Thoughts on Solar by Run on Sun's Founder & CEO, Jim Jenal

The Web is littered with sites proclaiming the benefits of solar as a Do-It-Yourself project and we have previously written about the perils of trying to do solar yourself.  But the recent windstorm in Pasadena provided dramatic proof that some things in life should be left to the pros - and solar is one of them.

Take this installation for example - in a lovely part of Pasadena, the previous homeowner designed and installed this system which had a number of significant problems from the get-go.  Here is the view of the site from the north looking south:

The panels that are mounted on the garage go all the way to the ridge, exposing them to higher wind forces.  There are enormous trees to the west and south-east that will provide significant amounts of shade.  The panels on the main roof (that mostly shaded shiny spot in front of the palm tree) are even worse as they are directly facing the tree to the south.  Indeed, from this view from the south, the panels on the main roof are completely invisible:

The array on the garage is pitched at 18° whereas the array on the main roof is completely flat.  Both arrays feed the same inverter which had only one MPPT channel - meaning that this system was never able to function at maximum efficiency.  Not a good design.

Now factor in the force of once-in-a-decade winds and life takes a definite turn for the worse.  The new homeowner called us to come out and assess the damage. Here’s how the array on the garage appeared when we arrived:

It doesn’t look any better in the other direction:

What happened here?

This array was attached to the roof using angle-iron from the local hardware store and simple wood screws, not lag bolts, to keep that hardware in place.  Here’s a close-up showing this homebrew attachment “system":

Those simple wood screws are a poor substitute for proper lag bolts but the previous homeowner didn’t even give his system a fighting chance as he ignored the rafters altogether (even though they were clearly visible) and simple screwed his gear into the plywood under the shingles. The result was as predictable as it was unfortunate:

Moral of the story?  The cost of adding solar professionally continues to drop, whereas the cost of doing it wrong is as steep as it ever was.

It was only good luck that prevented these panels from flying into the neighbor’s back yard.  If the wind had come during the day when the panels were generating power (instead of the middle of the night) the possibility of arcing and fire could have made things much worse.

So please, if you are thinking of adding solar as a DIY project this year, think again and call a pro.

Back in October, we wrote about some early trends from LADWP’s restart of their Solar Incentive Program and we thought it would be worthwhile to see how things have fared in the months since. LADWP had some flaws in the dataset issued in December so we decided to wait until the next revision which came out last week. (You can access the dataset here.)  As before, when reporting on project costs/Watt, we used the reported cost and the CSI AC Watts as we believe that is a more reasonable reflection of the value of the projects being proposed.

Prediction Update

In our previous post, we predicted that the Residential rebate program would drop from Step 5 (paid at $2.20/Watt) down to Step 6 (paid at $1.62/Watt) on or about November 26, 2011.  The last confirmed rebate reservation to be paid under Step 5 was #1120 and it was submitted on December 12 and confirmed on December 30.  So our November 26 prediction was not too far off, and a complete application that was submitted by then should have received a Step 5 rebate.

We also previously predicted that the residential sector would run out of rebate funds around April 3 of this year.  How has that prediction held up?  The chart below summarizes requested rebate amounts by week starting with the program restart on September 1, 2011 up through last week.  Also shown is the cumulative amount requested and a linear trendline.

As of the last day in the data, the total rebate amounts requested was $11.2 million out of the available $20 million.  It is also apparent from the graph that there has been a significant decline in the requested amounts following week 15 (starting December 8, 2011).  Our revised prediction is that the residential sector will run out of money around May 7, 2012.

Who’s Hot?

A program of this size provides some interesting insights into which manufacturers have the “go-to products” in terms of number of projects and total Watts.  Here is the data from the Residential sector:

Yingli leads the way thanks to their heavy use by SolarCity which accounted for 144 of the 188 projects using the Chinese panel.  Kyocera was a strong second, again benefiting from their use by SolarCity in 137 of their 155 projects.  Verengo Solar drove the demand for Suntech panels, accounting for 75 of their 99 projects.  Canadian Solar is the true democratic player in this field, its 80 projects were distributed amongst 31 different installers!

Not surprisingly, different panels demand different prices, but the results are not as clear as they might be due in part to how SolarCity includes its accounting/financing costs into its reported costs.  As a result, both Yingli and Kyocera are substantially higher on average in the data than one would otherwise expect.  For example, Yingli comes in at $8.91/Watt on average whereas Suntech is a mere $6.17/Watt - with both of these being top-tier Chinese panels.  The two manufacturers renown for their high-efficiency, high-cost products - SunPower and Sanyo - came in at $7.60/Watt and $8.07/Watt respectively.  No one in the industry believes that Yingli panels outperform those produced by SunPower and Sanyo.

