By Joe McCabe, P.E.

The insurance industry has lots of exposure to climate change. But as Warren Buffet has explained, not so much for companies that do annual policy adjustments, like Berkshire Hathaway. Their exposure is limited because the trends are baked into the premiums. But there is an opportunity for reducing insurance risk due to climate change, and it comes from the insurance industry itself. The business model is to have car insurance salespeople provide leads to virtual electric car charging services. This has perfect demographics because electric vehicle owners are very receptive to solar electricity. Who wouldn’t want a clean transportation solution with local job creation that can’t be offshored?

The concept for car insurance being linked to electric vehicles and the opportunity to sell electricity comes from the community solar business model. Community solar, or community solar gardens (CSG) is a virtual way for people to get solar electricity at their home or business for half the capital cost of putting the solar electricity at their facility. A large scale remote solar electric plant can be constructed for currently at least half the cost of a building integrated or local solar system. But that does not mean 50% savings… again, it depends on the regulatory model.  At least one utility in NY is compensating garden solar production at a lower rate than for net metering (check dsireusa.org for CSG policies nationwide).

When I proposed the first “Solar Shares” business model to the Sacramento Municipal Utility District in 2005 it was actually met with approval at the Board of Directors level. Then in 2008 United Power in northern Colorado produced their own version of customers buying remote PV modules. In 2010 Claire Levy, former legislator in the U.S. state of Colorado, authored the first approved CSG legislation in Colorado HB10-1342. Minnesota has an excellent track record of legislation supporting community solar with more states enacting such legislation each year.

Two issues with insurers selling solar come to mind.  First, there are significant hurdles due to the state specific nature of community solar regulations.  Community solar is only available in a few states, and not even statewide. In New York, for instance, the community solar farm has to be in the same load zone and on the same utility as the customer.  

Second, in some states community solar does not include RECs.  You get the financial benefits of solar but not the environmental benefits.  Communication around the program would have to be very local.

Car insurance companies, like Berkshire Hathaway’s (BRKA) Geico, know who owns the electric vehicles.  The data on who owns an EV is obtained from the car insurance salesperson and then is used to target market virtual car electricity pricing/service. Geico is unlikely sign up for this, but MidAmerican Energy, Pacificorp and BHE Renewables might be interested in customer data from Geico. These are all Berkshire Hathaway Companies that sell electricity to consumers, business and industry with BHE Renewables being the latest to embrace solar.

With CSG legislation sweeping the country, these car insurance salespeople can now help to market a vehicle-community-solar-garden electric supply contract to their customers. The concept of virtual net metering need not be limited to physical properties; it is well suited for an EV needing to be charge all around town. Blockchain technology can now track transactions for electricity produced, consumed and the financial ramifications in a secure trustworthy traceable fashion. Electricity produce at a low cost community solar garden (possibly installed on unused disturbed/compromised land) through blockchain technology transact electricity produced to electricity consumed at any EV charging station. Blockchain enables trust for the credits and debits ledger of the electrical financial transactions no matter where the electricity is consumed. Meters don’t have to be on buildings anymore.

In my opinion, car insurance salespeople are ideal to help build this scenario of community solar gardens producing electricity and electric vehicles consuming it, with secure trust worthy transactions through blockchain.  

I envision community solar garden companies to begin certifying blockchain transaction services with their own or someone else’s software as a service (SAS) products that track the energy and financial transactions. EV charging network companies like EVgo, Chargepoint, Plugshare and of course Tesla are all ripe to connect with community solar garden companies. Solar garden companies should recognized the 4x need EVs have in comparison to home electricity.   Policy is key to enabling this business model and getting society off oil and onto solar EVs for climate sake!

I Would like to thank all those who helped with this article including NREL, SMUD, Neighborhood Sun and AltEnergyStocks.com.

Joseph McCabe is an international renewable energy industry expert with 20 years in the business. He is a Solar Energy Society Fellow, a Professional Engineer, and is a recognized expert in developing new business models for the industry including Community Solar Gardens and Utility Owned Inverters. McCabe is a mechanical engineer, has a Masters Degree in Nuclear and Energy Engineering and a Masters Degree of Business Administration.

Joe is a Contributing Editor to AltEnergyStocks.com and can be reached at energy [no space] ideas at gmail dotcom.  Please contact Joe for permission to reprint.

DISCLAIMER: I have no positions with any companies mentioned in this article except Berkshire Hathaway.

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by Joeseph McCabe, P.E.

Which vendors at Intersolar 2016 in San Francisco supply the best behind the meter self generation microgrid solutions?  I’ve asked similar questions about utility owned inverters, storage, and microgrids at previous Intersolars. This year I looked into the microgrid highest value propositions for photovoltaics (PV).

What is a microgrid, and why they are coming of age now?

A microgrid is a distinct electric system consisting of distributed energy resources which can include demand management, storage and generation.  Loads are capable of operating in parallel with, or independently from, the main power grid. For this evaluation a microgrid is defined as an isolated circuit that can have a utility feed for battery charging only which provides a high value for a commercial or industrial electricity consuming facility. In this case a facility can receive energy, demand and power factor values from a self generating microgrid and use the utility to charge batteries in times when self generation may not be available. Self generation can come from many generating technologies including fossil fuels, biomass digesters, anaerobic digesters (like at breweries), wind and solar PV. Low cost solar and storage are driving new opportunities for these microgrids.

Microgrids are not new for the solar industry, which has been doing off grid and island systems since before grid interactive inverters were available in the 1990’s. If structured properly microgrids can provide clean, low cost, uninterruptible, reliable and resilient electricity.

Example behind the meter microgrid

Consider a server farm that needs to expand its capabilities with a new room of servers. The facility could pay the local utility to increase its electrical service capacity, and then pay a lifetime of additional $/kWh energy and $/kW demand fees. Or the facility could install a solar electric system with batteries and if it has natural gas, the facility can generate combined heat and power (CHP). The heat is used to air condition the servers with absorption chillers. Multi-port microgrid solutions are now being offered by multiple vendors for these purposes.

As a facilities decision maker, pick a CHP that can supply your air conditioning requirements with absorption chillers. Add a PV system that supplies the electricity for your process for most of the year. My favorite flavor PV system would be integrated with a parking structure. Also pick an electrical storage system that can safely provide the power needed for times when the sun isn’t shining and for when your CHP unit will not be in an economical operating zone. The microgrid will supply clean power and adjust for various loads turning on and off. They can even turn loads on and off for you in a scheduled energy/demand management function. Day and hour ahead weather forecasting can be integrated. A battery charging circuit tied into the local utility can put more DC electricity into the microgrid at the most economical times. In fact a microgrid can be all DC energy reducing conversion to AC losses. And of course any original utility circuitry feeds can remain as a backup to a new microgrid circuit.

Economic value

Energy economic evaluation is straightforward in today’s PV market, coming in at an onsite cost of $0.06 to 0.10 per kWh for larger experienced installer systems (my own utility has a $0.056/kWh PPA system). This would be compared to the utility bill $/kWh which vary widely but are typically above $0.06/kWh for commercial and industrial accounts. April 2016 EIA average estimates are $0.101/kWh for commercial and $0.064/kWh for industrial across the USA. Demand charges ($/kW) can be reliably eliminated from utility bills with a microgrid. CHP systems typically achieve total system efficiencies of 60 to 80 percent. Expensive power factor charges ($/kVAR) can be reduced from utility bills by addressing the facility equipment that is is causing power factor problems, and isolating that/those circuits with a microgrid solution. Whole facility can address these expenses with power factor correcting capable inverters, often a standard function on newer inverters. 

