel their new lifestyles. This emerging market is led by a
government that has experience with renewable energy. Brazil is a leader in renewable energy,
with a majority of their power coming from hydroelectric dams. While Brazil’s intentions are
admirable, their execution is skewed by their dependence on hydroelectric sources. Hydroelectric
power is reliable as long as rain is falling. When a drought occurs, production suffers. A drought
occurred in 2001-2002 in Brazil, forcing the government to ration energy supplies and kick start
a campaign to increase solar usage. Brazil’s electricity rates are steep and strain the budgets of
homeowners and businesses. This market’s potential growth will drive electricity demand and
rates to increase further, creating a need in the market for cheaper electricity that solar can fulfill.
SolarCity’s product line of customized residential and commercial energy systems provide the
means to fill the void and allow SolarCity to begin expanding operations beyond the United
States into markets that will provide new revenue streams. Favorable tax incentives, reduced
financing rates, and public support from Brazil’s government provide the advantage for an
optimal market over countries like Chile and Morocco. These countries are interested in solar,
but do not match the actions taken by Brazil to welcome foreign investments in solar technology.
Expanding into Brazil does pose risks for SolarCity including government corruption, regulatory
inefficiency, and moderate competition. Brazil’s government leaders are plagued by corruption,
giving it a 43 out of 100 on International Transparency’s Corruption Index. The public has begun
to protest this corruption and international businesses entering Brazil will promote change in the
governmental landscape. Regulatory inefficiency delays permit applications for companies to
begin their operations. Local governments are substantially more efficient and are active in
promoting solar technology by making it easier to maneuver the regulatory system where the
federal government makes it difficult. SolarCity will easily differentiate from the competition in
Brazil because many of the firms there are focused on providing large-scale solar production to
replace traditional energy plants, rather than specialized individual systems like SolarCity.
SolarCity can provide the source for Brazil’s growing energy demand by creating customized
solar systems that meets the customer’s needs, reduces their electricity cost, and allows them to
use sustainable energy. SolarCity is at the forefront of technology that will create lasting impacts
beyond the United States. Brazil holds the greatest potential for SolarCity to begin their
international impact and growth.

3. 2
Strategic Expansion of SolarCity into Brazil
The world’s dependence on traditional energy sources has caused shrinking supplies, increasing
prices, destruction to the environment, but most importantly the drive to find new sources to
power our growing societies. Solar power quickly became a contender in the clean energy
market, accounting for one-third of new clean energy capacity in 2012 and increasing in capacity
by 55% year-over-year for the last five years (“Renewables 2014”). Solar has proven it can fuel
our world while being substantially more flexible than traditional energy sources. Solar is
flexible because it only requires solar panels (that mount almost anywhere) and sunlight. This
creates independence from the grid while still having a source of reliable power. The solar
photovoltaics (PV) market has started to branch out from solely residential and play a larger role
in industrial and communal power systems. This presents an opportunity for growth that reaches
every corner of the world, no matter how large the demand.
SolarCity created a business model that
thrived by allowing consumers to install
solar power on their home, business, or
factory with little to no investment.
SolarCity became so successful that their
market share is larger than their next 14
competitors combined (Michaels).
SolarCity installs 1 in every 3 US solar
power systems, an example of their
tremendous ability penetrate markets and
prevail over competition (“Solar Panels
for Home”). In June 2014, a strategic
move was made to purchase Silevo, a US
solar panel manufacturer. This purchase is
another example of SolarCity’s forward-thinking
ability to stay ahead of the competition and bring
the best solar energy systems to the market. Silevo
is a leader in cutting-edge PV technology and has
found success by designing super-efficient solar
panels at minimal cost (Musk). SolarCity is also
profiting from an increase in global coal prices
and a reduction in the cost of solar power, as
displayed below in Figures 1 and 2, respectively.
These two factors create a promising outlook for
SolarCity and put the company in an ideal spot to
began entering into international markets.
Figure 2: Price of Solar Steadily Decreases
Source: Pope
Figure 1: Coal Prices Continue to Increase
Source: “World Economic Outlook Database”

