July 2012 www.solarpowerworldonline.com
Technology • Development • Installation
INSIDE: >> DEVELOPMENTS Page 4
>> PROJECT REVIEW Page 8
>> Installation Practices Page 44
The State of the
Solar Panel Page 16
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ALL SOLAR ENERGY IS NOT CREATED EQUAL At SolarWorld, we believe our energy is different because we’re different. Can you imagine driving a solar-powered vehicle around the globe? We can. In fact, the SolarWorld GT will finish its circumnavigation this year, setting a record for the most miles driven by a car powered entirely by the sun. We were equally ahead of our time more than 35 years ago, when we started manufacturing solar panels in the United States. We wanted to make solar accessible to every American home and business. As yesterday’s vision fast becomes today’s reality, we will continue to apply our experience and know-how in leading the industry around each bend in its journey.
We’re SolarWorld – America’s authority on solar.
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Editorial Advisory Board Natalie Wiener Solectria Renewables Jose Gomez Ingeteam Raheleh Folkerts Renewable Energy Systems Americas Steve Hogan Spire Gary Mull Westinghouse Solar Devon Cichoski SolarWorld Marcelo Gomez Unirac Justin Barnes North Carolina (State University) Solar Center Scott Wiater Standard Solar
What do you think? Discuss this, and other solar issues at www.engineering exchange.com
THE
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We Have To Un-Rig The System
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hope someday to shake the hand of David Roberts, the writer who covers “energy, politics and more” for the online magazine Grist. He wrote a spectacular piece on why the fossil fuel industry will always win in battles against renewables. For those of you who don’t have time to read the whole article (although I highly recommend you do), I’ll summarize the gist of it for you. Let’s start with direct subsidies — money that is handed over to various energy industries to manipulate the markets in favor of certain industries. The verdict? The oil and gas industries have received — and continue to receive — immensely larger subsides than any of the renewable energy sources. Some will inevitably call me a liar when I say tax breaks are a direct subsidy. But no matter how many times I hear this, I know they are wrong. But Roberts touches on a much greater point that I have not seen brought up elsewhere: There is absolutely no way renewable energy can compete with fossil fuels on a level playing field. None. That’s because the oil and gas industries built the playing field. Our entire economic infrastructure centers on the idea that oil has been — and will always be — cheap, now and forever, amen. Oddly, the economic powersthat-be haven’t figured out yet that: a) We have either reached or are approaching (some say we’ll peak in 2016) something called Peak Oil (the tipping point at which we have extracted as much oil as can reasonably be taken from the earth — after which there will be increasingly less to take out until there will be no oil left to extract); and b) Regional instability of most oil-producing countries will cause prices for oil and gas to fluctuate wildly, bringing constant instability to energy prices and having potentially crippling effects on a recovering economy. To quote Roberts: The simple fact is that modern industrial society was built by, around and for fossil fuels. The assumption of cheap, concentrated sources of energy is embedded into all of our institutions and practices. Maintaining our status quo industrial infrastructure — a cost that absolutely dwarfs direct subsidies to fossil fuels — is an investment in fossil-fuel dominance. And we pay it every year, even as we pay the rising costs it imposes on us. Viewed in this light, fossil fuels and renewables are not really “competing” on some common “playing field.” Fossil fuels built the field; it is designed for their game. Renewables don’t just have to produce energy at competitive prices, they must bring along with them new applications, new infrastructure, new institutions and practices. To switch from fossil fuels to renewable energy is not like going from Coke to Pepsi; it is to build a new world. To those of us in the solar industry, this is the task we have in front of us. We must build a new world. We must create new infrastructures. Our time is now. Let us seize the moment.
Frank Andorka Editorial Director fandorka@wtwhmedia.com
www.solarpowerworldonline.com
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w w w. s o l a r p o w e r w o r l d o n l i n e . c o m
contents
7 D e pa r t m e n t s
08 Project Review 13 Racking and Mounting 54 Products 60
59
Contractors Corner
Ad Index
•
16 The State of the Solar Panel: Installers
Trade issues with China have put the panel industry into flux.
22 The State of the Solar Panel: Manufacturers
The solar panel manufacturing industry has a storied past and could have a bright future — depending on which path it chooses to take.
28 Six Stages Of Solar Bankability
To ensure the availability of capital for solar electric power generation, developers need to mitigate risk. Here’s how to do it.
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36 Navigating By Sun
About the Cover:
U.S. Department of Energy takes agressive lead as early adopters of solar energy.
This month’s cover by SolarWorld of
44 A Seamless Solar Solution
Solar roofing that’s easier for homeowners to understand.
photo was provided Hillsboro, Ore. The photo shows the solar cell production
49 Under The Roof
process.
A new University of Texas study reveals how households decide to install PV.
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04 Developments
2012
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01 The First Word
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[D EVELOP MEN T S
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Heliostats for the Home
Solar Innovations Inc. can include solar panels in many of their custom architecture designs for residential and commercial installations.
Every day we turn on lights inside while the sun is shining outside. It seems crazy when you think about it. One often proposed solution is to use a heliostat, which is a mirror mounted on motors that tracks the sun throughout the day and places the sun’s reflection on a fixed spot like the window of a house. But heliostats traditionally have been expensive, costing thousands of dollars a pop, and only suitable for government research. A team of engineers and manufacturing experts at Wikoda Inc. in Concord, Massachusetts have developed what they say is the first and only heliostat designed and priced ($399) for residential use. The company says this option enables homeowners to add brightness and warmth to dark or gloomy rooms. A single heliostat reflects up to 50,000 lumens of sunlight (one 60 watt bulb provides 1000 lumens) and can 4
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transform the mood of a room. Based on a typical $0.15 per KWh cost of electricity, the Sunflower Home Heliostat provides the equivalent of $2 per day of free natural lighting each sunny day. The manufacturer says the heliostat provides $200 to $600 of free lighting per year, depending on local sky conditions, making great use of renewable energy with fairly rapid payback. Unlike heliostats intended for industrial purposes, a home heliostat does not require any programming or scientific knowledge to set up. The computer, motion servos and sun sensors are all onboard and self contained. It doesn’t even need batteries or a power cord because the heliostat is solar powered. All that is required are a screwdriver, wrench and a sunny patch of yard. People have used heliostats to brighten rooms, grow indoor plants, provide warmth, melt icy roofs, dry
clothes, dry woodpiles, discourage moss or mildew and jumpstart spring flowers. Once up and running, the heliostat steers a beam of natural sunlight to a location of the owner’s choice while saving money and producing clean energy. Interest in heliostats is spreading worldwide, according to Wikoda. In fact, demand from countries like Australia, the UK, France, Germany, Italy, Belgium, New Zealand and the Netherlands was high enough for the company to push for and receive the European CE certification on an accelerated schedule to allow shipping into those regions. These new markets are in addition to the domestic United States market for which the heliostat had already received FCC government approval. SPW Wikoda Inc. www.homeheliostat.com
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University of Mississippi Hosts State’s Largest Rooftop Solar System Mississippi was recently ranked on the Optimal Deployment of Solar Index (ODSI) as one of the top 10 states in the US most ideally suited for the deployment of solar due to high energy costs and job creation potential. The state is living up to their reputation with a recent 105-kW system at the University of Mississippi’s Center for Manufacturing Excellence—the largest rooftop solar energy system in the state. Louisiana-owned Joule Energy installed the system using Suniva ART245 and Sun Power E 19 panels. With on-site and online energy monitoring capabilities, the system will serve as a hands-on
teaching tool for studying solar within the university’s curriculum. Such a premier system called for innovative mounting. The project used 431 of Renusol’s CS60 models, which the company says is the first mounting system that uses one unit per PV panel. “With the University’s commitment to advanced technology in LEED certified buildings across the campus and a commitment to teaching manufacturing excellence, it’s fitting that the latest in solar technology was incorporated in their renewable energy initiatives,” says Bart Leusink, Renusol America’s President and CEO. “This mounting system represents the latest and best in
American technology and innovation.” Renusol says its system is changing how solar arrays are deployed on U.S. flat rooftops by eliminating the layout restrictions inherent to traditional, rigid aluminum racking rails. Manufactured in the Midwest, the company says the model offers several solutions developed specifically for the domestic market. Developing the mounting system involved reviewing data from Americanbased wind tunnel studies, which demonstrated how wind forces vary across a roof. Renusol took these results into consideration when designing its flexible system. SPW Renusol www.renusolamerica.com
The InstaRack10’s flexibility made it possible to work around skylights and maximize harvestable rooftop space.
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In the world of solar... ...it’s a good sign. Find out how Solar Frontier’s CIS modules yield more kilowatt hours. C
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Solar Trackers Help Capture 22% More Energy
Opel Solar Inc. is a supplier of single and dual axis solar tracker systems and high concentration photovoltaic (“HCPV”) solar panels, and a semiconductor device and process developer. The company says its TF-800, ground-mounted, single-axis tracker features easy installation and programming that reverses the motion of the tracker to eliminate inter-row shadowing. This allows for bigger systems to be installed in smaller areas. A complete 10-kW system can be assembled in less than 4 hours without the need of special machinery, tools or welding in the field. The company’s trackers were used in a solar installation at the Aquarion Water Company’s D.W. Loiselle Water Treatment Plant at Trap Falls Reservoir in Shelton, Connecticut. Construction began on the project in September of 2011. After successful completion and generation of electricity, The United Illuminating Company approved of the facility in December of last year. The solar facility uses both TF-800 singleaxis and SF-45 dual-axis trackers. Because of the www.solarpowerworldonline.com
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trackers, the Aquarion project is expected to produce approximately 43 MWh of energy per year, representing about 22% more energy than would be expected from the same panels in a fixed installation. The project offsets the energy required to operate the water facility. As part of the agreement, OPEL built and now operates this solar power plant. Leon M. Pierhal, Opel Technologies CEO, says this is first installation for the company at a private or municipally-owned water plant. “Our solar tracker installations are an ideal, cost effective model for private utilities and municipalities worldwide,” he says. “Having this facility to demonstrate to customers visiting our headquarters reinforces the interest in our systems.” SPW Opel Solar Inc. www.opelinc.com 7 • 2012
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A Balancing Act eIQ’s parallel solar technology solves panel mismatch for aggregate and hot-mix facility.
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ranite Construction’s new 1.2-MW solar system is up and running at its aggregate and hot-mix facility. The company has its eyes on a four-year return-on-investment, improved power management, optimization of its modules and the benefits of a parallel construction, rather than modules set in series. A key cog in the system’s photovoltaic array is the reduced complexity of San Jose, Calif.-
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based eIQ Energy Inc.’s parallel solar technology, which boosts the output voltage of copper indium selenium (CIS) thin-film solar modules to the optimum level for the array’s central inverters. These inverters feed solar energy into the power grid and are expected to offset up to 50% of the facility’s total energy requirements. Commissioned in October and operating since spring, Granite is already seeing favorable results.
“The project took a while to complete, and we had decisions to make,” says Sean Kilgrow, Granite’s director of renewable energy business development. “But we’ve been up for a few months and things are running great, with no problems at all.”
