By Tom Cheyney
In this report from the Solar Asset Management North America 2018 conference, Kiterocket’s Tom Cheyney finds that whether it’s managing large solar portfolios or nascent energy storage assets, repowering older solar installations or buttoning up residential O&M, the smart use of data is key.
It doesn’t take a statistician to grasp the magnitude of the challenge—and the opportunity—facing the solar PV asset management and operations and maintenance (O&M) sector: there’s been more than 500 GW of solar installed worldwide, with 53 GW in the U.S. as of the end of 2017. Add in the first few of what will be many gigawatts of energy storage deployment, and the urgency grows to optimize these renewable assets and maximize their long-term value.
To meet this grand challenge, the old models and practices of solar portfolio management and O&M will no longer be sufficient. Endless Excel spreadsheets and incessant truck rolls won’t get the job done in this gigawatt age and certainly won’t bring costs down 50% over the next 3–5 years. The new normal must be based on cybersecure data analytics, smart performance modeling, predictive maintenance, and that catch-all term, digitalization.
This maturation of the solar/storage asset management and O&M sector was on full display here at the 2018 edition of Solar Plaza’s Solar Asset Management North America (#SAMNA18). Some 500 professionals gathered to hear presentations and panels addressing topics ranging from pattern matching and machine learning/AI, risk mitigation, repowering of older solar fleets, transition management, production insurance, aerial analysis (drones!), mergers and acquisitions trends, fintech, residential O&M, warranties, cybersecurity, and energy storage/solar plus storage.
Michael Alvarez of Longroad Energy focused his opening keynote on the challenges of an aging solar fleet. He cited that astonishing GTM Research statistic that some 76% of U.S. solar installations are 10 years old or less—which means that an increasing number of plants are and will be coming off warranty over the next years.
With years of experience managing wind power assets, Alvarez noted that solar can learn much from its breezy renewable cousins and needs to set a “standard of care.” Common sense dictates that if you take care of equipment properly, it will last longer, and the more proactive and prevention-minded you can be, the better. He cited several considerations for aging assets, such as end of warranty, supply chain and parts sourcing, O&M services continuity, expiring PPAs, and repowering.
For example, when it comes to the supply chain, he said it will become exceedingly difficult with so many suppliers having gone out of business—and that can take a big bite out of the energy generation and profitability of an older plant.
Underscoring the importance of identifying alternative sources of modules, inverters, and BOS components and looking closely at what you need to set aside for component reserves well ahead of time, he cautioned that “the reactive approach to supply chain is the largest single value killer in aging solar projects.” But Martinez also flashed a beam of optimism, noting that there is still a lot of value inherent in these older PV installations and that “storage will be the key to extending the lifetime of solar assets.”
The hot button topics of storage and solar-plus-storage O&M and asset management practices, use cases and the like found its way into several sessions.
The keynote panel, curiously titled “The End of Uncertainty,” found its way through the lessening of solar uncertainty in the aftermath of the U.S. Federal Tax reform and the Section 201 trade case into an additional morass of uncertainty when it comes to storage.
The consensus sentiment was that most projects will increasingly feature a combination of solar and storage, and that storage makes solar look more like a “conventional resource” to utilities, as 8minutenergy’s Arthur Habenstock put it.
But the operational management aspects of storage are very difficult, noted Laura Stern of Nautilus Solar. She believes that areas such as financial operations, warranties, monitoring, and the regulatory aspects of storage systems will be “very complicated” to deal with.
A couple of dedicated sessions zeroed in on how to integrate and manage storage to improve operations, create useable storage maintenance guidelines, harness storage’s own big data stream, and learn from early storage deployment stories.
Taking a page from the solar playbook, Anthony Conklin of Solar-Log noted how companies like his need to help take the burden off O&M providers’ backs by providing software tools to load, aggregate and manage “the tsunami wave of data” coming from storage assets. He noted that how there is much that can be learned from inverters as a base for measuring how long batteries will last (which is a known unknown, despite the models) and overall data visualization and management.
Panel participants agreed that there need to be performance standards for storage systems, that the state of charge and discharge were essential battery monitoring metrics, and that writing a warranty without knowing how the battery will be used—load shifting, frequency regulation, demand charge management, auxiliary utility services and more—is “pretty hard.”
As if anyone were in doubt about the nascent state of storage asset management and O&M, when asked if the industry was prepared to deal with storage O&M, the audience answered with a resounding “no” show of hands.
One of the more entertaining talks at #SAMNA18 was the market developments keynote by Cedric Brehaut, who runs the SoliChamba consultancy and produces those exhaustive global asset management, O&M and monitoring reports in conjunction with GTM Research.
In addition to a timely data dump and analysis of the U.S. residential, nonresidential (commercial, industrial, etc.) and utility sectors and emphasizing the rising impact and importance of digitalization, Brehaut tucked in an eyebrow-raising finding about residential O&M: customers won’t freak out if you tell them what can go wrong with their systems, if there’s a service plan in place.
Recent market data cited by Brehaut suggests that rather than hindering the more mainstream adoption of residential solar, a solid O&M service plan for homeowners may do the opposite and drive higher adoption. A survey commissioned by solar service plan provider Omnidian and conducted by research firm Model People Inc. found that the offer of a protection plan raised the “purchase intention” of new solar customers by 2X or 3X.
Brehaut concluded his remarks by saying that in the face of commodification, solar can no longer be seen as “special,” adding that “making solar a commodity takes hard work.”
Although he has a point, maybe it’s too soon to sound the death knell of differentiation just yet, especially when faced with the daunting task of getting O&M costs down to the $2/KW range.