Power factor is a correction billed by the utilities for power delivered by alternating current. It varies when certain equipment causes the apparent power to differ from the true power, this difference is a measure of kVAR. Power factor can be analogized with a mug of beer. The actual beer fluid represents the power in kW, and the foam represents the wasteful kVAR, the kVA being the actual amount of work the utility needs to provide in the form of the total volume. Reducing power factor is like reducing the foam in the mug of beer. I have seen power factor representing 50% of a hospital’s electric bill.

Regulation can also change economic value. The federal Investment Tax Credit (ITC) of 30% applies to the cost of storage, if and only if the storage is charged by the PV system. If you are interested, contact me for an industry white paper regarding these values. 

Utility regulations

The regulatory environment for microgrids is just beginning to be developed. It is a perfect time to explore microgrid opportunity with low cost PV and new battery solutions which were being discussed and demonstrated at the Intersolar event. Any microgrid solutions will most likely be grandfathered in before any new regulations. The California Energy Commission and the California Public Utilities Commission (CEC & CPUC) recently held a conference call to begin a microgrid workshop process. Regulators should keep behind the meter regulations to a minimum because they provide an excellent source of electricity for facilities. In other words, regulators should keep their hands off our collective BTMs unless invited.

The brand new Rule 21 in California outlines functionality required for all new grid connected distributed generation. It is a tariff that describes the interconnection, operating and metering requirements for generation facilities to be connected to a utility’s distribution system. These same equipment standards enable a new class of products that are isolated, or strategically connected to the grid. I am choosing to look at non-exporting microgrid because it is easier from a regulatory environment. At some point I predict the utilities will be asking facilities for access to these isolated microgrids for addressing the utilities’ demand response programs. At which point it should be easier for the utility to pay for and certify the dispatching functionality.

Which companies will benefit?

Various support equipment and services are offered by vendors which are forming strategic relationships with system solution providers. Original equipment manufacturers are teaming with system suppliers along with boutique software companies to supply such systems to the electric utility industry and end commercial and industrial electric users.  A few vendors at Intersolar that seem well-placed to address the example scenario are Ensync, Greensmith, software company Geli, a multi-port microgrid company called Ideal Power (NASD: IPWR), and system integrators who take other vendor wares and integrate solutions like Gexpro (a part of Rexel (OTC:RXEEY)).

Photos below are from the 2016 Intersolar exhibits and should be self explanatory:

New company relationship agreements were announced at this year’s Intersolar event by Ideal Power and sonnen (European residential battery storage company new in the USA), as well as between Gexpro and Geli. Greensmith announced new products for pre-engineered packaged solutions under 1 MW with up to 4 hours of battery backup. Larger systems like a large 20 MW installations are still custom builds for Greensmith. Ensync is combining fast lithium-ion batteries with slower flow batteries to address both immediate intermittency and longer term demand reduction functions.

Facilities managers who want to save money on electric bills or are trying to meet environmental goals can begin an exploration into microgrids by choosing an existing or future electric service circuit for a microgrid.  To do this they need to determine the hourly, monthly and yearly load profiles on the circuit. Then start stacking the latest distributed generation options to determine if there is a viable behind the meter microgrid opportunity.

Conclusion

For the first time, this year Intersolar showed us behind the meter microgrids. In this article we have defined an economical microgrid which can be used as an example to build your own microgrid solution and have presented a few of the companies supplying solutions in this space. Low cost solar and storage solutions have enabled this new class of on-site solution. Regulations are currently minimal for facilities to install self generation equipment. These behind the meter microgrids will become increasingly important for tomorrow’s electricity industry because they have become cost effective for commercial and industrial electricity users.

No Disclosures

Joe is a Contributing Editor to Alt Energy Stocks and can be reached
at energy [no space] ideas at gmail dotcom.  Please contact Joe for permission to reprint.

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by Joseph McCabe, PE

My uber-conservative utility, Intermountain Rural Electric Association (IREA) has been against solar since before I moved into the service territory in 2007.  IREA’s long-serving general manager, Stanley Lewandowski Jr., would include climate change denial leaflets in the envelope along with the monthly electric bills.

Now he is gone, and attitudes seem to be changing towards solar. With a new general manager, a couple of forward thinking board of directors and a handful of active IREA owners/members the solar landscape has changed and now includes a large solar project.

Currently IREA has 550 MW of installed electrical generating capacity, about 270 miles of transmission lines and many more of distribution.  Residential users account for about 65% of electricity demand. Like most rural electrical utilities, there are few customers per mile. At the end of 2014 there were 354 solar electric systems, end of 2015 had 1,087 and currently there are 1,250 totaling 7.1 MW out of 152,300 total customers. IREA’s perspective has been that net metering is a subsidy paid for by other ratepayers. Unfortunately, in a mis-guided attempt to recoup this perceived subsidy, since the beginning of the year IREA has placed a load factor adjustment (LFA) on all new customers including new PV.  I expect that many people will soon be clamoring as to their unfair bottom line monthly bills compared to their neighbors.

LFA is a penalty charged for periodic high demand. The LFA discourages both customer sited PV and electric vehicle (EV) charging.  It also presents further confusion to the typical energy consumer, a tower of babble. The new, much higher LFA rate is triggered if the average demand over the billing period divided by the peak demand over the same period exceeds 10% for residential service.  If triggered a peak demand charge is added to the bill. The typical load factor for an average residential IREA customer is about 20%. But EV charging and PV generators will almost certainly send customers into lower than 10% LFA; EVs because of higher peak demand and PV because of lower average demand. One more intelligent solution would be to incentivize EV charging at night, when IREA’s electricity supply from Xcel Energy’s (XEL) Comanche III coal plant output and wind power produce the cheapest electricity.

For the 8 years I have been an IREA member/owner I have been going to the microphone at the annual membership meetings and been a pebble in the shoe of my representative to try and implement community solar gardens (CSG, also known as community solar or shared solar). In parallel, I was helping the state of Colorado pass the first ever CSG legislation (House Bill 10-1342, Levy), and before that I invented and implemented the first large scale utility owned CSG located in Sacramento starting in 2005. It almost feels like the efforts of a few people are helping to change the attitudes of our utility towards cost effective solar.

The economics of CSG are supported by the Public Utility Regulatory Policies Act (PURPA) which encourages the development of renewable energy projects by requiring utilities to purchase energy and capacity from qualifying facilities if at or below avoided costs. In 2015 juwi, headquartered in Boulder Colorado, was able to propose a solar project at IREA’s avoided costs. IREA announced the groundbreaking has begun by juwi on the 13 MW CSG named Victory Solar. This is close to Denver in Adams County. It is unique in that it is 15.9 megawatt DC but 13 MW AC, a 1.3% DC overrating which should save on the overall project economics.  This project has a long-term power purchase agreement with an IREA purchase option in a few years.  IREA upgraded an underutilized substation for the interconnection at a cost of  $1.4M. The asset utilization for this project, the out of pocket expense for IREA, is fantastically low compared to ownership of other generation. Solar is now cost effective at this scale. Currently IREA is planning a portion or all of this project to be a CSG. I am excited to be able to charge my EV with solar electric power from my utility by the end of the year.

IREA obtained special approval from Xcel Energy to generate 15 MW of solar electricity in violation of their All-Requirements contract. Smaller utilities often have such All-Requirements contracts with larger utilities or with transmission organizations like Tristate. Recently, FERC has ruled against Tristate for imposing similar all-requirements on Delta Montrose Electric Association (DMEA). This is a major national tipping point for smaller utilities like IREA and DMEA to enable more distributed generation from renewable energy.
 