4. 3
SolarCitySWOT Analysis
Strengths
The potential from the increasing demand for solar energy created numerous sources of cheap
capital for SolarCity. This capital helps the company to continue expanding without incurring
astronomical borrowing rates, allowing SolarCity to continue to penetrate the market further.
Installation costs have been a main focus for investors of SolarCity because they are their largest
operating cost (Denning). SolarCity’s installation costs have decreased steadily due to new
technology. SolarCity purchased Silevo, a United States solar panel manufacturer, in 2014 to
bring panel production in-house. The Silevo purchase will assist in shifting production of
SolarCity’s panels from China to the United States, reducing costs by avoiding a 35% tariff
placed on solar panels imported from China (Basenese). This purchase also created a new
revenue stream for SolarCity since solar panel installations are projected to continue increasing
at a steady rate as displayed in Figure 3. Much of SolarCity’s success is due to their corporate
connections created to fund their residential
Power Purchase Agreements (PPA). PPAs
help customers afford solar without paying
ownership costs, but still allowing users to
buy their system later on if they desire
(“Solar PPA Financing”). This provides an
advantage over competitors since customers
can use solar to replace their traditional
energy without having to invest thousands
in purchasing a whole system, like many of
SolarCity’s competitors require.
Strengths
 Access to cheap capital
 Reducing installation costs
 Minimal investment for customers
 Beginning to produce solar panels in-
house
Weaknesses
 Dependent on Chinese currency
 High debt-to-equity ratio
 Weak cash flow
 Domestic-only sales
Opportunities
 Increasing demand for renewable energy
 Increasing costs for traditional energy
 International governments are backing
renewable energy providers
Threats
 New solar ventures are creating
increased competition
 Possible solar tax credit expiration
 Other solar ventures are quickly
penetrating international markets
Figure 3: Solar Panel Demand Increases
Source: Shahan

5. 4
Weaknesses
SolarCity receives a major portion of their panels from Chinese manufacturers. Because of this
they are dependent on the Chinese yuan and how the US dollar appreciates, or depreciates,
against the yuan. Eliminating this risk is another advantage of SolarCity shifting its production to
the United States. Due to the rapid expansion, SolarCity has incurred a high debt-to-equity ratio,
making the company negatively leveraged and a higher risk to investors. This is soon to change
due to a lease program recently created to be another option to PPAs that would reduce costs for
SolarCity, and the benefit for customers being that they took ownership of their systems earlier.
A weak cash flow for SolarCity caused their dependence on capital investments. Going
international would require this to be resolved or more investments would be necessary. The
company currently is domestic only, creating an international expansion learning curve that
outside assistance and consulting could help become successful. Consulting combined with
SolarCity’s leaders and advisors, including Elon Musk, would provide a successful team to
transform SolarCity into an international corporation.
Opportunities
Rising costs for traditional energy
sources, predominately coal, have
increased electricity rates
dramatically and caused consumers
to search for cheaper alternatives.
Solar emerged as a top candidate
because of its reliability on a
dependent source, flexibility for its
panels to be placed virtually
anywhere, and its low installation
costs relative to other renewables.
Growing demand from consumers and a desire for clean energy created a renewable energy
market that has grown dramatically in the past ten years, displayed in Figure 4. Market research
firm IHS, predicts Latin American PV capacity will grow four times its current rate in the next
year and continue growing in the future (Shahan).
Governments are actively investing and creating prime conditions for solar providers to increase
capacity. In the United States, a 30% tax break provides assistance in initial investment for
consumers. Brazil’s government created policies to enact tax exemptions for solar providers, but
local Brazilian governments have gone further by creating deeper tax breaks and spearheading
projects to bring international providers into Brazil to grow the country’s solar presence. Many
projects are under development and 30 projects, for a total of 1.041 MW capacity, are being bid
on in December 2014 (Lopez).
Figure 4: Solar PV Total Global Capacity Rises
Source: “Renewables 2014”

6. 5
Threats
Increased demand for solar power created an increase in competition for SolarCity in the United
States. Industry insiders fear the US government will take away the 30% Investment Tax Credit
due to the success and growth industry. While this is only a possibility, it poses a risk to
SolarCity’s residential market, because this offsets the price to customers dramatically. These
two threats provide incentives for SolarCity to expand abroad and reduce the risk by finding
markets with less competition and tax breaks that have no chance of being revoked. As discussed
earlier, international market are being penetrated due to their potential. By delaying international
expansion, SolarCity is threatening their market share potential and ease to enter a new market.
This provides another incentive for SolarCity to act quickly and expand their operations
internationally, specifically in Brazil where the market potential is abundant.
Brazil’s PEST Factors
Political
Brazil recently created aggressive renewable energy targets
and policies to provide for their citizens (“Renewables
2014”). The Brazilian government is looking to bring
investments within their borders, in 2010 when the foreign
investment tax rate was tripled, companies complained and
the government immediately reversed it back to the original
amount (“The Buys from Brazil”). This stance paired with
the government’s promise to offer public credits to investors
proves their desire for clean energy investments in Brazil
(Teixeira). These are fueling the investment market in Brazil,
making it the third highest place for private-equity
investments for emerging markets, as shown in Figure 5.
Some corruption does exist within the government,
increasing the regulatory inefficiency that exists. Brazil is actively growing their relationship
with the United States government and currently is one the United States’ top ten trade partners
(“Foreign Trade”). This growing relationship provides governmental, logistical, and regulatory
support for US companies looking to enter Brazil.
Economic
The Brazilian Development Bank (BNDES) ranks as the industry’s top investor in private-equity
investments (“The Buys from Brazil”). More importantly, the BNDES recently created low-
financing rules for international companies looking to invest in the Brazilian solar market
(Dezem). While some may think rising inflation in Brazil may have negative impacts on the
demand for solar investments by consumers, increasing electricity rates give a financial incentive
for consumers to switch to solar energy systems. Brazil’s middle-class grew 40% in the past
decade, or about 30 million new middle-class members ("In Brazil”). These two facts combine to
provide an ideal, growing market for SolarCity to target when entering Brazil. The US dollar is
relatively strong to the Brazilian real, preventing expansion costs from being inflated due to
currency exchange.
Source: “The Buys from Brazil”
Figure 5: Brazil Ranks Third in
Emerging Market Investments