Hurdles To Clear Finding panels for the project was difficult — and more expensive than panel prices now, Kilgrow says. Granite first began seeking out prices in
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2009. According to Kilgrow, Granite’s suppliers had committed most, if not all, inventories to foreign projects, particularly in Germany. Andrew Truitt, principal of Truitt Renewable Energy Consulting and senior energy consultant of Denverbased SRA International, says the demand and cost for solar panels peaked from 2004 to 2005, when costs were as much as $4.50 per watt. Today, the cost is closer to $1 to $1.50 per watt, he says. Eventually, Granite found panels – 13,716 of them, to be exact. They ran about $2 a watt, Kilgrow says. About 10,000 of the panels were 85-watts, while the rest were 80-watt panels. This was problematic because panel mismatch can harm performance. Panels degrade at different rates, and if one panel goes out in a common series the entire series goes out. “We had a very large investment in panels,” Kilgrow says. “Today, the cost of these panels is 50 percent of what they were when we purchased them. To protect our investment and keep the project pointed toward savings and success, we had to consider a power-
management solution.” Oliver Janssen, chief business officer of eIQ Energy, feels that “power management” only partially describes the performance of the company’s vBoost DC Parallel System. “The eIQ energy solution was less expensive to install than comparable series architecture,” Janssen says. “It also provides long-term operational benefits by minimizing the effects of shading, soiling, panel mismatch and other issues that can reduce the electrical output of panels wired in series.”
Providing Balance Janssen describes the eIQ system as a complete electrical balancing system. “Modules within the photovoltaic array produce DC power, and an inverter converts it to AC power. In between is where eIQ, the electricalbalancing system, equalizes everything outside of the inverter.” In series architecture, each module puts out different voltages. If a grid needs 350 volts, a series will add it up no matter where it comes from. With eIQ and in a parallel architecture, each
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module puts out 350 volts, Janssen says. Panel mismatch, in particular, was a significant concern in Granite’s solar system. The output of the lowest panel greatly affects how the system produces power, according to Truitt. There can be huge power swings. eIQ’s vBoost system solved the problem. It put intelligence for the system into the field and away from the inverter — monitoring every fourth panel in the array rather than only at the inverter. Measuring at the inverter means waiting for more panels to go bad to find areas of inefficiency, Janssen says. eIQ’s system includes data monitoring, which means the grid can be assessed from a desktop. In a system of this size, the largest of any at an aggregate facility, it is more important to be able to shut down sections of the grid, Kilgrow says. This is especially true in California, where Pacific Gas & Electric (PG&E) rewards curtailment with a netenergy-metering program under which it rewards performance. “Curtailment is rewarded by the state,” Kilgrow says. “Monitoring the field on every fourth panel allows us to pinpoint where we’re using the most energy, and where using energy has the most value. So we can curtail, realize benefits and keep our energy focused on generating business and making profits — and we get rewarded for it.” Performance bonuses, efficiency and safety were major considerations when planning and financing the system, Kilgrow says. Granite is rewarded about 20 cents per kilowatt hour, for which PG&E writes them checks on a regular basis. This was attractive to financers of the costly project. They wanted guarantees that Granite would know what was going on and be able to communicate it to them, if necessary. Finally, safety is a major benefit of Granite’s system. On a sunny day, for example, a company might see a peak in voltage, perhaps even lethal voltage. eIQ’s system identifies the location of the problem and allows managers to dispatch maintenance personnel to the right modules. Inverters alone can’t see specifically what’s causing problems, Janssen says. Looking into the future, Truitt says lower module costs will at some point make optimizers less economical. Rather than invest in optimizers, one could simply buy more modules at a lesser cost. But users of eIQ’s electrical-balancing technology feel quite happy with its output and efficiency in any climate.
“We’re pleased using eIQ’s technology,” Kilgrow says. “The economic benefits of their parallel structure made this project more affordable for us to build renewable energy at our facilities here in California.” SPW
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Making Solar Suitable Quick Mount PV’s flashed mounts enabled a solar installation on America’s oldest net-zero home.
As founder and host of Greenovation TV (www.greenovationtv.com) and consultant on net-zero energy, among other things, it’s no surprise Matthew Grocoff wanted to have his own net-zero home in Michigan. Such a home produces as much or more energy than it consumes. After lots of planning, Grocoff and his wife realized their dream, committing to energy efficiency without sacrificing comfort. From CFL lights to low-flow showerheads, the Grocoffs were committed to energy efficiency throughout the home. They even have a chicken coop (formed from a neighbor’s old playhouse). One of the key elements of this “Mission Zero” home is its 8.1-kW solar system. Grocoff says he decided to install solar because it has reached the tipping point where it’s significantly more cost effective than paying for grid power from the local utility company. “We know what the future cost of the sun’s power is going to be years from now, but we don’t know what the cost of coal will be even 15 minutes from now,” Grocoff says. The decision to go solar was an easy one, but convincing the Ann Arbor Historic District Commission to approve putting solar in Grocoff’s 110-year-old house was challenging. “In a hearing for another similar solar request, the commission approved,” Grocoff says. “But their reasoning was that the guy wasn’t asking to do solar over the whole roof. And this was exactly what I was
planning to request. Understandably, I was a little nervous.” But Grocoff worked with The Solar Specialist, a division of Mechanical Energy Systems Inc., (www.mes1.com) to develop a solution that won unanimous support from the commission in the end. SunPower’s Signature Black solar panels blended in against the home’s asphalt shingles. The team also chose Unirac’s SolarMount racking with Quick Mount PV’s black-anodized flashed mounts to help blend with the roof and panels so the panels could be installed edge to edge across the roof. Besides mounting close to the roof and enhancing appearance, the Quick Mounts did not require cutting shingles.
Type: Roof Mount Size: 8.1 kW Energy Generated: 9.4 MW annual production (8,415 kwh annual consumption, leaving an excess production of about 1,000 kWh) Total Install Time: Just under one week (mainly due to a 12/12 pitch roof) Crew Size: Two for panels and roof work, two electricians for part of the installation Best Installation Day: One crew, about 22 panels (mainly slowed down by roof pitch)
Grocoff Historical Home Project
Number Of Panels: 36 Hours Worked Per Week: About 80 total man hours Savings: Eliminated energy bills for life Racking/Mounting company: Unirac SolarMount racking with Quick Mount PV flashed mounting
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“Once the commission looked at our renderings I think they understood how the system’s appearance and removability would not impact the architectural integrity of the house,” says Grocoff. In addition to the aesthetic appeal of the mounting system, Grocoff required that the mounting would do its primary job in a reliable manner – prevent leaks that could damage the roof and other areas of the home. While this is important for any home solar installation, this assurance is even more critical when installing solar on a 110-year old historic home. Quick Mount PV’s reputation for high quality mounts was a key factor in the choice of mounts. Ron Jones, VP of marketing for Quick Mount PV, says the company’s Classic Composition Mount is designed and engineered to provide 100% codecompliant waterproofing according to roofing best practices. In fact, says Jones, the product exceeds code. Instead of using .032 inch flashing as specified, the Classic Comp uses 0.050-inch aluminum. And while roofing code requires 4 inches of flashing on either side of the penetration, the Quick Mount flashing is 12 inches wide to give over 5.5 inches of flashed surface on the sides of the penetration. “With flashing that is thinner and less wide, the sides can bend up when the mount is tightened down in the middle, especially if it’s over-torqued,” Jones says. This “potato chip effect” is common on inexpensive flashings and often results in wind-driven rain getting under the flashing and potentially causing water damage.
The most innovative component of Quick Mount’s patented waterproofing system is an aluminum flute in the center of the mounting block, seamlessly attached to the flashing, that elevates the EPDM rubber seal 5/8 of an inch above the roof and flashing level where the water flows. “Any rubber seal at the roof level is vulnerable to leaks as rubber seals eventually deteriorate,” Jones says. “When you have a compromised seal at the water level, it will allow water direct entry into the attachment penetration hole. So we elevate and protect the seal from water contact.” Jones says Quick Mount PV is committed to training installers and distributors in roofing best practices for properly installing solar racking and mounting systems. The company offers training sessions around the country to solar installers, electricians, and roofers. The company also offers free webinars every month and has a growing library of instructional videos on its website. Thanks to the right panels, racking, and mounting, Grocoff is able to enjoy his solar system on the nation’s oldest net-zero home. “It’s fabulous,” Grocoff says. “To say I’m happy is an understatement. The only way I could be more thrilled is if everyone who saw or read about my home would take it as inspiration for their own home. We need to redefine ‘home’ as it’s the one we all share that’s more important.” SPW
an d
m o u n t ing ]
Many times, historic commissions are hesitant to approve solar panels for historic buildings. Read more about working with historic commissions on solar in our Project Review in Solar Power World’s May issue or at http://tinyurl.com/energyhomes.
Quick Mount PV Installation The Quick Mount flashing slides under the shingle, eliminating the need for cutting. The hanger bolt with the lag and machine bolt portions, along with an EPDM sealing washer, should be prepped before climbing onto the roof to prevent dropping hardware. The bolt is drilled with a ½ inch socket through the mounting block and into the rafter in one simple motion. The bolt is tightened into place, creating a watertight seal that is raised 5/8 of an inch above the surface. Then an extra, redundant rubber washer is placed into the block’s cavity to prevent standing water in the block. Then an L-foot is attached to the top of the bolt with a fender washer, block washer and driving nut added on top.
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I N S TA L L E R S
• • (photo courtesy of New England CE)
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The State of the Solar Panel:
Differential Diagnosis Trade issues with China have
sent the panel industry into flux — and only the strong will survive
K at h i e Zi pp/ Assi st a n t Ed ito r
The last issue of Solar Power World
featured a piece on The State of the Solar Inverter Industry, in which installers shared their likes and gripes with the electric component. Solar companies had lots to say on panels as well, but, in light of recent events, selecting the right module goes beyond technology and price. The Trade War with China adds another element to choosing the right component. It’s a decision that not only affects solar projects, but also potentially businesses, which impacts the fate of the U.S. Solar Industry as a whole. Panel Policy May 17th was a big day for solar. The Department of Commerce’s decision to place antidumping tariffs ranging from 30 to more than 200% on Chinese solar manufacturers was a shock to most. After the Department’s initial move to place mild 2 to 4% tariffs on the Chinese in March, many didn’t expect anything different this time around. This was Ron
Van Dell’s thinking, President and CEO of SolarBridge Technologies. “I didn’t think it would be so high, neither did a lot of people,” he says. “But I guess it’s not over ‘till it’s over.” What Will China Do? Though it’s possible to say the high tariffs were a shock to most, opinions of what Chinese companies will do aren’t as in line. Some are curious to see how quickly Chinese solar manufacturers can adjust their supply chains—most have already been working on sourcing cells from other countries for months. Others acknowledge that some companies are in a better position to deal with the tariffs than others—not all will be able to adapt. Still, others wonder what Europe will do. Europe has notoriously reacted first in many matters throughout history, but the U.S. took the lead on this one. The greater question is how this decision will affect the U.S solar market here at home.