The next steps for the active IREA members are to correct the LFA to encourage EV and customer sited PV and to get an additional 2 MW CSG on disturbed or contaminated land in IREA territory. Electric Muni’s, Co-operatives and Associations are perfectly suited to reap the benefits of distributed generation, create local jobs, and revitalize land for local projects. A great example of such a project is located south of Boulder adjacent to the superfund Marshal Landfill site. EPA helped envision and spearhead this Community Energy Collective (First Solar FSLR has a 27% interest in CEC) project.

This large CSG by IREA is a watershed event, where like many conservative local utilities, IREA has been waiting for solar to be cost effective for their needs. That day has come, and will be showing up at many more utilities who are more focused on their customers than on stockholders. CSG’s are also well suited for rural utilities who have fewer customers per mile, justifying distributed energy from solar as opposed to central station generation from fossil fuels.

Disclosure: Joseph McCabe is a Xcel Energy stockholder.

Joseph McCabe is an international solar industry expert with over 20 years in the business. He is a Solar Energy Society Fellow, a Professional Engineer, and is a recognized expert in developing new business models for the industry including Community Solar Gardens and Utility Owned Inverters. McCabe has a Masters Degree in Nuclear and Energy Engineering and a Masters Degree of Business Administration.

Joe is a Contributing Editor to Alt Energy Stocks and can be reached at energy [no space] ideas at gmail dotcom.  Please contact Joe for permission to reprint.

Related article: Comparing Community Solar Subscriptions And Yieldcos

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by Joe McCabe

Where is the money in microgrids? My goal at this years Intersolar event was to try and answer this question; to figure out the value proposition of microgrids as they relate to distributed generation, storage, renewable energy and photovoltaics. 

A microgrid is an electrical supply and use system that can operate autonomously. Although all microgrids are small relative to the electric grid as a whole, the huge size of the grid leaves a broad range of what can count as “micro.”  Microgrids can be as small as a single building, but range on up through schools and military bases and an entire community, such as San Diego Gas and  Electric’s Borrego Springs CA microgrid which includes Spirae equipment.  Even my plug-in-prius with an an AC inverter can be considered a microgrid.

Islands have microgrids already, with Hawaii leading the experience curve on what an electrical grid looks like with increasing levels of intermittent renewable energy power sources. On the US mainland, research and development projects have funded microgrids using words like resilience and reliability as justification for the work. But it is hard to find the monetization of these concepts which is needed to justify any return on an investment for microgrid functionality.

At this past week’s Intersolar NA 2015 held in San Francisco, microgrid companies were exhibited more frequently than in past years (see my previous articles from Intersolar NA events on racking, storage and what not). Jerry Brown’s most recent inaugural address included the word “microgrid”.  Microgrids provide an added value for uninterruptible power. Unreliable grids are typically found in developing nations, so the US with today’s relatively reliable grid doesn’t typically have a realistic value proposition. The term resilience is being used more often as it relates to the grid with increasing levels of intermittent renewable energy. The cyber security of the grid is and will continue to be increasingly scrutinized. Hurricane Sandy prompted New Jersey to develop the Energy Resilience Bank with funding for systems sized to provide energy to critical loads during a seven-day grid outage.

Use-cases driving the discussions around microgrids are used by the California Smart Inverter Working Group to develop rules around the advanced functionality of inverters with and without electrical storage. A growing group of electrical utility and solar industry professional meet weekly to discuss the new California Rule 21 language, the communications/security/rules/scheduling of valuable advanced functionality.  All inverters sold into California will be required to have this advanced functionality starting at the end of 2016.

Greensmith is a company that exhibited again at this years Intersolar discussing their ability to work with all manufacturers of storage and inverter equipment.

Other companies whose products and services that relate to microgrids at Intersolar included Princeton Power Systems (developers of the Alcatraz Island microgrid),

Dynapower developers of the Green Mountain Rutland City, VT microgrid which includes a PV system on a brownfield landfill privately owned by Frankston Holdings.

Ideal Power has an interesting 125 kW inverter that will take PV, charge and discharge storage and integrate with a generator to provide AC power on a microgrid.

Solar Energy International held a workshop which included microgrid content. In future years you will probably see a focus on microgrids at Intersolar as you saw with the evolution of storage that this year dominated one floor of the Moscone Center’s West hall exhibit space.

Duke, American Electric Power, Berkshire Hathaway Energy, Edison International, Eversource Energy, Exelon, Great Plains Energy and Southern Co. have grouped together on microgrid issues under the umbrella of Grid Assurance.

One of the biggest announcements for this space was the July 1st submission of Southern California Edison’s Energy’s Distributed Energy Plan to the California Public Utilities Commission. Edison indicated they will be opening up their ~20,000 distribution lines to third party vendors of electrical services because Edison’s business is being a wires company. In my view, this opens up the opportunity to genuinely value microgrids at each of the connection points for residential, commercial and industrial customers on the distribution lines. I wasn’t able to answer the question of the value for microgrids within large scale grids in $’s/resilience or $’s/reliability. Perhaps in the not too distant future each utility customer will be charged accurately for the safety, security, resilience, and reliability of its electricity with the help of Edison’s new awareness around their Distributed Energy Plan.

Conclusion

Microgrids will become increasingly important to the storage, solar and wind power industries because they will add security, resilience and reliability values.  Off grid and island systems continue to be successfully implemented.

Rule 21 equipment being required at the end of 2016 and PJM’s frequency markets are enablers for the monetization of microgrids values, possibly by as early as 2017. When you see these values monetized as is currently done with energy ($/kWh), power ($/kW), frequency regulation (PJM) and power factor correction ($/kVAR) are monetized, then microgrids will become widespread.

Joseph McCabe is an international solar industry expert with over 20 years in the business. He is a Solar Energy Society Fellow, a Professional Engineer, and is a recognized expert in developing new business models for the industry including Community Solar Gardens and Utility Owned Inverters. McCabe has a Masters Degree in Nuclear and Energy Engineering and a Masters Degree of Business Administration.

Joe is a Contributing Editor to Alt Energy Stocks and can be reached at energy [no space] ideas at gmail dotcom.  Please contact Joe for permission to reprint.

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Thanks to Ravi Manghani of GTM Research, Steven Strong of Solar Design Associates and Solar Energy International  for help with content on this article.

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by Joseph McCabe, PE

Walking into the 2014 Intersolar North America San Francisco exhibit it became apparent there was a story embedded in the products and services displayed on the three different floors of the Moscone Center West. The third floor of the exhibits was dominated by PV structure companies which have entered into a competitive blood bath since our last report. Dominating the first floor were Chinese PV manufacturers Jinko Solar (NYSE: JKS), Canadian Solar (NYSE: CSIQ), Trina Solar (NYSE: TSL) and Yingli (NYSE: YGE) all sharing the center exhibit space. Although Chinese solar is a popular topic due to newly imposed import duties, and the PV racking industry is highly competitive, the dominant story of this year’s event was storage which dominated both the conference and the second floor 2014 Intersolar NA exhibits. On-going storage side-sessions were held adjacent to the storage focused exhibits.

Storage Role in the PV Industry

Storage has become such a hot topic because consumer, commercial, industrial and utility PV installations can now benefit from electrical storage. Storage is important for maintaining consistent electrical output from PV due to clouds; enables PV systems to store energy in the morning for dispatching during later hours of the day when the sun has gone down, when the electricity is more valuable; and allows for other high value grid related support functions.

