The head of structured finance at the solar project development arm of an Asian company has left the firm as it scales back its operations in the U.S.
The official, Roger Johanson, was 18 months into his second stint with GCL New Energy in San Ramon, Calif., where he was a senior director.
His departure comes as the developer's Chinese parent company, solar panel manufacturer GCL-Poly Energy Holdings, grapples with upheaval in its home market, say deal watchers.
“U.S. subsidiaries of Chinese panel makers are having tough time getting equity support from H.Q.,” says a project finance banker. “In China, they sell a lot of panels because of government subsidies but the government has cut back.”
In May, China's National Development and Reform Commission issued a notice halting subsidies for all utility-scale solar installations in the country and revised its quota for distributed generation to 10 GW.
The move surprised market watchers and "suggests the country is aggressively taking steps to control the growth of the market and its outsized subsidy program," wrote equity analysts at Goldman Sachs in a June 4 note to investors.
“GCL run all their subsidiaries out of China and don’t give them much autonomy,” says another deal watcher. “They were hit when China changed its feed-in tariffs, so that would be causing them problems at home and leading to cut-backs abroad."
In September, Moody's Investors Service placed its ratings for GCL New Energy Holdings on review for downgrade, citing in part the policy change in China.
"Moody's expects that the heightened business volatility arising from the challenging industry environment will continue to cloud GCL-Poly's financial performance over the next 12-18 months," wrote the analysts. "In particular, the recent government policy to curb capacity expansion in solar power will temper sentiment in the upstream market."
More recently, China's National Energy Administration has held talks with domestic solar companies to discuss potentially favorable policy shifts, but analysts note that any change would require a careful balancing between installation targets and the costs of any subsidies.
Johanson’s first stint with GCL spanned from 2011 to 2015. Between leaving the company and returning to it in July of last year, he held positions at Cimarron Solar, Ecoplexus (PFR, 7/27/16) and Renewable Energy Trust Capital (PFR, 4/1/15).
Before joining GCL the first time around, he worked in banking at Bank of America, CIT Bank and GE Capital.
He began his finance career at GATX Capital Corp. in 1988, where he spent 13 years, according to his profile on professional networking site LinkedIn.
(Additional reporting by Richard Metcalf).