7. 6
Social
Pablo Barros, journalist for The Guardian, stated that the middle-class growth is “stretching
Brazil’s natural resources beyond their capacity” (Barros). Brazil’s government began to
promote renewable energy sources as a remedy for this problem, creating a huge market
potential for renewable energy providers. The campaign is garnering a positive response from the
public, particularly due to Brazil’s collective-centered society (Barros). This societal trait creates
a selling point for solar companies, because solar is good for everyone, not just the consumer of
the power. An advantage to the rapid middle-class growth is the increase in an urban population,
which creates a focused area for SolarCity to target. This urbanization allows SolarCity to focus
their resources in geographically tight areas, reducing costs from having a spread out market.
The language barrier that exists causes a complication for a US company in Brazil, but provides
an incentive to employ locals and further improve the public’s view of the company while
continuing to improve the local economy.
Technological
The 2014 World Cup and 2016
Olympics spurred infrastructure
overhaul in Brazil, especially in
the communications
infrastructure. These upgrades
included 77% year-over-year
increase in bandwidth during the
past few years, reducing
bandwidth costs and giving
Brazil the seventh highest
bandwidth capacity in the world
(Woodcock). Brazil’s technology
industry is lacking, though,
meaning SolarCity should expect minimal research and development to come from Brazil. Brazil
boasts ample access to waterways and ports, with Rio de Janeiro and Sao Paulo, the country’s
two largest cities, lying on the Pacific Ocean. These cities boast many river routes that lead
throughout the country and plenty of airports to access Brazil from abroad and when traveling
within the borders. The most important factor to SolarCity’s success in Brazil is sunshine. Brazil
claims some of the highest sunshine rates in the world, displayed in Figure 6, providing the
necessary environment for solar power to be effective.
Brazil: SolarCity’s Optimal International Market
Brazil stands out as the ideal place for SolarCity’s initial international expansion because of its
large energy demand, increased demand for alternative energy and emerging economy. Brazil is
South America’s largest energy consumer and ranks 8th largest in the world in the same metric
("Brazil Analysis”). This market continues to grow at a staggering pace with electricity
consumption expected to grow by 52% through 2019, creating a rapidly growing market for
SolarCity to expand their operations into (Markey). Because of this energy growth, Brazil
Source: "Which countries receive the most sunlight?”
Figure 6: Brazil’s Boasts High Sunshine Rates

8. 7
continues to promote alternative sources. The country has set forth policies to increase
alternative energy use and publically promotes and assists companies entering Brazil to provide
alternative sources. SolarCity could capitalize on the tax breaks, low-financing rules, and
alternative energy demand that would come with entering Brazil.
Brazil’s high electricity rates of 18-34 cents, more than triple the United States average rate,
creates a strain on Brazilian consumer’s budgets that solar would relieve (Orihuela). Robert
Sears, Vice-President of Customer Energy Solutions for Vectren Corporation (a Fortune 1000
company that provides electricity and natural gas to over 1 million customers) stated that once
electricity rates exceed a 15 cent threshold, rooftop solar is a cost saving alternative to traditional
energy sources (Sears). Using this rationale, solar would provide Brazilian consumers with a way
to definitively save on their electricity bills, increasing the demand for SolarCity’s PV systems.
The middle-class, SolarCity’s target market, growth of 40% in the past decade creates a target
market that continues to grow substantially quicker than the US market and provides SolarCity a
way to tap into the growing energy demand that comes with Brazil’s middle-class growth ("In
Brazil”). This would also allow SolarCity to expand beyond the saturated PV market in the
United States and began growing in a less-competitive Brazil market.
Brazil Offers Multiple Markets for SolarCity
Three markets exist within Brazil for SolarCity: residential, industrial, and community-owned.
SolarCity will benefit greatest from focusing on the residential market upon initial entry due to
their expertise and success in this area within the United States. Following sustainable success in
the residential market, the industrial and government markets provide new growth and
diversification for SolarCity.
Residential
The residential market will target Brazil’s
expanding middle-class and will be the main focus
for SolarCity’s entry into Brazil. SolarCity has
proven their success in the US residential market
by providing relief from high electricity rates with
many different purchase and financing options that
will have the same effect in Brazil.
An article from Reuters suggests that SolarCity’s
MyPower loan will be more appealing to
customers because there is no money due upfront and customers can take advantage of any tax
credits that exist while owning their system (Groom). This new loan option will also be
appealing in Brazil where tax credits exist for solar energy systems. The zero dollar upfront cost
will be an appealing marketing strategy for SolarCity to lead with when entering Brazil to gain
customer attention and consultations. By SolarCity offering their 30-year warranty with the
MyPower loan they will also gain brand confidence in their product and service, further
strengthening their brand appeal by Brazilian consumers.
Source: SolarCity.com