Storage is becoming more prevalent in today’s PV industry for at least two reasons: 1. Because of lower PV installation costs, there are more and more PV installations. Higher amounts of PV, and a higher percentage of PV on the grid requires storage to smooth out drops in PV power output due to clouds, called intermittency (especially important in isolated grids with lots of PV such as in Hawaii).   2. Lower electrical storage costs from batteries, driven by the electric automotive industry, are enabling lower costs and more functionality for PV combined with electrical storage. These factors combined with the now available advanced functionality from PV inverters are opening up new markets for storage. New policies, new electrical tariffs (the way utilities charge customers) and new storage use cases are creating profits for both the PV industry and the utilities. There are many different types of electrical storage which are used for different reasons, some of which are discussed in a previous article. The different kinds of storage will play out in the industry for their particular functionality, cost advantages and reliability.

Electrical storage requires integration with inverters; in a PV system an inverter with storage produces a more complete, reliable energy solution. Big industrial electronics players like ABB (NYSE: ABB, formerly Power-One inverters), EATON (NYSE: ETN), TMEIC, Bonfiglioli, Advanced Energy (NASDAQ: AEIS) and Solectria Renewables were exhibiting larger and larger inverter solutions including ones integrated with storage.

There were inverter company exhibits from Outback Power, SolarEdge, Chint Power and Magnum Energy. Kaco, Fronius and SMA (XETRA: S92.DE) have announced US consumer grid tied inverters integrated with electrical storage, similar to those currently offered in Europe. Those companies did not have exhibits but SMA did have a van parked outside displaying their smaller technologies.

Storage companies like Bosch Energy Storage, JuiceBox Energy, Ideal Power (NASDAQ: IPWR), Princeton Power Systems, Energy Toolbase, Sonnenbatterie GmbH, Hoppecke, Rolls Battery of New England, S&C Electric Company, VARTA Storage, American Vanadium (CVE: AVC.V) and Stem filled up a major portion of the second floor exhibit space.

Aquion Energy 7 kW, 22 kWh (at 20 hours and 30 degrees C) pallet of storage weighs 3,175 lbs and has a more than 3,000 cycle life. This particular technology doesn’t have chemical fire safety issues inherent with other technologies.

Vanadium redox batteries were discussed in sessions and displayed at this years exhibit. Vanadium redox is an interesting storage technology because in addition to the fast response time for dispatching electricity, it has an end of life value; vanadium is used for strengthening steel for rebar and other stronger, lighter materials when converted to ferrovanadium for use as a steel additive.

Many policies are driving storage including California’s AB514, Self Generation Incentive Program, and Electric Program Investment Charge, ConEd’s Demand Management, NYSERDA PV Incentive and Reforming the Energy Vision, Massachusetts Community Resiliency Technical Assistance, New Jersey Storage Incentive, and Rule 21. If storage is positioned correctly with PV it can obtain the federal investment tax credit (ITC). Storage projects are beginning to be implemented with request for offers (RFO) and request for proposals (RFP) for storage at Hawaiian Electric Company (HECO), Southern California Public Power Authority (SCPPA), Southern California Edison (SCE) and Long Island Power Authority (LIPA).

Valuing Storage, Rule 21

What wasn’t being discussed very much at the 2014 Intersolar meeting and relates directly to storage was Rule 21.  Rule 21 is the new utility tariff in California which will be driving the values from/for these electronics and storage solutions. July 18th 2014 is the current deadline for submission of new Rule 21 tariffs by the California Investor O
wned Utilities (IOUs) to the California Public Utilities Commission (CPUC). New functions including storage will be implemented, and paid for by these new tariffs.

The proposed first seven functions to be implemented by Rule 21 are Anti-Islanding Protection, Low and High Voltage Ride-Through, Low and High Frequency Ride-Through, Dynamic Volt-Var Operation, Ramp Rates, Fixed Power Factor and Soft Start Reconnection. Some of these functions enable greater PV on the grid, while others provide higher values from PV systems to the grid. Benefits to the utility from, for example, distributed power factor correction (reactive power correction) include but are not limited to increasing available grid capacities, reducing grid losses, and decreasing grid congestion.  These functions help to set the stage for greater amounts of storage + PV on the grid. For example, Anti-Islanding Protection is needed if there are many storage units connected to PV systems. The communications for all these smart grid and advanced functions are being developed by industry players like SunSpec Alliance; communications are the second phase of Rule 21. Storage plays a dominant role in the third phase where scheduling of energy services will become implemented. All these phases will play out in California in the next few years.

Turn-key Storage Solutions

I particularly impressed by a company named Greensmith. They are currently a privately held company with a reported $14M private investment and offices in Maryland and California. The history of this company dates back to 2008 with software development. Finding it easier to do the front and back end hardware themselves they became a turnkey solution for grid support and energy storage. They have a chemistry-neutral battery management system which makes them relevant to the whole storage landscape. The functions being provided by Greensmith are finding utility markets with New Jersey’s PJM frequency response, New York’s energy arbitrage (example: pumped storage resources can arbitrage price by purchasing lower priced off-peak power and selling power during peak hours of the day along with demand management due to Indian Point shut down) and the previous mentioned California Rule 21 tariff. These functions also include ramp rate control, smoothing, peak shaving and capacity shifting. CEO John Jung provided a presentation to the sessions held at the Intercontinental. They have 30 systems installed at 9 utilities with experience in 8 batteries and 6 inverter technologies. The largest of which is a 20 MW turn-key system. Systems include a 500 kW / 1.5 MWh storage system in San Diego and EV Charge + PV in Brooklyn, NY and Honolulu, HI.

Conclusion

PV combined with storage is becoming more important in the PV industry because of lower costs and greater monetizable values for increased electrical services. Energy, demand, power factor and frequency response are just some of the utility values driving the increased attention for storage when combined with PV.  Turn-key system solutions that address specific use cases for storage will be driving the near-term markets for grid connected storage in the PV industry.

Disclosure: No positions. Photos were taken before exhibits opened.

Joseph McCabe is an international solar industry expert with over 20 years in the business. He is a Solar Energy Society Fellow, a Professional Engineer, and is a recognized expert in developing new business models for the industry including Community Solar Gardens and Utility Owned Inverters. McCabe has a Masters Degree in Nuclear and Energy Engineering and a Masters Degree of Business Administration.

Joe is a Contributing Editor to Alt Energy Stocks and can be reached at energy [no space] ideas at gmail dotcom

This article was first published on AltEnergyStocks.com.  Joe will attempt to answer any comments left on the original article [link].

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Joseph McCabe, PE

In 2011, I wrote about the CdTe Horse Race in which the three US companies making cadmium telluride (CdTe) photovoltaic (PV) modules, First Solar (FSLR), Abound Solar and General Electric (GE Solar, stock ticker GE) jostled for position.  Abound and GE were challenging the reigning champion First Solar to build the largest PV manufacturing facility in the world.

The official results of that race are in, and First Solar has beaten the competition by many lengths. Within about a year of each other both Abound and GE Solar announced they had stopped any hopes of solar panel manufacturing. On July 2 2012 Abound Solar announced they were closing (See The End of Abound Solar, What Have We Learned?).  On the August 6th, 2013 First Solar earnings call they announced the purchase of all the GE Solar intellectual property, along with a relationship to purchase GE inverters thus ending the Primestar/GE Solar story in manufacturing their own product. Our trifecta ticket wasn’t in the money because we had the win right with First Solar, but reversed the second place and third show order. GE Solar came in second place because they obtained 1.75 million shares of First Solar stock. On the day of the announcement FSLR was trading around $47 or $82.25 million for GE to exit (today’s FSLR stock quote, you do the math on what it means to GE).