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T H E S TAT E O F T H E S O L A R P O W E R I N D U S T RY
Mark Begert Executive VP and Director of Meridian Solar www.meridiansolar.com
Mark Durrenberger President of New England Clean Energy newenglandcleanenergy.com
Ron Van Dell President and CEO of SolarBridge Technologies solarbridgetech.com
Effects on the U.S. Solar Market Just as views of how this decision will affect China vary, so do opinions as to what will happen to the U.S. solar market. Mark Durrenberger, President of New England Clean Energy, suggests panel prices will increase in the short term, but will level off in the long run as manufacturers adjust. He also has an opinion as to whether this will encourage people to buy American. “People may buy fewer Chinese modules,” Durrenberger says, “but that doesn’t mean they’ll necessarily buy from the U.S. There are panels from Mexico, Germany and all sorts of other options.” Van Dell says that in some ways this decision may seem like a victory — it may make things tactically troublesome for some Chinese companies — but he doesn’t see it as a way to further American renewable energy. “We have to realize, there’re a lot more jobs in solar than just in panel manufacturing,” Van Dell says. “There’re probably ten times more jobs in design, installation, service and maintenance etc.— and these are local jobs. If we are trying to drive more PV deployment here at home, and more green jobs, then we shouldn’t focus only on modules and manufacturing.” Standard Solar President Scott Wiater says he hasn’t sided on the fight, but expresses disappointment in it. He sees it as just another distraction to the industry. “We don’t need distractions when we’re trying to reach grid parity,” Wiater says. “It’s not a benefit to anyone.”
Van Dell says his company hasn’t been much affected by this decision because SolarBridge Technologies works with a matrix of module partners from all over the world. The company also focuses on residential and light-commercial projects that have smaller panel orders so nothing has been placed on hold, as with some of the larger utility-scale projects. Mark Begert, Executive Vice President and Director of Meridian Solar, says most of the recent projects completed by the company are government-owned and emphasize using American-made products. If not using U.S. products, Meridian uses components from countries with existing U.S. treaties, so the company hasn’t experienced effects of the decision either. Durrenberger, however, has. “One of our suppliers stopped taking imports of at least one product line because of the tariffs,” Durrenberger says. “They literally had the ship turn around. This was a pain for us because we had projects sold using those panels. Fortunately, we were able to find a drop-in replacement.” Selecting a Solar Supplier As if the current political atmosphere hasn’t made selecting a module manufacturer tough enough, solar panels are beginning to show little differentiation from company to company. “The best-in-class guy isn’t much different from the other guys, as he used to be,” Van Dell says. “We look to partner with companies who want to differentiate.”
Scott Wiater President of Standard Solar www.standardsolar.com
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• • (photo courtesy of Standard Solar) 6/20/12 11:44 AM
consolidations in the next few years.
• • (photo courtesy of New England CE) Van Dell says manufacturers can create value for their products by being open minded and different. For example, SolarBridge has teamed-up with a manufacturer of DC modules to integrate their microinverter and so create a true AC Module. Van Dell says AC modules are simpler to install than DC options and have an integrated 25-year warranty, so no inverter replacement is needed half way through the service life of the PV system. He sees AC modules as a better option for installers because these enable completing more projects with the same number of workers. “We’re interested in stepping up to differentiated products,â€? Van Dell says, “rather than companies that say this is trench
warfare and are all about winning on absolute lowest cost. Modules are actually less than half the cost of installing a solar system. Labor and other costs are what get expensive. Innovations such as AC modules address these system cost issues directly.� But each company has its own ideology when it comes to selecting a panel manufacturer. For Durrenberger, it’s all about manufacturer credibility. “Proven technology of three to five years doesn’t excite me,� Durrenberger says. “I have to also warranty these things. Companies who have been around for 35 or 40 years are likely to be around for the duration of the warranty.� Begert says Meridian also looks to partner
with strong, stable businesses. Meridian checks out potential partners through financial and quarterly reports, as well as analyst reports. “Our approach to procuring these key components to a solar system is to work with stable companies with sound balance sheets,� Begert says. “We ask around, do our research and take time to understand the word on the street.� Begert says it’s important to partner with quality manufacturers because customers want to know their products are going to be supported for the life of their systems. “The types of products we specify reflect our expertise, credibility and integrity,� Begert says. “Going with the lowest cost product to make a sale is not a way to create a long-term credible brand.� Performance, installation cost, seamless
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T H E S TAT E O F T H E S O L A R P O W E R I N D U S T RY integration, design resilience and degradation rate are also important factors for Meridian, according to Begert. Thoughts for the Future U.S. solar companies have many thoughts and expectations for innovation and the future of the industry. For instance, Durrenberger predicts increased power density will solve space issues. “The Holy Grail for installers is being able to put more watts up per lift or labor unit,” Durrenberger says. “Fewer parts to connect also eases installation, which is better for businesses.” Begert also says higher performance for lower cost will define success for module manufacturers. He stresses the need to lower solar costs down to the prevailing cost of electricity, but an incentive structure comparable to other types of energy
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generation will also be necessary. Other predictions for panels in the future include: • More consistent size and shape • More AC modules or microinverter compatible DC modules • Increased wattage, perhaps up to 300W • Improvements in manufacturing that will drive down costs • Possibly mixed technology (thin film on PV, perhaps) One common prediction is that solar companies will consolidate. But there are different opinions on what it will take to make it. Begert says module manufacturers that can’t introduce added value, such as financing options, will ultimately struggle. In his opinion, business models also matter. “Manufacturers are best off gearing their
services toward the developer and the dealer community, instead of competing with these parties, moving downstream and attempting to capture these project margins themselves,” Begert says. “This ultimately alienates the module manufacturers from the dealer community.” Van Dell agrees, going back to the idea of differentiation. “It’ll be the ‘tweeners who have no strong differentiation and can’t offer the lowest over-all price that won’t make it.” SPW
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MANUFACTURERS
The State of the Solar Panel:
Image: dreamstim e.com
The View From The Crossroads
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The solar panel manufacturing industry has a storied past and could have a bright future — depending on which path it follows
Fr a n k A n d o r k a / Ed ito r ia l D ir e c to r
In case you haven’t noticed, the solar panel
manufacturing industry has found its way into the news a lot lately. From CNN to CNBC, people have been talking about the future of solar panel manufacturing the way some talked about the future of Apple after Steve Jobs. After all, the solar manufacturing industry is changing rapidly. Nary a day goes by when a press release isn’t distributed that announces new solar panel efficiencies, designs or related services. The intense competition between companies and researchers to improve panel production is exhilarating. But that’s not why so many news outlets are interested in the solar panel manufacturing industry. What has brought panel manufacturing to the forefront is the ongoing trade dispute between U.S. and Chinese solar panel manufacturers. It’s a dispute that is far from settled, but two recent U.S. Department of Commerce decisions (one in March and one in May) make the battle lines abundantly clear.
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T H E S TAT E O F T H E S O L A R PA N E L - M A N U FA C T U R E R S
So solar panel manufacturing finds itself at a crossroads. Whether the solar industry’s future is as bright as its past will depend on which path it follows — and history suggests it will have to choose quickly. “What amazes me is the pace of the industry,” says Gary Mull, vice president of sales and marketing for Campbell, Calif.based panel manufacturer Westinghouse
Solar. He came from the high-tech software industry and has worked in solar since 2007. “It’s extraordinary how much faster change comes to this industry than any other I’ve ever worked in — and that’s saying a lot.” How We Got Here Discoveries related to the solar industry have often come from far-flung places around the
globe, but the refinement and development of the photovoltaic (PV) panel technology that most consumers recognize today was born in 1954 in the United States. Bell Telephone Laboratories (now a subsidiary of French firm Alcatel-Lucent) scientists named Daryl Chapin, Calvin Fuller and Gerald Pearson developed the silicon photovoltaic (PV) cell. The efficiency of that
Discoveries related to the solar industry have often come from far-flung places around the globe, but refinement and development of the photovoltaic (PV) panel technology that most consumers recognize today was born in 1954 in the United States.
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cell (which started at 4% efficiency and only reached 11% at its apex) is dwarfed by today’s cells (which are reported to reach up to 30% or 40% and seem to change almost daily), but it was a start. Today, the industry has spread globally and grown exponentially. “What’s important to remember is that the solar manufacturing presence in the United States has been around for at least 35 years,” says Gordon Brinser, president of SolarWorld Industries America. “SolarWorld has the oldest solar manufacturing base in the Western Hemisphere.” Until recently, however, most panel manufacturers couldn’t produce panels in the necessary volume or price to encourage widespread adoption of solar energy. In 2000, that began to change. Mike Grunow, director of marketing for Chinese manufacturer Trina Solar Americas, says the machines producing solar cells improved dramatically starting 12 years ago. Companies developed wafering and cellproduction technology that could produce highly efficient, high-throughput machines that required less human supervision. In many ways, the solar industry has mirrored the advances in the semiconductor industry. “What you’ve seen in the past three or four years is that the companies with the lowest cost structures are the ones leading the way not only in acquiring and producing significant quantities of solar panels, but also do it at scale,” Grunow says. “They’re not doing at the 100-MW scale — they’re doing at the gigawatt scale.” “Mass efficiencies can be achieved at that level with everything to glass to backsheets and all other components,” he continues. “But the tools themselves aren’t enough — you have to have the know-how to make sure they’re running at optimal levels.” The automation of solar panel production has allowed companies to use thinner substrates, build higher quality products and use more consistent processes, leading to higher quality solar panels, Brinser says. In addition, prices for silicon — the building block for traditional solar panels — have plummeted nearly 50% in the past two years, making some of the “breakthrough”
non-silicon-based technologies like those proffered by the-now-infamous Solyndra obsolete. Isabelle Christensen, marketing director for Chinese solar manufacturer Jinko Solar, says people are often distracted by “new and shiny” technologies rather than those with proven track records. “The top-tier companies focus on producing polycrystalline and monocrystalline technologies,” Christensen says. “It’s only when you are working with proven technologies that you can focus on improving manufacturing efficiency and achieving the economies of scale that will allow the industry to bring down the price of solar for everyone.” As solar expanded globally, numerous companies entered the market. Westinghouse’s Mull says it was inevitable
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that prices would drop precipitously. “New markets opened up, and 30 … 40 … 50 new companies entered the market, all producing essentially the same kinds of panels,” Mull says. “Solar panels had hit that commodity trajectory. What happens? The law of economics takes over and prices fall.” Where We Are Not everyone agrees with Mull’s proposition that the fall in prices is a natural outcome of a cyclical economy, however. In fact, SolarWorld’s Brinser believes the collapse of prices the industry has experienced since 2009 is the result of what the Department of Commerce and SolarWorld see as unfair Chinese competion. SolarWorld filed a two-tiered complaint in October 2011 with the U.S. Department 26
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of Commerce on behalf of the Coalition for Solar Manufacturing (CASM), alleging two separate but interwoven issues: SolarWorld argued that the Chinese government was illegally subsidizing its solar panel manufacturers in virtually all cost inputs. (This resulted in preliminary tariffs on Chinese panel manufacturers that ranged from 2.5% to 4.25% — and the Chinese companies were thrilled). SolarWorld also argued that the Chinese companies benefit from governmental incentive programs that are unhinged from the market forces of supply and demand. (The preliminary decision, which came down on May 17, slapped Chinese manufacturers with tariffs ranging from 31% to 250% — which didn’t thrill the Chinese companies quite as much).