9. 8
Leasing the solar energy systems is currently the most-popular financing option. This also has
potential in Brazil because of its zero upfront cost, locked in low rates to protect from volatile
markets, and only needing to pay for the power consumer uses. These will also be favorable in
the emerging Brazilian market where the middle-class is growing, but may not be prepared to
commit to a loan to own their solar power system. Brazilian consumers will benefit from reduced
costs over traditional energy while also being able to sell excess energy produced back to the
grid, a definite possibility in the sunny country (Bullis). These will combine to create a price
point that appeals to this middle-class who is learning to manage their new disposable incomes.
PPAs may prove a more difficult means to finance Brazilian customer’s solar systems because it
will take time to find willing corporate partners to fund the ventures. Finding corporate partners
is also a reason to hire Brazilian natives who network with the top corporation in Brazil. Once
the connections are made, corporations will flock to the program just like Google and others
have in the United States, because of their ability to profit from their investments by selling
excess solar back to the grid (Wesoff).
Corporations to consider are Brazilian
giants like Telefonica, Telemar, and
other leaders in the industry who
would like to invest in solar and grow
their green portfolio. Targeting US
companies that have large operations
in Brazil such as General Motors,
Ford, and Cargill would allow
SolarCity to leverage their common
nationality and headquarter locations
to create connections in Brazil for PPA
funding.
New home building projects will accommodate the middle-class growth and the investments
from the World Cup and Olympics going to improving living conditions in Brazil. The home
development growth provides a market that SolarCity could capitalize on by partnering with
homebuilders to install SolarCity solar energy systems directly onto the home. These would
provide benefits for the homebuilder and homebuyer by creating homes that have inexpensive
electricity rates and are “greener”. This market could be a lucrative target for SolarCity and
prevent failed attempts to convert interested consumers because of their fear surrounding
switching costs, risks, and consumer apathy in following through with the process.
These four markets provide different strategies that all provide effective plans to capitalize on the
Brazilian residential market that is growing, interested in reducing living costs, and looking to
live sustainably.
Source: SolarCity.com

10. 9
Industrial
Companies across the United States are looking
for ways to minimize costs and reduce their
carbon footprint. SolarCity has helped
numerous companies do this by installing solar
energy systems on their office buildings,
factories, and other structures. Companies in
Brazil are looking to accomplish similar goals
and SolarCity can help them succeed at this, just
like they have done in the United States.
Entering a new market will provide SolarCity with a plethora of new potential clients. They
should begin in the Brazilian industrial market by leveraging the relationships that exist with
their clients who operate in both the United States and Brazil. Corporations that SolarCity
currently works with in the United States and who have sizable operations in Brazil include:
WalMart, Toyota, Honda, and HP (“Solar Energy”). By starting with these companies in Brazil,
SolarCity will attain their first industrial clients easier while creating a positive reputation and
increase their brand presence among other industry and corporate leaders in the country.
Brazil’s growth is expected to continue across many industries, and the country has signed a law
requiring a 39 percent decrease in greenhouse gases by 2020 (Messenger). These two facts create
an opportunity for SolarCity to capitalize on by providing these new operations to go green from
the beginning. The large-scale nature of many of these offices, factories, and warehouses provide
large revenue opportunities for SolarCity on a single project. These projects provide the
customer reduced electricity bills, reduction in carbon emissions, and safety from any type of
power rationing put in place by the government.
Source: SolarCity.com
Source: SolarCity.com