Those who invested in Abound ended up with nothing, in fact the Department of Energy (DOE) is financially liable for Abound PV modules that are not fit for sale and reportably have poured concrete onto them at a cost of $2.2 M http://www.denverpost.com/business/ci_22666212 and http://tinyurl.com/mleh3z9. The story will not end there, concrete encapsulated cadmium isn’t environmental stewardship. Anyone owning Abound Solar modules is now responsible for both warranty and end-of-life disposal/recycling costs.

First Solar’s February 2013 earnings call described their $1.39/watt system installed costs, which is a low cost milestone for the PV industry. GE Solar must have realized they cannot compete with this experience and pricing; in a way GE got off their own horse and got on First Solar’s during the race for dominance. GE is now one of the top ten shareholders of First Solar.

April Analyst Day

At the time of that February earnings call, First Solar wasn’t answering analysts’ questions, deferring to a April analyst day for answers. My perspective at that time was negative, having seen delay tactics resulting in bankruptcy, but my concerns were wrong. The analyst day was well received and the stock shot up from where it was around $26 at the end of February to over $39 after the analyst meeting.  First Solar announced the purchase of high efficiency crystalline silicon PV company Tetrasun at that analyst meeting, now blurring the lines between it and the other high efficiency crystalline silicon module manufacturer SunPower (SPWR).   First Solar also predicted its module cost would fall to $0.40/watt by 2017. Cost of production would be between $0.34/watt and $0.37/watt , plus $0.04/watt cost of sales. $0.04/watt is also what they eliminated with their end-of-life recycling program, now that responsibility is on the system owner.

No Environmental Stewardship

First Solar’s eliminating the prefunding for end-of-life recycling did not get much attention after the February earnings call, but it should have.  Recycling and environmental stewardship was once a cultural touchstone for First Solar during Bruce Sohn’s tenure as President, from 2007 to 2011. Asbestos manufacturing can be used as a guidepost for First Solar in that owning the recycling might be the best long term approach to reduced liability from manufacturing.

From the transcript of the February 2013 earnings call:

Note, regarding our module end-of-life program, beginning in the fourth quarter of 2012, we made prospective changes to our solar module collection and recycling program outside of the EU. For new contracted sales, customers as part of their overall power plant decommissioning obligation will now be responsible for ensuring modules that are either recycled or responsibly disposed at the end of their life.

As noted with the Abound experience,  the decommissioning and recycling costs will likely far exceed what First Solar was previously prefunding.  CdTe can be an expensive material to throw away.  It cost the DOE at the very least $0.20/watt to encapsulate the modules in concrete (as many as 140,000 modules and $2.2M cost). The right and not very difficult approach is for these thin film PV materials to be recycled and reused to produce new higher efficiency modules; a cradle to cradle philosophy (See Clean & Green). Maybe General Electric can do the right thing with their unused modules now that GE Solar is finished.

Photo 1: Crates full of broken unusable Abound Solar modules during their October 2012 auction. Photo by author.

End-of-Life Costs for PV

An example of the cost for decommissioning PV systems was recently revealed by a public bid at the Sacramento Municipal Utility District in Sacramento California (SMUD). Financial experts should take note that the 1.6 MW of retiring PV systems cost $1M to decommission or $0.61/watt. Albeit this included all ground work and removal of materials to make the land like nature intended. This kind of activity and bid is something that hasn’t been seen previously for the PV industry because systems are just now coming into retirement. PV is much less expensive than a nuclear power plant to decommission which SMUD also has experience in decommissioning. Interestingly the decommissioned Rancho Seco nuclear power plant is the exact same place the decommissioned PV systems were located.

There is currently very little knowledge base or experience in the salvage, decommissioning and recycling of PV systems. The SMUD cost experience can become less expensive if the industry can develop mechanism for decommissioning and recycling for both crystalline silicon and thin film PV technologies. We have several data points: First Solar will no longer prefund $0.04/watt; SMUD spent $0.61/watt for full site rehabilitation including recycling, and DOE’s reported disposal of Abound Solar
modules with concrete cost at least $0.20/watt.

The lesson from these experiences is to be conscious of cost reductions from module and system installers that have now become the responsibility of governments and the system/landowners.

Conclusion

First Solar continues to be a dominant player in the PV industry, winning the thin film solar factory race against Abound Solar and GE Solar, and it has now teamed with the latter on intellectual property and inverter sales. First Solar dominates the industry with low costs for installed systems, and now joins the race for dominance in the crystalline silicon space with the purchase of Tetrasun.

Environmental stewardship will need to be addressed, if not by the manufacturer then by the communities installing these systems. There is a new race, the race to avoid paying for end-of-life costs. The loser of that race is becoming clear: the public, because we don’t even know we’re in the race. If only the race were for dominance in environmental responsibility.

Disclosure: No positions.

Joe is a Contributing Editor to Alt Energy Stocks and can be reached at energy [no space] ideas at gmail dotcom.

The post First Solar Won the Race; The Environment Lost appeared first on Alternative Energy Stocks.

By Joseph McCabe, PE

Timeline for Abound Solar

The sad news on July 2nd 2012 was that 125 employees were being laid off at the Abound Solar factories in Colorado. Abound listed assets at $100 million and liabilities of $500 million in the bankruptcy filing. The final auction of the equipment assets was performed this past week.

I feel fortunate to have visited Dr. W.S. Sampath’s Cadmium Telluride (CdTe) photovoltaic (PV) manufacturing laboratory at Colorado State University in February 2005.  At that time the laboratory was depositing CdTe PV materials onto 16” X 16” glass panels. That soon became AVA Solar Incorporated in Fort Collins, January 2007;  they announced their first round of funding on February 8, 2007. AVA then became Abound Solar in March 2009, and announced they were building a new factory in Indiana in July of 2010. Between September 2009 to January 2012 Abound’s modules increased in performance from 50 watts to 80 watts on their standard 2’ x 4’ panels. (Video: Hallway of framed accomplishments at Abound). This was an exciting technology, at an exciting time when huge amounts of investments were being made in PV manufacturing technologies.

The People

Keith Nichols, Director of Facilities Engineering at Abound exemplified the mentality of Abound’s early days when he told me, “We were going to change the world”.  Veterans from all over the PV industry are intimately familiar with the feeling.

Some of the former Abound Solar people were at the auction, purchasing testing equipment and reinventing themselves as new northern Colorado companies marketing PV reliability services. A small number of other former employees with intimate knowledge of the sold equipment will be hired by the companies who purchased the salvaged gear for pennies on the dollar. Colorado may become known as one of the best knowledge bases for PV system performance services in part because of the experience developed at Abound Solar.

The Gear and Auction

With the Abound facility open for inspection, it was interesting to see one blackboard showing the day to day plans for the manufacturing floor. The chance to implement these were never realized.

Abound Solar factory plans that were never implemented.

In hindsight, perhaps Abound should have teamed with a glass factory.  This would have helped the process and reduced glass breakage. The complicated CdTe line was not a turnkey system, it was pieced together from various company machines and glass handling automation. And it was in-line so any bottlenecks would slow or shut down a production line. This inevitably creates integration challenges as processes were improved, and requires extensions in time to solve unforeseen issues. Time was not an option in today’s PV industry with rapidly dropping module prices.