•
•
(Editor’s note: Final decisions on both sets of tariffs are expected to come no later than Oct. 9) If solar panel manufacturing jobs go away, it will destroy upstream jobs in the supply chain and do severe harm to the U.S. economy, Brinser argues (though when pressed to put a percentage or number of jobs he believes could be eliminated, Brinser responded: “It’s hard to put an exact number on it. [SolarWorld Americas] has more than 1,000 jobs in the United States. What’s more important is that it’s not just solar panel manufacturing jobs — manufacturing jobs have a multiplier effect that ripples through entire communities.”) Steve Grippi, business development director of Chinese racking-and-mounting company Clenergy America, says
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U.S. manufacturers are upset because the Chinese build solar panels more efficiently and effectively than they do. “The Chinese are exceptional at what they do,” says Grippi, who, while working for a Chinese company, is a U.S. citizen. “They’re essentially a 51st state of the United States in this global economy. We get our oranges from Florida and we get our potatoes from Idaho because those are best places to purchase those commodities from. Why wouldn’t we get our solar from China? They just produce it more efficiently than we do.” Jinko Solar’s Christensen believes the tariffs are unfair — she says there’s no transparency in how the tariffs were calculated, leaving Chinese companies in the dark as to how and why they’ve been hit. Smaller Chinese companies will suffer the most because bigger companies like Jinko have the ability to source their cells and panels in other countries. “The major Chinese companies will always be around as major players in the global industry,” Christensen says. “It is far more important to promote renewable energy — especially solar — on a global scale than trying to get small competitive advantages for a small handful of companies.” “China will get through this,” Grippi says. “The tariff is a short-term. It won’t stick at its current levels. I have confidence in my government that it will figure this out. Whether we like it or not, we need China on this — that’s the bottom line.” Despite the challenges and conflicts currently roiling the industry, the future of the solar panel industry remains bright, Westinghouse’s Mull says. “The opportunity ahead of us is large, and we will rise above this,” Mull says. “The survival and strength of the United States depends on energy independence. What we need are smart policies that will allow the United States to become a leader on emerging solar power technologies. We’re going to have to work on it, and it’s not going to be easy — but I do believe it’s inevitable.” SPW
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SOLAR BANKABILITY
The Solar Opportunity The solar energy reaching the Earth’s surface is so great that in six months, it’s about equal to all of the energy that can be obtained from all of the Earth‘s non-renewable resources of coal, oil, natural gas and mined uranium combined. Theoretically limitless, the sun has an estimated life span of another 5 billion years and is one of the most passive forms of power generation with zero emissions. Solar electric power has a great deal of appeal for investors looking at opportunities in the renewable energy market. The scalability and flexibility in locating a prospective PV power plant give distinct advantages over other methods of power generation:
• It is relatively easy to assess and
forecast the availability of the resource.
• There is no variability associated with
the cost of the main fuel.
Compared to other renewable sources of energy, solar PV is quick to deploy. A utilityscale solar PV plant can take 1.5 years as compared to an average of two years for onshore wind and up to seven years for a geothermal power plant, according to IHS Emerging Energy Research. Rapid deployment makes solar an attractive solution for states and utilities scrambling to meet their respective renewable portfolio standards and keep up with increasing energy demand. This, in turn, provides an opportunity for investors and developers. Utility-scale solar electric power development does not face quite as many infrastructure concerns as other sources of energy. Since the sun shines to some degree everywhere on the planet, solar power plants
can be placed relatively close to points of consumption, leveraging substations with excess capacity. Locating power generation close to the load results in lower losses due to transmission. Bankability: The Challenge for Solar Developers However appealing solar investment is, developers still need to assess investment risks by considering the following questions:
• Is the technology proven? • Has the EPC demonstrated the ability to deliver the projecton-time and on-budget? What is the anticipated ROI? How quickly can the project start generating a return?
• •
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Generally speaking, bankability in the solar industry is a term used to describe the degree of financial risk. The degree of bankability of any project, solution, technology or supplier will affect the availability and cost of capital. The decisions a solar developer makes during project planning, installation and commissioning can have a significant impact on a project’s risk and associated return. In this paper, we will break the project down into four stages:
1) Site and project assessment; 2) Design and optimization; 3) Procurement; 4) Installation and commissioning;
We will also look at two critical post development stages that continue to affect the project’s total operating costs and return:
5) Maintenance; and 6) Customer enablement.
Site and project assessment When most people think of site assessment, they tend to look at obvious things such as average solar insolation for the region and local site conditions. While it is true that solar can be developed anywhere, utilityscale solar projects make more sense in areas such as a desert where the land is relatively inexpensive and the solar resource is stronger and usually more available. There is more to choosing a proper site than simply finding cheap land in the desert with good solar insolation levels, however.
Developers also need to consider local infrastructure availability and capacity. Solar power plants can be built relatively close to substations with access to transmission lines with available capacity. Siting power plants close to the load or consumer reduces losses associated with long-distance transmission. This flexibility is an advantage over other renewable energy technologies. As with any project, it is crucial to consider environmental and community concerns. Environmental groups have tied up more than one power project with costly legal battles. And local residents, while supportive of solar in general, may have concerns about the appearance of a field of solar modules within their view. Before final site selection, it is important to conduct environmental studies and investigate community concerns so the project is not blocked before it even begins.
Bankability Glossary First Costs: The costs to acquire equipment as well as build and commission the solar power plant. Total Operating Costs (TOC): the sum of all direct and indirect costs that go into operating a solar plant. Both first costs and operating costs affect when a plant ultimately becomes profitable. Levelized Cost of Energy (LCOE): Expressed in cents per kilowatt hour (kWh), LCOE takes into account not only the capital cost of building a project, but also operating and maintenance
Design and optimization Once the site has been selected, design and optimization of the solar plant can begin. Things can get complicated as developers try to strike a balance between first costs, Total Operating Costs (TOC) and Levelized Cost of Energy (LCOE) (see sidebar for full definitions). Here are three ways decisions made during the design phase can affect first costs, TOC and LCOE.
expenses over time, such as the length of a power purchase agreement, the cost of the fuel, etc. LCOE is a crucial metric for solar investors as it is often used to compare the cost of solar energy to other sources. It’s LCOE that determines the long-term profitability of a power plant.
Product design – Transformers are an
important capital item and a critical piece
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SOLAR BANKABILITY
of equipment in a solar power plant. Proper consideration should be given to selecting an appropriate transformer; they are an excellent example of the tradeoffs developers must make between first costs and TOCs. Variables such as the cost and/or price of energy, either generated or consumed, as well environmental and load factors aid in the selection of the ideal transformer. Distribution-type transformers with both traditional grain-oriented electrical steel cores as well as amorphous cores are one such choice. An amorphous core transformer has superior noload loss performance when compared to a more traditional grain-oriented core transformer. The grain-oriented transformer has superior load loss performance to that of an amorphous core transformer. An amorphous core transformer has a higher first cost than a traditional grain oriented core transformer. However, in many cases, a properly designed, amorphous core transformer will deliver a 3 to 5 year payback. Due to the nature of PV solar power, the transformer spends a great deal of time at no-load or lightly loaded conditions, increasing the importance of the no-load loss performance of the transformer. To help developers balance first costs vs. TOC, ABB has developed a TOC calculator to determine the present value of a transformer’s no-load losses (dollars/watt) and load losses (dollars/watt) over the expected life of the transformer. Added to the transformer purchase price, this gives the buyer the TOC over the expected life of the transformer for use in payback models. 32
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Once the TOCs of various designs have been calculated, developers can use the Payback Calculator to help select the optimal transformer design based on shortest payback period, taking into account transformer purchase price, losses and cost of energy. Product selection – Instrument transformers are another one of the many product choices that can impact TOCs and LCOE. Extended range and accuracy are important features of an instrument transformer. Accuracy is crucial to payback, as it allows the utility to capture revenues that might otherwise be lost. For example, if the accuracy of an instrument transformer is off by even 1%, the effect on just one large industrial customer’s annual bill could be as much as $23,000. If a utility has 50 customers of this size, that 1% error can translate into as much as $1.15 million in lost revenues in just one year. Safety should also be a consideration during the design phase, and product selection has a big impact. For example ABB’s arc-resistant medium voltage switchgear reduces equipment damage due to internal faults, increasing equipment reliability and preventing tragic injuries to employees.
System optimization – Even if the solar
developer makes wise choices to minimize first costs while balancing TOCs, the solar plant may not be optimized to provide the greatest return. One illustration of this is a Concentrated Solar Power (CSP) pump optimization project where ABB was able to identify design changes that would provide substantial first cost and total ownership cost savings. The original design of the CSP plant called for 64-inch pipes, three supply pumps, three boosters and five injection pumps. The team was able to optimize the system design by reducing pump size and wall thickness and eliminating the boosters. They even managed to increase capacity of the system by another 10,500 gallons per minute. The results? The company saved $101 million on first-costs, $3 million in energy costs over the estimated life of the plant and $104 million in total costs. Procurement Solar projects can be complex, and funding sources fickle. It is important for developers to complete the solar project while funding is still available and to assure investors the project will operate as planned. Therefore, developers must select suppliers that can deliver as promised.
www.solarpowerworldonline.com
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CentroPack® - German engineered, turn-key packaged systems. To order your custom packs, Go to: centro-pack.com CentroSolar Group AG is one of the leading publicly traded solar companies in Europe, expanding rapidly in North America. We partner with you to deliver successful solar solutions that maximize the return on investment for your clients.
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Call: 1.855.OK.GO.SOLAR [1.855.654.6765] Email: info-usa@centrosolar.com Centrosolar 7-12.indd 33
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Here are a few things to think about when selecting a supplier, whether it’s an equipment supplier or an engineering, procurement and construction (EPC) firm:
• What is their experience in the
market? Do they have the references to support their claims? • What is the supplier’s relationship and experience with utilities and off takers of power to ensure grid integration is successful and efficient? What is the financial strength of • the EPC? How deep is their balance sheet and do they have the financial strength to deliver even in tough times? • Are their products designed for the harsh solar environment? Sand, wind, dust, salt and other elements can wreak havoc on sensitive equipment. • Could supply disruptions and shortages cause problems, or does the supplier have the capacity to minimize these? • What are their testing procedures? Do they test equipment before it reaches your site? While few suppliers provide 100% of the solar solution, developers do well to minimize the number of suppliers they work with to reduce the number of moving parts in any solar project. Installation and commissioning Installing and commissioning a solar plant is different from other types of power plants, with each particular type of solar having its own challenges. One commonality is that solar plants contain a large number of components.
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When installing in harsh environments, special care needs to be given to the handling of these components so they are not damaged during the process. In addition, shipping and delivery of these components need to be coordinated so they are available when needed. If they arrive too early in the process, the risk of damage increases as they can be exposed to the elements while awaiting installation. Solar developers should ensure all contractors working on the job are solartrained. It helps to ensure the vendor in charge of the project has extensive solar project management experience and that project managers are well-versed in managing solar projects. It also helps if they’ve been certified by organizations like the Project Management Association. Maintenance Solar PV power is faster to deploy than other types of power plants, but the average PPA of a PV plant is 20 to 25 years based on the design life of a solar module. This means the solar developer has a shorter window of time in which to achieve and maximize profitability of the plant. To maximize profitability of the solar plant, the developer needs to think about three things:
• • •
Maximizing uptime; Maximizing output and revenue Extending the life of the plant
Asset maintenance – Asset maintenance is a discipline that can help maximize uptime and extend the life of the plant. A key component of asset maintenance is asset monitoring to predict potential failure. For example, ABB offers TEC MonitoringTM, an online power transformer monitoring service that detects gassing and other signs of potential transformer failure. In addition to asset condition monitoring, asset maintenance helps ensure regularly scheduled preventive maintenance. ABB has found utilities that have deployed its Ventyx Asset Management applications can reduce downtime by 20% while reducing maintenance costs by 30%. www.solarpowerworldonline.com
In-field servicing – Technology that allows
in-field servicing can also improve uptime. Using the example of power transformers, again, the challenge in transporting these large machines can make them costly to repair. In-field services, such as oil reclamation and low frequency heating to dry the insulation can decrease downtime, cut costs and extend the life of the equipment. Component selection – The equipment you choose plays a significant role in maximizing uptime. When selecting components, ask about ratings such as Mean Time to Repair (MTTR). Of course, requiring less maintenance is a great way to improve uptime. In addition, suppliers who manufacture and stock components that don’t have to be shipped overseas can decrease downtime significantly. Innovations such as the extended range instrument transformer can be used as a universal spare, decreasing downtime while lowering inventory costs of components on hand.