11. 10
Government
Government and schools offer a third market for
SolarCity to enter within Brazil. This market
provides a unique opportunity to supply solar
energy systems directly to the government
structures, such as government offices, water
treatment facilities (pictured, left) and recreational
areas. When the citizens see that their government
is not only saying that everyone should adopt
green technology, but doing it themselves, the
public will be more inclined to inquire about solar
options for themselves.
SolarCity has succeeded at assisting governments such as the City of Sacramento, City of San
Jose, and many others in converting to solar power systems. Governments in Brazil are looking
for the same options to reduce their electricity rates and promote the renewable energy push that
they are driving for their citizens (“Government Solar”). SolarCity can provide this for the
Brazilian Governments, particularly the local governments, who are consistently going far
beyond the federal government in green energy reforms (Lopez). These government contracts
would provide SolarCity not only revenue from the sales, but connections within the
governments that could prove valuable in the future when navigating the bogged-down
regulatory system that exists.
The education system in Brazil is
struggling in many benchmarks. An
Economist article entitled “Brazil’s Poor
Schools: Still a lot to learn”, suggest that
many of these struggles revolve around
financial limitations (“Brazil’s Poor
Schools”). SolarCity’s solar power
systems provide a mechanism to reduce
these school systems’ electricity rates so
they can redirect their funds to providing a better learning experience for their students.
SolarCity can carry over their success from working with large school corporations, like the Los
Angeles Unified School District and Scottsdale Unified School District, into Brazil to create the
same outcome for Brazil’s schools: reduced electricity rates, increased environmental health, and
promoting sustainable lifestyle for students.
SolarCity’s Entry into Brazil
Entry into Brazil would include bringing SolarCity’s entire product line so that the company can
capitalize on each of the three markets, as discussed above. BNDES’s rule to provide low-
financing options through 2020 to solar companies that import their PV panels would help
SolarCity enter into the market while using their same manufacturing centers in China and at
Silevo’s US factories. Beyond 2020, SolarCity could continue to import their panels if
Source: SolarCity.com
Source: SolarCity.com

12. 11
logistically and cost appealing, or look to expand Silevo into Brazil by opening a manufacturing
center and supplying SolarCity’s Brazilian venture with panels from that new factory. This
would provide new opportunities for Silevo to grow by also providing PV panels to SolarCity’s
competitors in Brazil, as well as throughout Latin America, to profit from their growth.
The right personnel is critical for the success of the expansion. SolarCity should look to hire a
part of the management and general employment team from natives of the regions they plan to
enter. This would minimize cultural and language learning curves and reduce acclimating to the
market by hiring experience instead of taking the time to attain it. These native employees would
know how to maneuver regulations and connect with customers effectively. This would also
provide SolarCity with positive brand image from the start by hiring locals and stimulating local
economies.
PotentialRisk of Brazilian Expansion for SolarCity
Risks exist in expanding to Brazil, but mitigation techniques do exist to minimize or eliminate
those risks. Corruption is clearly present in the Brazilian government by the Transparency
International Corruption Index score of 43 on a scale of 0-100, 0 being most corrupt (“2014
Corruption Perceptions Index”). The public is aware of the widespread corruption and is
beginning to voice their opposition. Bringing in international business, such as what will happen
in Brazil’s emerging economy, will provide the push for the government to create accountability
measures and transparency to rid the government of corruption.
Regulatory inefficiency also poses a risk to SolarCity’s expansion into Brazil. According to the
Heritage Foundation, red tape attributed to Brazil’s 53.8 out of 100 score on the business
freedom scale (“Brazil Economy”). To prevent delays from regulations, SolarCity would benefit
from acting quickly when expanding into Brazil and hiring a professional with experience in
maneuvering the Brazilian red tape to prevent delaying their entry.
Competition in Brazil would focus around the three biggest winners in the first solar power
auction: Solatio Energia, Renova Energia SA, and Italian provider Enel Green Power. These
three companies won the rights to provide 70% of the capacity auctioned on October 31, 2014
(Dezem). While they are the largest competition, SolarCity will succeed in differentiating
themselves to customers by copying their business model into Brazil and focusing on individual
systems rather than large-scale farms that power the entire grid. By focusing on installing
customized systems directly at the source (homes, factories, businesses, etc.), SolarCity’s
investment will be substantially less as opposed to building the infrastructure needed for solar
farms like their competitors.
SocietalBenefits to Brazil from SolarCity Entry
Solar energy at its core is a benefit to society and SolarCity’s entry will provide numerous other
societal benefits to Brazil. SolarCity systems would reduce carbon emissions by 690 metric tons,
the equivalent of burning 741,000 pounds of coal, for every 1GW created (“Greenhouse Gas”).
Brazil consumes 455,730GW of electricity per year (“Brazil Analysis”). These changes produce
lasting impacts on the society’s health and cleanliness of the community.