A video of the various equipment pieced together for the full thin film manufacturing shows ATS Automation (TSX:ATA), Cardinal (S-Corp), Von Ardenne, and other glass handling equipment making up the very long manufacturing process.  A closer video look at Abound second CdTe line shows previously unavailable information, due to confidentiality, but now is a publicly available understanding of the Abound CdTe tools and  process.

The companies who lost financially due to this bankruptcy are those that teamed with Abound including ATS, Cardinal, Von Ardenne, companies making racking, inverters and installation companies betting on Abound’s future sales. Anyone owning an Abound PV system are now owning the warranty risk, as well as any recycling of the CdTe promised by Abound for the end of the system life. The CdTe technology requires proper collection and recycling through programs like those offered by PV Recycling.

Cardinal was at the auction, trying to buy back their own materials, for which a Cardinal representative said they had not yet been paid. 8,000 pieces of Cardinal tempered glass was sold on the web for $2,500.

One example of the discounts available at this auction was a piece of Von Ardenne sputter equipment that originally cost $5M and sold at the auction for $300k. Representatives from Singapore bought what appeared to be one complete CdTe PV manufacturing line from the auction. The results from the auction should become publicly available at which time they will be posted in the comments section of this article at altenergystocks.com.

Where was General Electric (NYSE:GE)?

Back in April 2011, I wrote an article titled “The Cadmium Telluride Solar Factory Race” describing the horse race of thin film CdTe companies competing in the PV space. At that time, it was First Solar (NASD:FSLR)  to win, Abound to place and General Electric to show (first, second and third place in horse racing terms). Abound and GE Solar were basically a photo finish for last place. On July 3rd of this year I helped break the news that GE Solar was laying off employees in Colorado.

GE seemed missing from the public Abound auction. Why didn’t they buy-out Abound at bankruptcy?  The gear would be very similar as what GE Solar/Primestar uses, and the intellectual property would be available to GE Solar. Instead the Abound equipment was sold piece by piece at auction this past week. To me this says “GE is not serious about manufacturing CdTe” or they would have been at the table purchasing specific process or support equipment. It is possible that they were hidden on the web during the auction, but they were not evident at the onsite auction. Perhaps GE doesn’t think that Abound’s intellectual property or manufacturing equipment was good enough to produce profitable CdTe PV in the current price environment.  

Lessons Learned

Investors can learn from this Abound Solar experience.  When analyzing future investments be looking for signs that people are being too optimistic about the company, the technology, the competition, and the market opportunities. Many US PV module manufacturer bankruptcies are claiming low international prices as major reasons for their downfall. PV module prices have historically reduced in prices based on the well known logarithmic experience curve (see SunShot Grand Challenge: The SunShot Swerve by Ed Gunther; a September 2012 Bloomberg version is also available). In the past two years, PV module prices have reduced in price per watt more than expected; possibly because the increased experience was more than expected. “We were going to change the world” became “The solar industry has changed the world even faster than most solar companies could handle.” The bankruptcies of Abound Solar, Evergreen Solar, United Solar, Solyndra and others are part of this world-wide-learning-curve that will continue to reduce PV modules prices.

The book “Thinking, Fast and Slow ” by the Nobel Prize winning economist Daniel Kahneman describes how emotionally-charged-investment-decision-making is fraught with challenges.  “We were going to change the world” was in hindsight too passionate. In only a few years, solar has changed the energy industry with low cost PV panels now replacing conventional sources of energy. Using experience curves, the lower priced PV modules were predictable, but not to the extend the current module prices of $0.60-$0.70 per watt discussed at the recent Solar Power International conference held in Orlando. The good news is that at these prices, there will be more and more opportunities for low cost PV system installations, more experience in the PV technology, with the positive feedback loop continuing to reduce system prices. The market becomes bigger and bigger with every drop in module and system level pricing. We are changing the world, and Abound Solar has been a part of that change.

Front of Abound Solar October, 2012 (click image for link to empty parking lot video).

This Abound Solar experience has helped the PV industry by investigating new technologies with specific advantageous over conventional technologies. The lesson of Abound is not that it’s impossible to change the world.  Changing the world is possible… but the new world is not always what we expected.

Disclosure: No positions.
Photos and Videos by author.

Joseph McCabe is a solar industry expert with over 20 years in the business. He is an American Solar Energy Society Fellow, a Professional Engineer, and is internationally recognized as an expert in thin film PV, BIPV and new business models for the solar industry. McCabe has a Masters Degree in Nuclear and Energy Engineering and a Masters Degree of Business Administration.

Joe is a Contributing Editor to Alt Energy Stocks and can be reached at energy [no space] ideas at gmail dotcom.

The post The End of Abound Solar – What Have We Learned? appeared first on Alternative Energy Stocks.

by Joseph McCabe, PE

I’ve been attending the Intersolar conference in San Francisco for ten years since it was just Semicon, and noticed many of the most interesting trends don’t show up in the headlines.   This year, I noticed that the exhibit halls were packed with metal (racking) peddlers, far more than in previous years.

Solar headlines concentrate on the modules, even though there seems to be less and less differentiation in the module market, with everyone competing for a lower and lower average selling price (ASP). As a friend and PV industry expert told me, “Everyone is trying to position themselves with a better product comparing how their $0.78 per watt is better than the competitions $0.81 a watt”. This is a sign of the true commoditization of modules.

Module commoditization leaves companies looking elsewhere to differentiate themselves; this year many companies are bringing new racking. systems to the solar market  There is still room to play, and to be better at marketing structural solutions. Lighter weights, higher wind loading, lower maintenance, and easier installations are just a few of the ways metal peddlers are positioning themselves. Lower balance of systems costs (BOS) are being targeted by the Department of Energy (DOE) as worthy of research and development funding within their Sunshot initiative. Low cost structures should be something that can remain made-in-the-US and not outsourced to overseas manufacturing.

The PV industry has become industrialized, with much more racking and mounting hardware than in the past. You can see who is staking a structural BOS claim in the industry.  Racking, trackers, roof attachments, stand offs and more vendors selling systems that look like PowerGuard. PowerGuard was a product from PowerLight, now the T5 by SunPower (SPWR), that targets flat commercial roofs with a self ballasted aerodynamic structure. The patents for PowerGuard must have expired, or the lawsuit between SunPower and SunLink must have revealed weaknesses in the original PowerLight IP such that others felt it time to get into this market. SunPower is a vertically integrated company that will not be drastically affected by this new competition in the market for commercial roof structural solutions. Is this the begining of healthy profits, then a fierce competition cycle similar to which PV module manufacturers have been experiencing?

SnapNrack is a PowerGuard like product being displayed at Intersolar for the first time. Watch not only for SnapNrack’s innovations, but also their market share; these guys are the AEE wholesale distribution people who know the ins and outs of the PV industry. SnapNrack sells through Lowes, and a host of other electrical companies. Imagine the sales force from the electrical industry now able to sell SnapNrack structures. That is a nice bump in profit to the electrician trade for the same job. Similar new products at Intersolar were KB Racking’s Aerorack, and Panel Claw.

Many other PV structural attachment companies were at at Intersolar. Quickmount, now at over 60 employees, sells an excellent stand-off for sloped roofs. S5 sells brackets for holding PV on standing seam roofing. A number of major PV module manufacturers have licensed the Zep Solar products. Unirac, Unistrut, Renusol  and S:Flex sell metal systems designed for the PV industry. Dozens of other companies are selling some kind of module attachment, ground screws or tracking system. These structural only companies may have difficulties competing in the mature vertically integrated PV industry, or competing with the well established distributors who have extensive industry experience.