Customer enablement Solar energy, at least at this stage of its development, is not a primary energy source for most consumers. However, one of the industry’s keys to success is to enable consumers to choose solar over other sources. Demand Response is a technology that helps utilities encourage the use of solar power, and ABB enables this through the Ventyx Virtual Power Plant (VPP). The VPP coordinates solar plants with other forms of energy and allows the utility to supply energy based on factors such as renewable energy portfolio targets. In addition, the VPP allows the customer to set preferences such as energy supplied from solar power regardless of other factors, putting choice in the hands of energy-conscious consumers. Conclusion If solar electric power is to become an important source of energy in our future, the industry needs to work together to make it affordable for everyone. Lowering costs and increasing the safety and reliability of
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solar electric power will make it easier for utilities and consumers to select solar power over other forms of energy. Making solar electric power affordable begins with developing solar electric power plants that have a competitive LCOE. To obtain a low LCOE, a developer must not only control first costs, but focus on minimizing TOCs. Developers must also reduce the risk of solar power projects to attract more investors and lower the cost of capital for those who are interested in funding renewable energy projects. In other words, bankability is key to the future of solar power generation. Solar project bankability doesn’t happen by accident. It takes careful planning during every stage of the project and assistance from experts who have the experience to navigate each stage of a complex project, steering around hurdles like local regulatory, environmental and public concerns. Suppliers with experience in developing products and solutions for optimizing solar projects can save developers, utilities and consumers millions of dollars in first costs and TOCs, as well as dramatically affect the time it takes for the solar plant to achieve profitability. This is an important period in the development of the North American solar power market. The demand for safe, clean, reliable renewable power is growing at an ever increasing rate. The market is looking for large global players like ABB to provide leadership and stability. ABB will be demonstrating its commitment by introducing new technologies and solutions that improve efficiency, reliability, safety and performance of modern solar power systems and will continue to invest in solar electric power solutions to improve its viability and long-term bankability. SPW Discuss This and other Solar issues at www.engineeringexchange.com
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Transformers. Switchgear. Substations. Integrated solutions. Automation. Services.
CG is a global leader in electrical products and integrated solutions. Its products, solutions & services ranges from distribution & power transformers, to medium & high voltage switchgear, to SCADA & automation to complete turn-key substation EPC solutions. CG has proven track-record of on-time delivery & completion at its installed base of more than 20,000 MW in North America, making CG one of the most reliable and preferred equipment & solution provider in renewable market today.
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AWEA
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35
Visit us at InterSolar EU in Hall C3, booth 580, at InterSolar USA at booth 8341 and at AWEA in Hall B, booth 5919
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Navigating by the U.S. Department of Defense Takes Aggressive Lead as Early Adopters of Solar Energy
{
Re be cca “Be ck y ” Halste ad, B r igadie r G e n e r al (re t ire d) a n d Michae l Gorton— CEO an d Ch air m an , P r in c ipal S o l ar
The U.S. Department of Defense (DoD) has a longstanding tradition of accelerating technological innovation, serving as early adopters and impacting the broader commercial market in areas such as aviation, computing and GPS. For the past several years, the DoD has been playing this role in the renewable energy space. In fact, The Pew Charitable Trusts reports that the DoD clean energy investments increased 300 percent between 2006 and 2009, from $400 million to $1.2 billion. Projections for 2030 are set to eclipse $10 billion annually 1, with an overall target of obtaining 25 percent of the DoD’s energy from renewable sources by 2025.2 Driven by climate change and the need for energy security, the DoD’s plans maximize effectiveness during military, disaster relief and humanitarian engagements. As initiatives unfold, the DoD will serve as a laboratory, laying the groundwork for adoption
of new ideas for optimizing efficiency and creating “zero energy” environments (consuming as much energy as they generate). Efficiencies gained from a greater reliance on solar energy have the potential to create energy independence, shrink risks for military personnel in the field, reduce the DoD’s carbon footprint and drive clean-energy innovation in the U.S.
The Challenges As this large-scale mission unfolds, the DoD will have a direct influence on national security and the health of the U.S. economy. Strategies are shaped around overcoming two critical challenges: energy usage and strategic vulnerability.
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Michael Gorton, Chief Executive Officer and Chairman of Principal Solar, is an entrepreneur, mentor and company builder, applying proven strategies in the fields of renewable energy, telecommunications, music and healthcare. Drawing on his extensive business expertise, scientific education and training, Michael serves as a strong voice and proponent of solar power.
Energy Usage The DoD is a massive energy spender, with Deloitte reporting a 175-percent increase in gallons of fuel consumed per U.S. soldier per day since the Vietnam conflict.3 The DoD spends nearly $4 billion a year on powering the 300,000 buildings on its installations.4 In Fiscal Year (FY) 2009, the DoD spent $13.2 billion on energy for fixed installation, equipment and vehicle fuels.5 Federal government energy goals have mandated energy reduction of 30 percent by 2015, with electric energy consumption from renewable energy increased to no less than 7.5 percent beginning FY 2013.6 The DoD’s energy portfolio includes the energy used at military installations around the world and energy used by military forces executing their operational responsibilities, such as fueling ships, ground vehicles and airplanes. It’s costly to acquire, manage, transport, protect and consume fuel at this level. The true cost of fuel use ranges from $10 to almost $400 per gallon depending on distance and delivery method.7 This level of dependence threatens energy security and inhibits military personnel from moving freely, which puts constraints on strategic decision-making. In fact, an overwhelming percent of ground supply chain movements for current U.S. military operations are dedicated to moving fuel—a tremendous logistical burden and major vulnerability for attack.8 Strategic Vulnerability At its current pace of consumption, the DoD is paying too great a cost in lives, expense and compromised capability in response to three major forces:
Rebecca “Becky” Halstead Brigadier General (US Army, Retired) Brigadier General (Ret) Becky Halstead is currently CEO/ Founder of STEADFAST Leadership, a leader consultancy company. Becky is an inspirational speaker, consultant and advisor. She served in the U.S. Army for 27 years, leading over 20,000 soldiers and 5,000 civilians in Iraq, and commanding eight out of her last 11 years in the Army. She provides logistics and leadership expertise to the Principal Solar team.
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Climate Change: The Pentagon has ranked global warming as a destabilizing force and advised military strategists to stay abreast of climate science and factor global warming into their long-term planning. Heat waves and catastrophic storms put more pressure on the military to respond to humanitarian crises or natural disaster. Also, many U.S. bases are threatened by rising sea levels.10 In particular, bases on the East Coast are especially vulnerable to frequent and powerful hurricanes. If sea levels were to rise by one meter, Norfolk, Virginia—an important base of the U.S. Navy— would be flooded.11 While climate change alone is not likely to lead to future conflict, it may be an influence. Climate change is affecting, and will continue to affect, U.S. military installations and access to natural resources worldwide.12
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Oil Dependence: In 2011, the Center for Naval Analysis’ Military Advisory Board called for “immediate, swift and aggressive action” over the next decade to reduce U.S. oil consumption 30 percent in the next ten years, stating that U.S. dependence on oil constitutes a significant threat to the economy, global leadership position, environment and military. Even a small interruption of the daily oil supply impacts the nation’s economic engine, but a sustained disruption has the potential to alter essential economic elements, from food costs and distribution to manufacturing goods and services, and freedom of movement.13 Global oil supply instability also plays an important role, with the need for fuel-independence becoming more imperative every year. The Energy Information Administration predicts imported oil consumed by the U.S. will decline minimally in the next two decades—to 53 percent in 2020 and 56 percent by 2030.14 As the global demand for oil increases, competition for these supplies will increase. The value of oil at risk around the world is high, and a major disruption is an ongoing threat. One study estimated a 25-percent probability that one substantial disruption would occur at a chokepoint before 2014.15 Chokepoints (narrow channels along widely used global sea routes) are a critical part of global energy security due to the high volume of oil traded through these narrow straits. Fragile Electricity Grid: Of the DoD’s electric
energy infrastructure, 99 percent is commercially owned.17 Widespread disruption of electric service can quickly undermine the U.S. government, national security, military operations and the economy, as well as endanger the health and safety of millions of citizens.18 The DoD relies on diesel generators for backup but, typically, these generators are oversized, poorly maintained, dedicated to only one building or facility and cannot share power with other buildings. Additionally, many of these generators have demonstrated low reliability in time of emergency. 19 In short, the DoD faces the same reliability and fuel issues as the civilian sector: aging infrastructure and grids that are susceptible to terrorist attacks and natural disasters. In the event of a large-scale power disruption, fuel resupply on military installations could be seriously compromised because of competing demand for fuel distribution.20
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The US Military Energy Consumption in FY2009 (in trillion Btu) Electricity RES, 3.7 Others, 7.8 Nonspec Liquids, 60.1 Gasoline, 19.4 Fuel Oil, 19.1
Biofuels, 1.0 LPG, 1.8
Distillate, 129.2
Electricity, 98.2 Oil, 731.4
Nat Gas, 74.2
Jet Fuel, 500.6
Coal, 16.2
Source: karbuz.blogspot.com, calculations are based on data from DoD FEMR FY2009
Finding Solutions, Driving Innovation ESTCP: The DoD’s Environmental Security Technology Certification
Program (ESTCP) includes 27 “test bed” projects to test, evaluate and scale up new and innovative energy technology. This is an effort to reduce the $4 billion cost of powering its facilities and improve security.21 The programs main areas include: • smart micro grids and energy storage at installations • advanced component technologies to improve building energy efficiency advanced building energy management and control • technologies • tools and process for design, assessment and decisionmaking associated with energy use and management, and technologies for renewable energy generation Under this program, Skyline Solar, a concentrated photovoltaic (CPV) company, has broken ground on solar power plants at two military bases: Edwards Air Force Base in Southern California and Fort Bliss in Texas. Skyline Solar is using CPV technology, which differs from standard rooftop solar panels in that it uses an optical system to concentrate the sun’s energy onto photovoltaic cells. Fort Bliss, which spans more than one million acres of land in West Texas and New Mexico, is one of several bases moving forward with plans to be “net zero.” Cogenra Solar, provider of distributed solar cogeneration systems, was chosen by the ESTCP for a $2 million contract for two military sites. The U.S. Navy and U.S. Army facilities were selected for diverse building types, climates and hot water usage to expedite adoption of solar cogeneration at other DoD sites. Producing hot water and electricity, the 4 0 SOLAR POWER WORLD