13. 12
Energy dependence is at the forefront of every government and a matter of national security.
Through SolarCity’s entrance, dependence on the diminishing supplies of oil and coal would be
reduced. This reduction would not stop at the individual user, excess energy created can be sold
back to the grid to further reduce the dependence on traditional energy and increase solar energy
usage. The spread of SolarCity systems would also reduce the risk involved with Brazil’s
massive dependence on hydropower. Droughts, such as those that occurred in the past, caused
energy rationing in Brazil and left the country looking for alternative renewable sources
("Renewable Energy in Brazil"). Since Brazil attains plenty of sunlight, lifting the dependence on
hydropower through solar energy sources would provide a more stable power system for Brazil’s
citizens.
The opportunity exists for SolarCity to provide power to those who live in rural, off the grid
areas of Brazil. This aligns with the goal of their GivePower Foundation: “To make clean
renewable energy accessible to those who need it most” (“GivePower”). This would give power
to those that did not have it before and create a safer, healthier, and more productive society. By
SolarCity embarking on this initiative, they would give save these communities by eliminating
their need to purchase extremely expensive kerosene and candles. The goal of this initiative
would be to power poorer communities in Brazil, providing a social benefit from SolarCity’s
expansion to a part of Brazil’s society that traditional energy companies have ignored.
SolarCityHolds the Possibility to Impact the World
Rising electricity rates and a growing trend to live sustainable lives create a solar energy market
that is full of potential growth. Specifically in Brazil, where a flourishing middle-class holds
disposable income for the first time, looking to reduce their living costs, and is being
incentivized by the government to consider embracing green technology. SolarCity’s leadership
proved that they can grow a company quickly and create corporate partnerships with
multinational corporations. The next step for SolarCity is to capitalize on the globalization trend
and enter Brazil’s residential, industrial, and governmental markets. Each market provides
unique benefits for SolarCity’s growth while providing numerous benefits to the customers. A
swift entry into Brazil is necessary to obtain the greatest market share and reach the Brazilian
customers before competition arises. SolarCity is creating a lasting influence on sustainable
energy in the United States, and the opportunity exists to continue increasing that impact
throughout the world. This will develop one country at a time, and Brazil holds the greatest
potential to begin SolarCity’s international impact and growth.

14. 13
“P.E.S.T. Survey Scorecard”: Brazil
Critical Factor + - Expansion Implication (so what?)
P:
1. Government has been successful
at investing in expanding companies
+
The government support and investment could
offset risks/costs of expansion and fuel growth
2. Regulatory inefficiency -
Regulation inefficiency can delay the initial
entry into the market, meaning application
should begin early on
3. Corruption in government -
SolarCity will have to learn how to cope with or
bypass inefficiency from corruption
4. Major US trading partner +
This means that the path has been paved
logistically and there are examples of how to
become a legal entity in Brazil
5. Growing relationship with US
government
+
Brazil is seeking transportation connections
with US, helping the logistics of getting
products to Brazil
E:
1. Growing middle-class +
A middle-class will be one of the main targets
for SolarCity, so this means a growing target
2. US Dollar is strong in Brazil + This will reduce relative cost of expansion
3. Brazil Development Bank solar
import rules
+
Brazil has allowed solar imports to spur
increased use of solar power
4. Rising inflation rates - Could reduce consumer’s demand
5. High electricity rates + Solar would make electricity rates cheaper
S:
1. Government is encouraging
middle-class to live sustainably
+
Government support of sustainable lifestyles
will increase demand for solar power in Brazil
2. Increased education performance +
Future labor force and consumers will be more
skilled and apt to take part in new technologies
such as solar
3. Collective-centered society +
This would increase support for communal solar
projects since it would benefit everyone
4. National language is Portuguese -
Employees who work between the countries
need to be bilingual or they will need translators
5. High urban population + Target market would be in focused areas
T:
1. Increased communication
investment
+
Created for the World Cup and Olympics, the
communication infrastructure will be able to
hold increasing demand for bandwidth
2. Weak technological infrastructure - Small amounts of R&D will come from Brazil
3. High sunshine rates +
This provides a market for the solar panels to
connect enough solar to make it feasible
4. Decreased labor costs + Cheaper labor will decrease production costs
5. Ample access to ports +
Importing materials will be simpler with
Brazil’s many, easily accessible ports of entry

15. 14
“P.E.S.T. Survey Scorecard”: Chile
Critical Factor + - Expansion Implication (so what?)
P:
1. Increased government
transparency
+
This would reduce inefficiency due to
corruption and other covered up actions
2. Many trade agreements +
Trade agreements can reduce import/export
costs for SolarCity
3. OECD Member +
Partnerships create better trade and economic
environment
4. Required enlistment of men -
This would delay or prevent recruiting
promising employment candidates
5. Democratic government +
Rule of law would prevent any unforeseen
destructive acts against company’s assets
E:
1. Positive economic growth +
This would increase the demand for things
such as solar power
2. Large foreign investments + Foreign investment in solar would be accepted
3. High economic freedom ranking + Less inefficiency would occur from regulations
4. Decreased unemployment +
Employed people are more likely to invest in
solar power
5. Dependent upon single industry -
Any destruction of this industry could cripple
the country’s economy
S:
1. Human rights abuses -
Employees would be susceptible to these
abuses
2. Increased urbanization + Increased density of target market
3. Small population - Target market would be relatively small
4. Stark contrast between classes - Target market would be limited by classes
5. High quality of life +
Chileans value life-enhancing qualities such as
renewable energy
T:
1. High sunshine rates +
This provides a market for the solar panels to
connect enough solar to make it feasible
2. Skilled labor force + Laborers will be able to handle complex tasks
3. Substantial ports of entry + Easy access from US/China for imports
4. Labor unions actively strike -
If business is done with any type of union, a
strike is a risk
5. Relatively high labor costs - Increased labor costs would reduce margins