While not metal, Solopower was showing off their flat commercial roof system called Solosaddle. There were many other rotationally molded plastic PV structure products at the show which had better assure UV protection; solar installations can be brutal on materials.

Norse Hydro (NHY.OL) had a large booth, but wasn’t showing specific products. They sell aluminum, and a lot of it. Having already established themselves with concentrating solar power companies, they were at Intersolar getting attention of the project and module manufacturers needing extruded aluminum. Even the Aluminum Extruders Council had a booth at Intersolar.

My first day in San Francisco I ran into California Governor Jerry Brown who said that California is aiming for 50 percent grid tied renewables, particularly solar. This is typical political speak, but sets up the tone for the expanding interest in these PV technologies. As an example from the California utilities, the Sacramento Municipal Utility District (SMUD) reportedly is expecting to install between 500 and 800 MW of new PV in the next five years. This on top of their existing 80 MW. With this kind of market pull, many innovations will be reducing the cost to install PV, including the ones mentioned here.

Disclosure: No positions.

Photos by author.

Joseph McCabe is a solar industry expert with over 20 years in the business. He is an American Solar Energy Society Fellow, a Professional Engineer, and is internationally recognized as an expert in thin film PV, BIPV and Photovoltaic/Thermal solar industry activities. McCabe has a Masters Degree in Nuclear and Energy Engineering.

Joe is a Contributing Editor to Alt Energy Stocks and can be reached at energy [no space] ideas at gmail dotcom.

The post A New Competitive Landscape for Solar PV Racking appeared first on Alternative Energy Stocks.

by Joseph McCabe, PE

More and more solar electric installations are using AC micro inverters and DC to DC optimizer electrical balance of systems (BOS) components. This BOS gear goes directly on the back sides of PV modules providing higher valued electricity than output from the PV cells alone.

Two years ago I considered micro inverters as only necessary for lazy designs or bad installation practices.  I’ve changed my attitude towards these approaches after organizing two years of forums as the American Solar Energy Society (ASES) Solar Electric Division Chairperson. These forums brought together experts who compared and contrasted AC micro inverters and DC to DC optimizer BOS equipment.

PV panels previously could not be installed in partially shaded locations because shade over a small area of the panel would drastically reduce the power production of the entire PV system. Now, shaded systems can benefit from AC micro inverters because each PV module can operate independently, instead of at an aggregated system level. Miss-matched PV modules were previously binned before installations so that each string had similar performing modules. Now the new electrical BOS gear eliminates problems with under, or over performing modules.  More recently, I have learned about the cost reduction and performance enhancing promises of these distributed technologies.

These electrical BOS approaches have evolved substantially in the last few years, and have come a long way since the first failed introduction of micro AC inverters in the late 90’s.

Micro-BOS Approaches

Micro electrical BOS components promise easier designs, lower installed costs, along with improving annual performance. Module level electrical BOS solutions for PV have many different flavors. All strategies promise to reduce the impact of individually miss-matched PV module performance over time, possibly reducing wiring and installation labor costs. Some products have communication strategies which help owners understand real-time performance and maintenance opportunities. Depending upon the project specifics, the levelized cost of energy could be reduced 20% or more.

AC micro inverters attempt to optimize efficiency by converting the DC voltage from PV modules into AC voltage that match the electrical grid’s specifications. This enables AC wires to be used, along with widely available AC electricians. Some DC to DC optimizers strategies boost the DC voltage to an optimal level. Others boost and / or buck (reduce) to maintain a specific DC voltage. There are parallel connections that add amperage, and series connections that add voltages. DC to DC optimizers raise the system voltage, lowering the wiring costs, but still need a box to invert the higher DC voltage to AC. Standard AC inverters are being optimized to work with DC to DC equipment.

Project specifics will determine which micro approach, if any, would be most appropriate. The trends are for residential systems to have AC micro inverters, and large systems to have DC to DC optimization.

The Shoot-Off Forums

At last year’s ASES Shoot-Off Forum, we had AC micro inverter companies in the same room with DC to DC optimizers comparing and contrasting their gear. This year we separated the forums into one AC micro inverter and one DC to DC optimizer group. Next year we will likely further divide the forums into companies that are shipping and companies that hope to ship.

This year’s forum included a presentation from the leading company shipping these types of solutions, Enphase Energy. Founded in 2006, they have shipped over 750,000 AC Micro Inverter units, with 25,000 installations in North America in the last 30 months. They have a 13% market share for US residential installations below 10 kW.  According to Enphase, micro inverters will be 11% of all world wide inverters by 2014, which means we need to keep a close eye on these market trends reshaping the PV industry.

For the first time in public, Ampt LLC presented their large-scale PV systems approach with their DC to DC optimizer technology. Ampt’s roots are intertwined with Advanced Energy Industries Inc. (stock symbol AEIS), which makes thin film deposition power conversion and thermal instrumentation equipment as well as PV power inverters. On May 3, 2010, Advanced Energy (AE) acquired all of the outstanding common stock of PV Powered providing AE with a full line of DC to AC Power Inverters. The Co-founder and Chairman of AE is Douglas S. Schatz. He is listed as an inventor on Ampt patents and is Chairman of Abound Solar (previously AVA Solar). A nice central station thin film PV solution is evolving from this AE / Abound Solar and Ampt relationship. In my option, thin films can benefit from these micro technologies because of the soft shape of the power curves and immaturity of thin film technologies in comparison to crystalline PV.

At the forum, SolarBridge Technologies announced volume production of their AC micro inverter including strategic partnerships with PV module manufactures. They are offering a 25-year warranty through their PV module panel integrators. This makes for a central warranty location, as long as the PV module companies stay in business. Matching module warranty with the micro gear is a very good marketing strategy. Very long mean time between failure (MTBF) numbers were presented by various companies, in the 400 to 500 year ranges. The high operating temperatures of this gear exposed to the heat of the sun make these MTBF’s highly questionable. The PV industry will surely become more savvy in estimating and marketing MTBF in the future.  

Other unique strategies were presented at the forum. eIQ Energy presented their parallel DC to DC optimizer including an integrated wiring harness solution made by Shoals Technologies Group. Tigo Energy explained how their DC to DC optimizer solution uses a combination of real-time module and string-level information to compute the optimal operating state of each PV module. There are many more micro approaches and business models being promoted in today’s micro electrical BOS space.

Future Competition

Be on the look out for two international leaders in traditional PV AC inverters to introduce micro inverters; Power-One (stock symbol PWER) and SMA Solar Technology AG (stock symbol SMTGF.PK/S92.DE).  In September 2009, SMA purchased OK4U, one of the original micro AC inverter technologies. Kaco New Energy Inc’s transformer-less inverter was shown as a partner for the DC to DC strategies in the forum, and like other existing inverter companies, will have good opportunities to customize their grid interactive technologies with micro technologies.

Beware, these micro technologies are highly duplicate-able. This means they will probably be championed by very intelligent electrical engineers from developing nations. I heard a rumour from this year’s Solarexpo conference in Verona that there was an Enphase knock-off from China, everything the same, except the very important aspect of quality.

Copycat designs will be enabled by National Semiconductor’s May 2011 announcement of the availabilit
y of their integrated circuits (IC’s) for use in the design of PV system micro inverters, power optimizers, and charge controllers.  National Semiconductor ended its original June of 2008 SolarMagic business of selling complete micro components and calling it a “per-panel electronics solution that maximizes power output of multi-panel installations”. Now, they are backing up the supply chain to supply IC’s  instead of BOS components. Texas Instruments has been marketing PV power IC’s for a few years.  