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installations will be evaluated throughout the year for high energy production and cost effectiveness of the technology for military applications.22 These test beds let the DoD evaluate technical validity, cost and the environmental impact of new technologies, while serving as an important bridge between research and deployment. In addition, the DoD has initiated other projects: SPIDERS: A three-phase, $30 million, multi-agency project known as the Smart Power Infrastructure Demonstration for Energy Reliability and Security (SPIDERS), is focused on reducing risks by building smarter, more secure and robust microgrids that incorporate renewable energy. The goal for SPIDERS is to provide secure control of on-base generation. If a disruption to the commercial utility power grid occurs, a secure microgrid can isolate from the grid and provide backup power to ensure continuity of mission-critical loads. The microgrid can allow time for the commercial utility to restore service and coordinate reconnection when service is stabilized. A smart, cyber-secure microgrid allows renewable energy sources to stay connected and run in coordination with diesel generators.23 Mojav and Colorado Deserts: A recent study determined that
the DoD could generate 7,000 MW of solar energy—equivalent to the output of seven nuclear power plants—on military bases located in California’s Mojave and Colorado deserts.24 The area is large enough to generate more than 30 times the electricity consumed by the California bases, or about 25 percent of the renewable energy that the State of California requires utilities to
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use by 2015.25 The DoD plans to develop solar, wind, geothermal and other distributed energy sources on its bases. The combination of on-site energy generation, energy storage and smart-microgrid technology would allow a military base to keep critical operations “off-grid” for weeks or months in the case of grid disruption. This presents an opportunity to reduce a $4 billion-a-year energy bill and create a level of independence from the commercial electricity grid.26 Furthermore, the study determined that private developers could tap the solar potential on these installations with no capital investment requirement from the DoD. The development could potentially net up to $100 million a year in revenue or other benefits, such as discounted power.27 Nellis Air Force Base: At Nellis Air Force Base in Nevada, the Air Force finished installing more than 70,000 solar panels on 140 acres of unused land in December of 2009. The solar panels, called “trackers,” follow the movement of the sun and are connected to the base electrical grid, saving the military roughly $83,000 on its monthly electric bill.28 The Air Force is also investigating green power, including ice storage systems that freeze water at night and then melt it to cool buildings throughout the day.29 Clark Energy Group and Acciona: The
Enhanced Use Lease (EUL) program enables commercial companies to fund, build, and operate projects in exchange for long-term leases of Army land. This program’s first renewable energy project is the Fort Irwin Solar EUL partnership with Clark Energy Group and Acciona Solar Power to build a solar electric power plant with a potential for 1,000+ MW of solar power, making it the largest renewable energy project in the DoD’s history.31 The DoD’s clean energy initiatives seek to reduce dependence on fossil fuels, including greater reliance on more efficient generators and centralized power. Each branch of the military has developed energy-efficiency
strategies based on their particular needs:33 The Navy and Marine Corps are
developing experimental forward-operating bases that use small-scale water purification, energy-efficient lighting and photovoltaic energy harvesting to reduce the need to transport fuel and water over long distances. The Air Force—the DoD’s largest energy consumer—is modifying how it flies its aircraft, changing aircraft altitudes and routes and optimizing aircraft loading, which is predicted to save over $500 million in fuel. The Navy is executing a range of initiatives
in ship coatings, propulsion options, a hybrid-electric drive and a new amphibious ship that is dramatically more efficient. By 2016 the Navy plans to deploy a “Great Green Fleet” powered entirely by alternative fuels. The Army’s installation energy programs include efforts to reduce energy consumption on bases, find ways to lower environmental impact, and implement innovative approaches for reducing energy consumption. Being Part of the Solution: Investment Opportunities
The DoD’s budget for energy security initiatives has risen from $400 million to $1.2 billion in the past four years, and market experts project steadily increased www.solarpowerworldonline.com
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expenditures for energy innovation activities in the coming years.34 But flawed incentives impede investment in energy efficiency for two main reasons.35 The first user bears significant costs but gets the same return as followers, which is problematic for new technologies intended to improve energy efficiency in a retrofit market. The DoD does not have an enterprisewide energy information management system that can provide the appropriate information on energy consumption at various levels of aggregation, including individual building, installation, geographic region and military department. This hampers the DoD’s ability to monitor, measure, manage and maintain energy systems at their optimal performance levels; collect renewable energy generation and performance data; and compare performance across facilities and departments. The DoD is investing more to improve the energy profile of its fixed installations, with financing from annually appropriated funds, including military construction, operations and maintenance, and the Energy Conservation Investment Program (ECIP). In addition, it has used third-party financing through Energy Savings Performance Contracts (ESPCs) and Utilities Energy Service Contracts (UESCs). The DoD is also pursuing other innovative financing approaches, such EULs and Power Purchase Agreements (PPAs). The DOD’S Fundemental Investment Strategy Seeks To: Reduce demand for
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of renewable and other alternative energy sources. Investments that curb demand are the most cost-effective way to improve an installation’s energy profile.
the United States, the DoD is in a position to introduce innovative, clean energy solutions on a large scale. Indeed, the DoD is navigating and pioneering much of the progress made in this sector. By leading the way, they will create Conclusion potential for curbing staggering energy costs Driven by climate change and the need for and optimizing the nation’s overall defense energy security, the DoD’s energy effectiveness strategy. and efficiency plans are designed to maximize These new policies will help to eliminate military performance and personnel safety. hesitation in the mainstream marketplace, As the single largest consumer of energy in leading to accelerated innovation and the
creation of new and profitable markets. By maintaining its current trajectory, the DoD will increase demand for partnerships, private sector financing and a considerable influx of investment dollars into leading-edge research, technology and business practices. For the solar energy world, the DoD’s energy conservation investment program adds credibility to the conversation and helps the military increase power reliability, lessen its need for diesel fuel and reduce its carbon footprint. SPW
ENDNOTES 1. Montgomery, Christopher M.; U.S. military charts aggressive growth in renewable energy; Association of Corporate Counsel; September 28, 2011;http://www.lexology.com/library/detail. aspx?g=5755046a-517d-4113-80c0-7b83cadf0374&utm_ source=l exology+daily+newsfeed&utm_medium=html+email++body+-+federal+section&utm_campaign=lexology+subscriber +dail y+feed&utm_content=lexology+daily+newsfeed+2011-1005&utm_term=; accessed January 19, 2012. 2. Montgomery; September 28, 2011. 3. Deloitte; Energy Security, America’s Best Defense; http:// www.deloitte.com/assets/Dcom-UnitedStates/Local%20Assets/ Documents/AD/us_ad_EnergySecurity052010.pdf; accessed February 27, 2012. 4. SERDP; Department of Defense Announces New Installation Energy Technology Demonstrations for FY 2012; November 18, 2011; http://www.serdp.org/News-and-Events/NewsAnnouncements/Program-News/Department-of-Defenseannounces-new-installation-energy-technology-demonstrationsfor-FY-2012; accessed January 19, 2012. 5. Army Energy Program; January 4, 2012. 6. Army Energy Program; Renewable Energy; January 4, 2012; http://army-energy.hqda.pentagon.mil/renewable/renewable.asp; accessed January 19, 2012. 7. IBM For the Business of Government; Reduce Energy Use: A New Paradigm – Energy for the Warfighter; July 27, 2011; http:// www.businessofgovernment.org/blog/strategies-font-color-redcutcostsfont-and-improve-performance/reduce-energy-use-newparadigm-e; accessed February 28, 2012. 8. IBM; July 27, 2011. 9. Lovins, Amory B.; The THE DOD’s Energy Challenge as Strategic Opportunity; NDU Press; 2010; http://www.ndu.edu/ press/lib/ images/jfq-57/lovins.pdf; accessed February 28, 2012. 10. Goldenberg, Suzanne; Pentagon to rank global warming as destabilising force The Guardian; January 31, 2010; http:// www.guardian.co.uk/world/2010/jan/31/pentagon-ranks-globalwarming-destabilising-force; accessed February 27, 2012. 11. Environmental and Energy Study Institute; Climate Change Impacts and National Security; July 2010; http://files.eesi.org/ climate_security_072810.pdf; accessed March 2, 2012. 12. Department of the Navy memorandum; Navy Climate Change Roadmap; May 21, 2010; http://www.navy.mil/navydata/ documents/CCR.pdf; accessed February 27, 2012. 13. Femia, Francesco, Werrell, Caitlin; Military Advisory Board: Oil Dependency Achilles Heel of U.S. National Security;The Center for Climate and Security; November 7, 2011; http:// climateandsecurity.org/2011/11/07/military-advisory-board-oildependency-achilles-heel-of-u-s-national-security/; accessed March 2, 2012.
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14. Zablocki, Curtis; Crafting the Department of Defense Energy Strategy; United States Airforce Reserve; 2010. 15. Komiss, William, Huntzinge, LaVar; The Economic Implications of of Disruptions of Maritime Oil Chokepoints; CAN; March 2011; http://www.cna.org/ sites/default/files/research/The%20Economic%20 Implications%20of%20Disruptions%20to%20 Maritime%20Oil%20Chokepoints%20D0024669%20 A1.pdf; accessed February 28, 2012. 16. Petroleumworld.com; World Oil Transit Chokepoints; March 5, 2011; http://www. petroleumworld.com/sati11030501.htm; accessed March 2, 2012. 17. Tilford, Robert; Electric grid vulnerabilities present risks to U.S. defense assets; Examiner; February 4, 2012; http://www. examiner.com/city-buzz-in-charlotte/ electric-grid-vulnerabilities-present-risks-to-u-sdefense-assets#ixzz1ngww7AWi; accessed February 28, 2012. 18. Tilford; February 4, 2012. 19. Asmus, Peter; The Promise (and Perils) of Government Microgrid Markets; Pike Research blog; February 25, 2011; http://www. pikeresearch.com/ blog/articles/the-promise-and-perils-of-governmentmicrogrid-markets; accessed February 27, 2012. 20. Stockton, Paul; Testimony of the Honorable Paul Stockton Assistant Secretary of Defense Homeland Defense and Americas’ Security Affairs Department of Defense Before the Subcommittee on Energy and Power The Committee on Energy and Commerce United States House of Representatives; May 31, 2011; http://democrats.energycommerce. house. gov/sites/default/files/image_uploads/Testimony_ EP_05.31.11_Stockton.pdf; accessed February 28, 2012. 21. SERPD; Department of Defense Announces New Installation Energy Technology Demonstrations for FY 2012; November 18, 2011; http://www.serdp.org/ News-and-Events/News-Announcements/ProgramNews/Department-of-Defense-announces-newinstallation-energy-technology-demonstrations-forFY-2012; accessed February 27, 2012. 22. Cogenra Solar; November 29, 2011. 23. Sandia National Laboratories; SPIDERS microgrid project secures military installations; February 22, 2012; https://share.sandia. gov/news/resources/news_ releases/spiders/; accessed February 27, 2012.