16. 15
“P.E.S.T. Survey Scorecard”: Morocco
Critical Factor + - Expansion Implication (so what?)
P:
1. Corruption -
Inefficiency would be created due to having to
avoid or becoming a victim of corruption
2. Government interference by King -
He has great influence on matters and can
affect change at any time, meaning assets could
be lost if something changes negatively
3. Increased trade freedom + This would allow for easier import of products
4. Difficult regulatory system - Increased costs and time lost from regulations
5. Trade agreement with China/US +
It would be easier and cheaper to import our
products from China and the US into Morocco
E:
1. Increased financial freedom +
Consumers would have more freedom to spend
on things such as solar panels
2. Increased Foreign Direct
Investment
+
Acceptance of FDI increases the ability of
capital for SolarCity to use to expand
3. Dependent upon agriculture -
By being heavily dependent on one industry,
any disaster to that industry would affect sales
of goods such as solar panels
4. GDP Growth +
Increased GDP can equate to increased
investment into areas such as renewable energy
5. Increased inflation -
Increased inflation would reduce the
purchasing power of consumers and strain their
budget to decrease investments in solar power
S:
1. High unemployment +
For many this is a negative, but would mean
relatively cheaper labor for SolarCity
2. Increased education rates +
Consumers will become more informed and
workers will become more skilled
3. Strong cultural differences from
US
-
Business culture and personnel would have to
be adapted to work in Morocco
4. Decreased status of women -
Women workers moving to Morocco may find
difficulties in Moroccan work environment
5. Collectivist society +
This would allow SolarCity to play into the
selling point that solar is good for everyone
T: 1. High sunshine rates + Solar energy need sunlight be effective
2. Great communication
infrastructure
+ Communication will be reliable
3. Key waterway and port access + Getting supplies to Morocco would be simple
4. Increased investment in solar
energy
-
Solar investments and government support
could help streamline business set up and
support would be strong from the government
5. Best transportation network in
Northern Africa
+
Getting products and installers around the
country would not be hindered

17. 16
Works Cited
Barros, Pablo. "Encouraging Brazil's Emerging Middle-class to Buy Sustainably." The Guardian.
Guardian News and Media Limited, 6 Aug. 2014. Web. 27 Nov. 2014.
Basenese, Louis. "10 Reasons Why the Sun Won't Shine on SolarCity's IPO (Part 1)." Wall
Street Daily Stocks. Wall Street Daily, 6 Dec. 2012. Web. 22 Nov. 2014.
"Brazil Analysis." U.S. Energy Information Administration (EIA). U.S. Department of Energy, 1
Oct. 2013. Web. 1 Dec. 2014.
"Brazil Economy." Conservative Policy Research and Analysis. The Heritage Foundation, 201.
Web. 19 Nov. 2014.
"Brazil's poor schools: Still a lot to learn." The Economist. The Economist, 4 June 2009. Web.
26 Nov. 2014.
Bullis, Kevin. "Why SolarCity Is Succeeding in a Difficult Solar Industry." MIT Technology
Review. MIT Technology Review, 4 May 2012. Web. 27 Nov. 2014.
Denning, Liam. "Throwing Light on Value at SolarCity." The Wall Street Journal. Dow Jones
and Company, 11 May 2014. Web. 28 Nov. 2014.
Dezem, Vanessa. "Brazil Development Bank to Allow Solar Imports Until 2020." Bloomberg.
Bloomberg, 31 July 2011. Web. 28 Nov. 2014.
Dezem, Vanessa. "Solatio, Renova and Enel Biggest Winners in Brazil Solar Auction."
Bloomberg News. Bloomberg, 3 Nov. 2014. Web. 19 Nov. 2014.
"Foreign Trade - U.S. Top Trading Partners." Census.gov. U.S. Census Bureau, Nov. 2014. Web.
28 Nov. 2014.
"GivePower Foundation | SolarCity." Solar Panels, Solar Power Systems & Energy Efficiency |
SolarCity. SolarCity, 2014. Web. 2 Dec. 2014.
"Government Solar Panel Installation Projects | SolarCity." Solar Panels, Solar Power Systems &
Energy Efficiency | SolarCity. SolarCity, 2014. Web. 27 Nov. 2014.
"Green Buildings & Renewable Energy: Rio de Janeiro." Renewable Energy and Sustainable
Green Buildings: Rio de Janeiro. Rio Renewables, 2013. Web. 28 Nov. 2014.
"Greenhouse Gas Equivalencies Calculator | Clean Energy | US EPA." US Environmental
Protection Agency. US Environmental Protection Agency, 16 Apr. 2014. Web. 2 Dec.
2014.
Groom, Nichola. "SolarCity unveils new loan that will give customers tax credit." Reuters.
Thomson Reuters, 8 Oct. 2012. Web. 22 Nov. 2014.
"In Brazil, an Emergent Middle-class Takes off." World Bank. The World Bank Group, 13 Nov.
2013. Web. 01 Dec. 2014.