The largest inverter companies, and the smallest companies enabled with computer chips from National Semiconductor and Texas Instruments are creating an exciting playing field for micro PV BOS solutions. All these approaches continue to put pressure on lowering installed PV system costs,  increasing the annual performance and increasing the market for less than optimal installations.  We will be seeing increased innovations from electronics integrated directly on the back of DC PV modules. It is all very exciting; the innovations, and our learning how they fit into the PV industry has just begun.

For more in formation on the American Solar Energy Society please visit ases.org and plan on attending the annual conference held in Denver May 13th 2012.

Joseph McCabe is a solar industry expert with over 20 years in the business. He is an American Solar Energy Society Fellow, a Professional Engineer, and is internationally recognized as an expert in thin film PV, BIPV and Photovoltaic/Thermal solar industry activities. McCabe has a Masters Degree in Nuclear and Energy Engineering. Joe is a Contributing Editor to altenergystocks and can be reached at energy [no space] ideas at gmail dotcom.

No Disclosures.

The post PV Micro Inverters and Optimizers: Not Just for Lazy Designers appeared first on Alternative Energy Stocks.

by Joseph McCabe, PE

Solar manufacturers are racing to build the next cadmium telluride (CdTe) photovoltaic (PV) factory in the United States. Three major CdTe on glass factories in the US have been recently announced each with a unique starting point. Abound Solar has won a US DOE loan to support a new 640 MW/yr facility in Tipton, Indiana. General Electric (GE) recently announced buying Primestar. They indicate that they will be building the largest PV manufacturing facility in the world. Finally First Solar has announced a 250 MW/yr facility to be built in Mesa City Arizona near Phoenix.  Let’s take a closer look to see which one of these factories might have the best advantage to be in the lead to generate revenue.  

First Solar
As the largest manufacture of PV modules in the world, First Solar Inc (FSLR) is the defending champion.

First Solar has produced so many factories, it almost seems like their real product is factories, not solar panels. They indicate a total manufacturing capacity of 1.5 GW/yr (that is gigawatts per year) at the end of 2010. They have plants in Perrysburg, Ohio, Frankfurt/Oder, Germany, and Kulim, Malaysia. They plan to increase manufacturing to 2.9 GW/yr including additional facilities in Vietnam and the United States by the end of 2012. They are well capitalized, and will finally be manufacturing in Arizona with a 250 MW/yr factory, where the corporate headquarters is located. Don’t blame First Solar on the long delay to manufacture in Arizona. Arizona has a backwards micro-economic energy policy. They import their fuel while exporting their dollars. With the 3,739 MW Palo Verde nuclear power plant dominating the electrical generating landscape of the state, solar energy has been a hard sell even with all that sun. The CdTe technology is very appropriate for the hot Arizona climate because of First Solar’s advantageous temperature coefficient in comparison to crystalline silicon PV technology. While Arizona has been debating solar for the last ten years, First Solar was building factories all over the world. This new facility is expected to take one year to build. Can Abound or GE build a factory and create markets faster?

Abound Solar
Privately held Abound Solar is the young colt with a rich patron.  In December 2010 Abound Solar closed on a long-anticipated $400 million loan guarantee from the U.S. Department of Energy (DOE) to fund the expansion of the company’s manufacturing capacity. They have an existing facility located in Loveland, Colorado with a nameplate capacity of 200 MW/yr.

Having a loan from the US DOE might seem like a great opportunity. However, getting the money and building the factory might take longer than anticipated. The first PV company announcing such an award was Solyndra, a copper, indium gallium and selenium (CIGS) thin film on tubes of glass PV technology. DOE had announced the Solyndra loan guarantee in March of 2009; however Solyndra failed to complete their initial public stock offering. With major delays, Solyndra indicates their annual production run rate will be approximately 200 MW/yr per year by the end of 2011, effectively eliminating them from this race.

Abound Solar, originally named AVA Solar, comes out of Dr. Sampath’s laboratory at Colorado State University. They have a few market channels for the PV product and have been exhibiting at trade shows for a couple of years.

GE
General Electric’s (GE) deep pockets might make the company seem like the odds-on favorite. But history has shown what GE can, or can’t do, when they buy PV technology. In 2004, GE purchased Astropower at bargain basement prices. At the time, Astropower had a nice niche to purchase scrap silicon and produce well respected solar modules. Astropower filed for bankruptcy in February 2004, and then GE purchased all the assets for $15 million. GE never really capitalized on that PV investment. With that purchase came a residential PV shingle called the Astropower Gecko shingle. Before PowerLight had developed the SunTile (now the SunPower SunTile), Gecko was in the market and getting lots of California attention as a replacement to concrete tile roofing that made electricity. Have you heard of Gecko lately?

GE could have what Clayton Christensen describes as the Innovator’s Dilemma described in his book titled the same. The subtitle explains the book “When New Technologies Cause Great Firms to Fail”. GE was not able to capitalize on the Gecko PV roofing technology, nor the well-respected Astropower modules. One sunny note is the leader of the GE Solar organization, Danielle Merfeld, Director of the Solar Technology Platform at GE. She is an extremely technologically and business savvy person able to jockey any PV technology to a successful finish line. If she doesn’t succeed with GE due to the Innovator’s Dilemma, she will eventually succeed at another PV company.

GE has been a majority equity owner of PrimeStar Solar since 2008. In March of 2010, GE announced an expanded relationship with Primestar, located in Arvada, Colorado with an existing 30 MW/yr nameplate capacity CdTe factory. Then in October 2010 GE and Solar Frontiers, a CIGS PV on glass technology, made a surprise announcement of a technical and commercial agreement indicating problems with the Primestar relationship. Apparently with the new April 2011 GE announcement that it was buying Primestar, this Solar Frontiers deal might not be going as well as expected. This most recent GE Primestar news announcement indicated they will build the largest CdTe factory in the world, but did not indicate the specific location.

BP Solar
Today’s handicappers will do well to remember how British Petroleum (BP) lost to First Solar in the last race.  Before BP failed with the Deep Oil Horizon platform they had failed at CdTe. Opened in 1998, they closed their Fairfield, California CdTe plant in 2002, right about the time that First Solar was introducing its product to the market. First Solar’s IPO was in November of 2006 priced at $20 a share. Is there such a thing as corporate hindsight where directors can be held accountable for missing the potential $12B capitalization that First Solar now commands? BP was supposed to stand for Beyond Petroleum; now perhaps it stands for Beyond Prosecution. BP had decided that thin films were not going to be successful and eliminated all their investments. More recently they have closed their US PV crystalline silicon factory in Frederick, Maryland. BP Solar is an unfortunate scratch in today’s manufacturing race.

My Bet
Important factors this time around will include the ability of the thin film tool makers to execute on the factory orders, and if any one of them are caught in a Japan material shortage due to the tsunami after effects.

So who is going to win this race? My trifecta bet says First Solar to win, Abound Solar to show, and GE to place: It will not be a photo finish.  

Disclosures: Long FSLR

Joseph McCabe is a solar industry expert with over 20 years in the business. He is an American Solar Energy Society Fellow, a Professional Engineer, and is internationally recognized as an expert in thin film PV, BIPV and Photovoltaic/Thermal solar industry activities. McCabe has a Masters Degree in Nuclear and Energy Engineering.
Joe is a Contributing Editor to Alt Energy Stocks and can be reached at energy [no space] ideas at gmail dotcom.

The post The Cadmium Telluride Solar Factory Race appeared first on Alternative Energy Stocks.