24. SERDP; The DoD Study Finds 7,000 Megawatts of Solar Energy Potential on The DoD Installations in Mojave Desert; January 13, 2012; http://www.serdpestcp.org/News-and-Events/News-Announcements/ Program-News/The DoD-study-finds-7-000megawatts-of-solar-energy-potential-on-The DoDinstallations-in-Mojave-Desert; accessed February 27, 2012. 25. SERDP; January 13, 2012. 26. SERDP; January 13, 2012. 27. SERDP; January 13, 2012. 28. Mulrine; Anna; How the U.S. Military is Trying to Cut Its Enormous Energy Appetite; US News and World Report; March 16, 2009; http://www.usnews. com/news/energy/articles/2009/03/16/how-theus-military-is-trying-to-cut-its-enormous-energyappetite?page=2; accessed February 27, 2012. 29. Mulrine; March 16, 2009. 30. Nellis Airforce Base PowerTracker; http://www. thelivingmoon.com/45jack_files/03files/Nellis_AFB_ Solar_Array.html; accessed March 2, 2012. 31. U.S. Army Corps of Engineers; Fort Irwin Solar Energy Enhanced Use Lease (EUL); http://www. clarkenergygroup.com/ irwinpressconference/Fort%20 Irwin%20Solar%20Energy%20-%20Press%20Kit%20 -%20FINAL.pdf; accessed January 19, 2012 32. Randazzo, Ryan; Defense Department Seeks Energy Advantage; USA Today; February 16, 2012; http://www.usatoday.com/ USCP/PNI/Business/201202-16-PNI0216biz-energy-defensePNIBrd_ST_U.htm; accessed February 27, 2012. 33. Pellerin, Cheryl; U.S. Department of Defense; Smaller Carbone Footprint Means Fewer Risks, Officials Say; January 19, 2012; http:// www.defense. gov/news/newsarticle.aspx?id=66860; accessed February 27, 2012. 34. Robyn, Dr. Dorothy; Statement of Deputy Under Secretary of Defense for Installations and Environment before the House Armed Services Committee Subcommittee on Readiness; February 24, 2010; http://www.acq.osd.mil/ie/download/ robyn_ testimony022410.pdf; accessed February 27, 2012. 35. SERDP; January 13, 2012. 36. Trabish, Herman K.; Will the Military Be the Bridge to the US Renewable Energy Future? News Policy; Langson Energy; September, 2011; http://www. langsonenergy.com/wp-content/uploads/2011/11/ Military-Bridge-to-Renewable-Energy.pdf; accessed March 2, 2012. Reformatted by PSI.
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A San Diego company works with local roofing contractors to install an integrated solar roofing solution that is easier for homeowners to understand.
Fr a n k A n dorka/ Edi t ori al Di rect or
OneRoof Energy, a San Diego-based solar
company, wants everyone to go solar. That’s why President and CEO David Field collected all aspects of a solar installation under one roof — financing, installation and maintenance. Through its network of equipment providers and roofing experts, the company makes it easy for homeowners to start generating their own solar electricity with far fewer complicated details (see sidebar). “We get notification from OneRoof that there’s a lead on a project, and we go to work,” says Jared Hartley, solar division manager for IES Residential, the company that handles the electrical connections during installations. “We help design plans for whatever roof we’re looking at and make sure we can get the materials to the roofer that they need.” Once the materials are on site, the roofer takes over the installation process. Brett Moran, solar sales manager for CertainTeed (see sidebar for OneRoof vital statistics, including key partnerships), says the OneRoof system is easy to install and maintain. “It’s amazing how fast the solar shingles can go up with just two installers,” Moran says. “We are so sure the installation will go well, we stand behind it and the people we have installing it. It’s a great program.”
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OneRoof Energy Vital Statistics
I N S T A L L A T I O N
P R A C T I C E S
Founded: 2011 States Operating: California, Hawaii Partners: Close to 100 partners to sell its solar leasing program Partnerships Critical To Its Success: National building and solar products company CertainTeed. OneRoof makes use of CertainTeed’s sales force, training, brand strength — and its network of 600 to 700 roofers to sell its SolarSelect Lease Program. Integrated Electrical Services (IES) will provide the electrical installation component and has the ability to install projects in all 50 states. The company already has a breadth of industry experience through the installation of solar PV systems for many of the nation’s top builders, providing additional reach for the OneRoof Energy SolarSelect Lease.
How To Do It Moran says the first step to installing a solar roof is to put down a two-ply underlayment — a fire-base sheet called Empire-Base, a heavyweight, SBS modified bitumen, fiber glass sheet designed for use as a base sheet for both hot and cold applied, built-up roofing systems. “It’s an ice-and-water seal,” Moran says. “It has a Class A fire rating — the same rating you’d have on a regular roof because it is the roof. It acts as a roof and a solar system at the same time.” Then the roofer places the starter flashing around the perimeter of the roof as well as raised louvers and starter vent flashing. Then the installer is ready to put down the first
course of shingles. Moran says the installers of OneRoof systems use the Apollo Solar Roofing product, which consists 14 high-efficiency polycrystalline silicon solar cells for a power rating of 52 watts per module. “The way the Apollo locks on — on both the bottom and upper levels — the modules slide and lock into the wind clips,” Moran says. “The top is locked in by two clips. Once you have those locked down, they are covered by 100-mph wind warranty, just like a typical roof.” Then the roofer installs five left and five right side flashings, which from the ground looks just like flashing around a skylight. “It’s easy for installers to understand how
All Together Now A OneRoof Energy system comes with comprehensive coverage:
• Limited 20-year performance guarantee • Long-term maintenance and repair. • Free performance monitoring • Roof warranty
We believe this system is incredibly easy to install. Two guys can install 1 KW every two or three minutes. 4 6 SOlar power world
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I N S T A L L A T I O N
to put it down,” Moran says. “Most of them have done something similar before on other roofing installations.” Next, the installer ties in the shingles from right to left like a typewriter. The wire management is all done by wire clips. “You can’t pinch wires or get crimped wires, so you don’t have all this wiring mess,” Moran says. “You’re connecting the shingles in series putting wire clips along the top of the system.” Once an installer is done with the shingles, he has to terminate in waterproofing with left and right corner flashings. The wires, which are installed last, create the one and only penetration in the roof deck. This is a oneinch hole one inch above the last course of shingles, into which the installer puts the pipe-nipple, bushing, top, rough deck, homerun wires and ground wires. On top of that goes the top wire cover, which can run up to 17 inches in length. “You have to make sure you get plenty of coverage,” Moran says. “As water backs up the roofline, you don’t want it to damage the shingles. But these shingles have been tested at 110-mph wind-driven rain. It’s the wires and water that don’t mix well.” As you terminate to the roof edges, the roofer should install metal side flashings. “We insist that they’re installed at a minimum 12 inches along the edges of the roof,” Moran says. “We want to make sure it’s watertight.” The shingles have been prefitted to the roof dimensions and the solar shingles come to the roofer together as a kit, which includes almost the entire balance-of-systems. “We believe this system is incredibly easy to install,” Moran says. “Two guys can install 1 KW every two or three minutes.” Most roofs will hold 70 Apollo panels in two strings of 35. As CertainTeed is the manufacture of the shingles and the roofing materials, the company offers 10- to 15-year warranty for installation, which mirrors the one offered
P R A C T I C E S
by OneRoof leasing. “We wanted to copy that same sort of warranty,” Moran says. “We stand behind the people we have doing the installations. We’re proud to be working with OneRoof — and we hope to be working with them for a long time.” SPW
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UnderRoof
Va r u n R a i/ A s s is ta nt Prof es s or
the
S
ocial and communication networks are key determinants in the decision-making of individuals who make up technological systems. In the context of residential photovoltaic (PV) arrays, it would be useful for a range of market players to understand the nature of those networks and how they affect household decision-making to adopt PV. Some of the questions that would be useful to ask are: What are the main motivations for people to adopt PV technologies? How do socio-demographic factors correlate with adoption of PV? What financial metrics (such as payback period or rate of return) do PV adopters use to assess the financial merits of PVbased electricity generation? What uncertainties and barriers do potential adopters face?
• • • •
reveals how households decide to install PV.
What information sources (other PV owners, •websites, etc.) do consumers use to inform their decision to install PV? How effective are these different information channels? and, What is the consumer’s post-installation experience in comparison to pre-installation expectations from PV?
• •
Despite the clear importance of these questions, there is little rigorous data and analysis to answer them. With that vacuum in mind, we at the Energy Systems Transformation (EST) Group at the University of Texas at Austin initiated survey-based research to study the residential PV market. The data for the findings reported here were collected during August to November 2011 from 365 residential PV owners
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A new University of Texas study
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ENGINE E RING TE CHNO L O G Y DE V E L O P ME NT S
Change in Electricity Consumption Change in Awareness of Electricity Use
% of Respondents
50% 40% 30% 20% 10% 0% Much Lower
Lower
Same
Higher
Much Higher
Not Sure
Change in Awareness/Consumption After Installation in Texas. Separate full-length publications are in preparation with more detailed presentation, analysis and discussion of the research findings. As expected, the average PV adopter in Texas is more educated and has a higher income than the median Texan. For example, the median household income in 2011 of all respondents is between $85,000 and $115,000. The median household income in 2009 in Texas was $48,286. Regarding motivations, general interest in energy, belief that PV is a financially prudent investment and a desire to reduce environmental footprint were reported as equally important motivators for installing PV (responders consider energy security and energy independence as part of the “general interest in energy”). Many respondents stated that electricity cost has increased and will continue to increase, making PV a better investment with time. Our research suggests that while there is no dearth of PV-related information for potential adopters, the relevance and trustworthiness of information continues
TABLE 1: USE OF FINANCIAL METRICS
All Responders
Number
NPV
37
11.8%
IRR
113
36.0%
Payback Period
274
87.3%
None
23
7.3%
Number of Responders
314
50
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to be an issue. During the decision-making period (DMP) — the time between when a household begins to consider PV seriously and the date when they sign a contract to install a PV system — the respondents seem to have developed a good understanding of the technical as well as financial attributes of PV. In other words, the necessary information is out there. Yet responders also report spending a significant amount of time and effort sifting through all this information during their DMP—the average DMP reported was nine months (median of six months). Prospective adopters rarely complain about too little information. Instead, they face an information overload that is hard to distill into a coherent picture showing how residential PV will affect them. There is a clear need to consolidate the necessary information and tools into a central information clearinghouse run by an independent, trustworthy third-party. An effective strategy that several PV adopters employ during their DMP to access trustworthy information—apparently in low
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supply—is to contact existing PV owners, both in and outside their neighborhood. We saw that 90% of the sample agreed or strongly agreed with the statement “Talking to owners of PV systems was useful or would have been useful.� Of responders who contacted other PV owners prior to installation, 57% agreed that “my discussions with PV owners profoundly improved the quality of information.� Further, our study shows that potential adopters who had a more difficult time finding dependable information are more likely to want to talk to other PV owners. Contact with neighbors before installation was the single most effective strategy for speeding decision times. On average, those with at least one contact with an existing PV owner in the neighborhood took 4.5 months less in their DMP.