18. 17
Lopez, Blanca. "Brazilian regions move forward." PV Magazine: Photovoltaics Markets and
Technology. PV Magazine, Apr. 201. Web. 28 Nov. 2014.
Markey, David, Akin Gump, and Thomas Byrne. "Emerging Markets Take Over Renewable
Energy Landscape." Renewable Energy World. Renewable Energy World, 28 Dec. 2012.
Web. 27 Nov. 2014.
Messenger, Stephen. "Brazil Signs Into Law Bill to Cut CO2 Emissions 39% : TreeHugger."
TreeHugger. MNN Holding Company, 31 Dec. 2009. Web. 25 Nov. 2014.
Michaels, Wade. "What I Learned About SolarCity's Business Model by Becoming a Customer
(SCTY)." Stock Investing Advice | Stock Research. The Motley Fool Market Insight, 18
Apr. 2014. Web. 21 Nov. 2014.
Musk, Elon, Peter Rive, and Lyndon Rive. "Solar at Scale." SolarCity. SolarCity, 16 June 2014.
Web. 27 Nov. 2014.
Orihuela, Rodrigo. "Brazil's Cheaper Electricity Comes at a Cost - Businessweek."
Businessweek. Bloomberg, 7 Feb. 2013. Web. 28 Nov. 2014.
"Renewable Energy in Brazil." The New Economy | Clean Tech and New Energy Awards 2012.
World News Media, n.d. Web. 1 Dec. 2014.
“Renewables 2014 Global Status Report.” Rep. Renewable Energy Policy Network for the 21st
Century, 2014. Web. 28 Nov. 2014.
Sears/Vectren Corporation, Robert. Phone Interview. 2 Dec. 2014.
Shahan, Zachary. "Solar PV market 2014 — 7 predictions." ABB Conversations. ABB Group, 6
Jan. 2014. Web. 1 Dec. 2014.
Shahan, Zachary. "World Solar Power Capacity Increased 35% In 2013 (Charts)."
CleanTechnica. CleanTechnica, 13 Apr. 201. Web. 1 Dec. 2014.
"Solar Energy System Projects - Solar Power Panel Projects." Solar Panels, Solar Power Systems
& Energy Efficiency. SolarCity, 2014. Web. 28 Nov. 2014.
"Solar Panels for Home - Residential Solar Power & Costs | SolarCity." Solar Panels, Solar
Power Systems & Energy Efficiency | SolarCity. SolarCity, 2014. Web. 2 Dec. 2014.
"Solar PPA Financing - Residential Solar PPA Providers - SolarCity." Solar Panels, Solar Power
Systems & Energy Efficiency | SolarCity. SolarCity, 2014. Web. 28 Nov. 2014.
Teixeira, Marcelo, and Anna Flávia Rochas. "Brazil Readies Big Push on Solar Energy but
Companies Are Wary." Reuters. Thomson Reuters, 11 Mar. 2014. Web. 21 Nov. 2014.
“The Buys from Brazil.” The Economist. The Economist Newspaper, 19 Feb. 2011. Web. 19
Nov. 2014.

19. 18
Wesoff, Eric. "Google Goes $280M Long On Solar Rooftops With SolarCity : Greentech
Media." Green Technology | Cleantech and Renewable Energy News and Analysis.
Greentech Media, 14 June 2011. Web. 28 Nov. 2014.
"Which countries receive the most sunlight?" Rice University. Rice University, n.d. Web. 22
Nov. 2014.
Woodcock, Bill. "On Internet, Brazil is beating US at its own game." Al Jazeera America. Al
Jazeera America, 20 Sept. 2013. Web. 2 Dec. 2014.
"World Economic Outlook Database." IMF -- International Monetary Fund. International
Monetary Fund, 1 Dec. 2014. Web. 2 Dec. 2014.
"2014 Corruption Perceptions Index." Transparency International - The Global Anti-Corruption
Coalition. Transparency International, 2014. Web. 28 Nov. 2014.