While there is need for the quality of information provided by contact with other owners among potential adopters, this need is not uniform across the spectrum. For example, the solar-leasing model makes information gathering for potential adopters redundant along several dimensions, especially regarding performance and guarantee of the PV system. That is, those who lease do not spend as much time researching any other attribute of solar but finances. This is consistent with the fact that typically performance, as well as operation and maintenance (O&M), of the equipment is covered under the lease agreements, so these aspects do not concern leasers much. On average, leasers report spending less time researching (DMP lower by two months) and report easier availability of dependable information. Consistent with all this, 87% of
leasers agree or strongly agree that talking to other PV owners is unnecessary. So what about the economics of decisionmaking in the adoption of residential solar PV, especially buy vs. lease differences? Insights on the financial aspects of residential PV as seen from the consumers’ perspective are perhaps the most intriguing. Most adopters (87%) use simple metrics like payback period to evaluate the finances of PV. Reported payback period ranged from 1.5 to 35 years with the majority reporting a range between 7 and 10 years. Few report using net present value (NPV) as a decision metric, even though rational decision-making would suggest the use of NPV. Further, about 40% of the adopters perform the financial calculations by themselves. Given the inherent complexity of reliably calculating a PV system’s lifetime finances, it is likely
Smart Weather Sensor Ž future inside ¡ Zukunft eingebaut ¡ future inside ¡ Zukunft eingebaut ¡ future inside ¡ Zukunft eingebaut ¡ future
Temperature, humidity, air pressure, wind direction, wind speed, solar radiation
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EN GINE E RING TE CHNOL O G Y DE V E L O P ME NT S
All Responders
Number
Percent
Neighbor
10
2.7%
Family
10
2.7%
Contractor
164
44.7%
Online
26
7.1%
Utility
17
4.6%
Non-profit
7
1.9%
Myself
212
57.8%
No Calculations
27
7.4%
Number of Responders
367
that majority of these estimates are not accurate. Interestingly still, a majority of the respondents report system performance “as expected or better than expected.” We compared the payback period that PV adopters report as having used to evaluate their investment decision with an objective model we have built to calculate those same metrics. Our model includes several detailed features of household-level electricity consumption, electricity rates and PV-based electricity generation, including time-of-day and monthly variations. This comparison of reported and objective metrics allows us to unpack the differences in risk perceptions between buyers and leasers of PV. Assuming the same discount (10%) for all adopters, we find that across a range of plausible scenarios buyers are more optimistic in their outlook about the costs and benefits of PV than leasers. That is, either buyers have a lower discount rate compared to leasers, or they believe more strongly that electricity prices will increase at a faster pace than in the past and that O&M costs of their PV system will be small. Further, we do not find any significant variation between buyers and leasers on any socio-demographic dimension (age, home value, income etc.). Taken together, these findings suggest that the leasing model is making PV adoption possible for households with a tight cash-flow situation, i.e., those with a higher discount rate. From this perspective, the leasing model has opened a 52
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new market segment at existing prices and supply chain conditions, and represents a significant business model innovation. What have we learned about PV-adopters’ post-installation experience? As discussed above, the decision to install a PV system is a resource-intensive process — it requires significant amount of both time and effort as well as capital. Given this relatively intense DMP as compared to most other household decisions, it might be expected that the adoption of PV would lead to a change in awareness of electricity use — when it is used, how it is used and how much is used. More than 70% of the sample reports that awareness of their electricity use (amount used, bill paid and purpose of use) is “higher or much higher” as a result of installing solar. Thus, most respondents believe that their awareness is higher postinstallation in all three areas of electricity use. A variety of factors, including the intensity of information search during the decision-period and the use of monitoring devices post-installation, appear to be in play as awareness enhancers. A significant portion (46%) of PV adopters perceives that their total electricity consumption (PV + Grid) is lower post-installation than compared to pre-installation. Significantly increased awareness of their electricity usage and an enhanced concern for the environment in the process of PV adoption appear as tentative drivers of these perceptions.
Finally, about one-third of the respondents report changing at least part of their electricity-consuming activities postinstallation to match more closely electricity production from their PV systems — loadshifting into peak demand hours. Many who reported load-shifting into peak hours report doing so to make “better use” of the electricity generated by the PV system. While we cannot confirm a causal effect here, it is tempting to speculate that the price differential between inflows and outflows drives the load-shifting into peak hours by some PV adopters. At least, that is how several PV adopters perceive the situation. In some areas surveyed, several retail electricity providers do not provide any payment for outflows to the grid or do so at a lower rate than the rate for electricity inflows from the grid. Several respondents note this and lament that the price differential deprives them of the true value of the electricity generated by their PV system. Regarding the performance, operation, maintenance and financial attractiveness of their systems, most respondents feel that their PV system is delivering “as expected” or “better than expected.” Overall, PV adopters report to be highly satisfied with their decision to install PV. SPW Rai is an assistant professor at the LBJ School of Public Affairs and in Mechanical Engineering at the University of Texas at Austin, where he directs the Energy Systems Transformation Research Group (www.ESTresearch.com).
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[PRODUCTS ]
Modules Maximize in Low Light Eclipsall Energy Corp. offers monocrystalline PV modules in both 60 and 72-cell configurations. Along with the standard high-efficiency cells (NRG Series), the company also makes a premium line of modules using Selective Emitter cells (NRG SE Series). Selective Emitter modules produce an additional 0.4 to 0.8 % by maximizing performance during low light conditions. The modules also have an anodized aluminum frame with low profile weather-edge providing easier run-off for rain, snow and debris.
Eclipsall Energy Corp. www.eclipsall.com
All-In-One Weather Station Lufft says its WS501 all-in-one weather station has an external surface sensor for monitoring solar panel temperature. The optional sensor can attach to the station and adds additional channels, which can be easily polled via the existing communication signal. The WS Family of all in one weather stations provide measurements of solar radiation, wind, rainfall, temperature, humidity and barometric pressure. The sensor is configurable to work with nearly any PLC, Datalogger or SCADA system using MODBUS-RTU, ASCII, SDI-12 or Analog.
LufftUSA Inc. www.lufft.com
5 4 SOLAR POWER WORLD
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[ PR O D U C T S ]
A Pre-Assembled PV Connector Multi-Contact’s MC4PLUS are a variation of its MC4 photovoltaic connectors. They are over-molded (no cable lugs) and come assembled in any requested lead length. Designed particularly for automated assembly, the connectors enable more efficient production. The compact connector with cables of cross-sections from 1.5 to 6mm2 is TÜV and UL recognized and intermateable with the original MC4. Thanks to an innovative integrated sealing system the MC4PLUS fulfils the protection classes IP65 and IP67.
Multi-Contact www.multi-contact.com
Single-Pole Distribution Blocks for Solar Erico offers single-pole distribution blocks available with one input or two. The blocks are UL Recognized for 1000V AC/DC and IEC certified for 1000V AC and 1500V DC. Other features include being Halogen free and having a 95% fill ratio and a design that allows visual inspection of wire and confirmation of connection.
Erico www.erico.com
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[PRODUCTS ]
Metallized Ceramic Substrate for CPV Viking Tech uses refined thin film technology to manufacture metallized ceramic substrate for heat dissipation in solar CPV packages. VikingTech applies this technology to various metal circuits and fine trace patterns on ceramic and silicon wafer surfaces. Both DBC and DPC products can be fully customized on AL2O3 and AIN substrates for high reliability performance and durability in high temperature environments.
Viking America www.vikingamerica.com
DC Connectors With Snap-Lock Molex says its IP67-sealed SolarSpec DC Connectors directly connect to solar junction boxes, field installations and PV grid wiring. An internal locking mechanism prevents accidental or unauthorized decoupling of the connector during service in the field. Also, snap-lock mating allows for easy assembly. A touch-proof safety design ensures protection from electrical current even during mating and decoupling operations.
Molex www.molex.com
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[ PR O D U C T S ]
Disconnect Switches for PV Automation Systems Interconnect, Inc. offers disconnect switches for photovoltaic applications that are direct operating and available in 40, 80 and 125 Amps. The switches also offer a pad-lockable mechanism. A shaft extension and rotating handle can be ordered separately to transform the version into a door coupling type.
Automation Systems Interconnect www.asi-ez.com
Mounting For Flat-Roof Systems The Zilla® Cobra™ is a revolutionary new flat-roof, ballasted solar mounting system from Zilla Corporation, designer and manufacturer of flashings and solar mounting solutions. The Zilla® Cobra™ is engineered to make solar power more practical and affordable by significantly reducing material, shipping and installation costs.
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[PRODUCTS ]
Two Become One Magnetek, Inc.’s 1-MW, 1000-V solar inverter is air cooled. The E-Force is suitable for grid-tied large applications, such as ground mounts. The ETL-certified inverter integrates two 500-kW inverters in one enclosure to reduce the skid footprint by as much as 30%, compared with other independent 500-kW models. E-Force units achieve peak and CEC efficiencies of 97.9% and 97% with total current harmonic distortion of less than 5%.
Magnetek www.magnetek.com
A Module With Reliable Manufacturing Bosch says it’s 30117, 245-Wp, 60-cell monocrystalline modules for commercial and residential applications have a reliable and durable design due to controlling and monitoring manufacturing. The modules also feature structured front glass, a silver anodized frame and white backsheet, and 14.91% efficiency.
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[ AD Advanced Energy .......................................BC Astronergy Solar, Inc. ................................IBC
I N D E X ]
Solar Power International (SPI) .................................48
BOKER’S, Inc. ..............................................25
SolarWorld ...................................................IFC
Carlo Gavazzi ..............................................30
Upsolar .........................................................39
CentroSolar .................................................33
Westinghouse Solar ...................................24
Citel ...............................................................11
Zilla ................................................................51
CG Power Solutions ..................................35 CS Hyde ........................................................2
February 2012 www.solarpowerworldonline.com
DPW Solar ....................................................20 Dunker Motor ..............................................10 enXco ............................................................21 Growatt North America ............................43 JMC Steel Group ........................................14 Lufft USA ......................................................51 Moxa, Inc. .....................................................12 Next Generation Energy ...........................19
INSIDE: May 2012
>> DEVELOPMENTS PAGE 6
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rldonline.com
>> MANUFACTURING PROCESSES PAGE 22
>> TECHNOLOGY DEVELOPERS PAGE 42
A Guide to Successful
CSP
INSIDE: >> DEVELOPMEN TS PAGE 6
>> PROJECT REVIEW PAGE 16
PAGE 34
>> TECHNOLOGY DEVELOPERS PAGE 42
Outback Power ...........................................27
The State of the
Siko Products, Inc.......................................19 Solar Frontier ...............................................6
Solar Inverter PAGE 22
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[CONTRACTORS C O R N E R ]
Clean Solar, San Jose, Calif.
Randy Zechman
CEO Clean Solar
Randy Zechman, CEO of Clean Solar in San Jose, Calif., refers to himself as a “serial entrepreneur.” In addition to owning Clean Solar, he also operates a publishing company focused on highlighting hotels, restaurants and attractions in Silicon Valley. He also owns CityChocolateFountains.com, which looks just as delicious as it sounds. Zechman’s philosophy is simple: Business is business, and you don’t have to be an expert in an industry to start a business. “I had two businesses, and I was looking for a third one to start,” Zechman says. “I looked at many different businesses, and solar seemed like a great opportunity.” When Zechman examined solar, he saw the major contractors weren’t run as businesses — he saw individual contractors who had to stumbled into a good industry without the know-how to sustain their growth. Before he started his business, Zechman called eight of the major players in the California industry to install a system on his home. Of those companies, four called him back, three actually showed up to do their scheduled site survey and only one of them gave him a quote without having to bug them. It was then that
Clean Solar Vital Statistics:
Zechman realized there was a huge opportunity in solar. Clean Solar’s business is 90% residential and 10% commercial. Zechman believes what set his company apart from others when it started was the residential production guarantee (meaning that the panels will produce X amount of energy for a given period), a 15-year panel warranty (five years longer than the government-mandated standard) and a 15-year roof warranty. Most companies offer these benefits today, but they didn’t five years ago. Zechman says his company also reached out to a local vocational school. After he became a NABCEP-certified instructor, Zechman helped the school launch its solar installation program. “We were worried that solar would take off and there wouldn’t be enough employees to serve the needs,” Zechman says. “Part of our goal is to help the industry get from 10 people installing solar to 1 million.” Zechman says he believes the national installers will drive interest in the market, but it’s the smaller contractors who pay attention to details who will benefit most. “There’s an interesting divide happening in the solar space,” Zechman says. “We’re pretty happy to be where we are — and we expect to continue growing.” SPW
3-year growth:................220% 2008 Sales: ....................$1 million 2011 Sales: ....................$3.2 million Employees:.....................20 Founded: .......................2007 Website: www.cleansolar.com
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