Similarly, it is interesting to see what the distribution looks like in the realm of inverters.

No surprise that SMA leads the way, after all, SMA is the largest manufacturer of solar inverters in the world.  Their popularity is driven not only by major players like SolarCity (65 projects with SMA) and Verengo (89), but collectively by 55 different installers.  Contrast that with Fronius, which achieved its #2 ranking almost entirely thanks to SolarCity which accounted for 206 of the 231 projects (89.2%).

Coming in at a respectable third place was Enphase Energy with its 74 projects being distributed amongst 31 different installers - clearly the most broadly distributed installer base in the list.  None of the Enphase installs were performed by SolarCity or Verengo.  Given the shear volume of installs done by those two companies, surely some of those sites would have benefited from micro-inverters but the leasing giants were not making that technology available to their customers.

Finally, potential clients often ask about the difference in cost between a string inverter system, such as one using SMA inverters, and a micro-inverter system, such as one using Enphase.  The average installed cost for the 334 SMA projects was $7.15/W.  The average installed cost for the 74 Enphase projects was $7.32/W.  That is a negligible difference and given that the two largest players in the data - SolarCity and Verengo - had none of the Enphase projects, we would expect the SMA projects to have a volume pricing advantage from those two companies alone.  Bottom line: in the real world, there is very little cost difference between these two technologies.

Outlier Update - A.S.E.S. Electrical - Still Out There!

One of the more disturbing things that we uncovered in our previous analysis was the degree to which some companies were apparently overcharging their customers.  In particular, we singled out A.S.E.S Electrical Group (aka American Solar Energy Solutions) for being particularly egregious in this regard.  So, after an additional three months of data, how have things changed?

Once again, we restricted the data to only residential projects where the system owner is also listed as residential - a total of 846 projects.  Our previous size filter was 20kW; for this expanded data set we increased the size filter to 45kW, meaning that only companies with at least 45kW of projects in the data would be included. As a result, the chart below accounts for 560 out of the 846 projects described in the data.

Sadly, our results are as disappointing as last time - check it out:

What is going on here?  While the average system price declined from $8.91/Watt back in September to $8.24 over the entire dataset, the disparity between the most cost-effective performers and the least is as great as it ever was!  Indeed, our repeat failure as the biggest gouger of solar consumers in Los Angeles is once again, A.S.E.S. but now their cost is more than three times the cost of the lowest price company, Ronco Solar.

Indeed, while A.S.E.S. did lower their cost somewhat, they apparently did it by replacing the Schuco brand solar panels that they were using before with third-tier Chinese panels from Sopray Energy.  (In contrast, Ronco consistently uses Canadian Solar panels, a top-tier Chinese solar panel.)

Certainly caveat emptor applies when purchasing a solar power system, but at some point it seems like the utility should step in and warn its customers about predatory practices.  So how about it, LADWP, isn’t it time to give your customers a heads-up about what is going on?

Put another way, if you are considering going solar and your installer proposes a system that is more than $8.24/Watt - and indeed, that is a very high number for installations today - we have one word of advice: RUN!

The most overlooked story of this weekend was the announcement that the National Highway Traffic Safety Administration (NHTSA) gave the Chevy Volt a clean bill of health, determining that the vehicle does not pose any unusual risk of fire. But will the damning press coverage that tried to paint the Volt as the heir apparent to the Chevy Corvair’s “unsafe at any speed” moniker, reflect these vindicating results?

As you may recall, the Volt - Chevrolet’s first plug-in hybrid vehicle - was the subject of some very breathless reporting regarding vehicle fires that occurred during crash testing for the NHTSA.  Was the vehicle a potential “fire trap” in the case of an accident?  Here’s a not too atypical example of how the Volt was portrayed:

A symbol of the government bailout and continued ownership of General Motors, the Volt has been hailed as the vehicle of the future by the Obama Administration’s green energy pushers.
Now, the Volt is in danger of taking down the entire electric car industry as concerns about fire hazards involving the vehicles battery cooling system are creating a backlash across the nation.

Wow, that’s some pretty scary stuff.  So what did the NHTSA actually discover?  The agency reported that it “remains unaware of any real-world crashes that have resulted in a battery-related fire involving the Chevy Volt or any other electric vehicle.  NHTSA continues to believe that electric vehicles show great promise as a safe and fuel-efficient option for American drivers.” (Emphasis mine.)

Chevy has made a change to the vehicle that will be retrofitted onto all existing Volts and incorporated into the assembly of all new vehicles to prevent the problem that arose during the crash testing.  Aaron Bragman, an analyst with IHS Automotive told the LA Times, “GM came out with a fix for it because it was a public relations issue, but from an engineering viewpoint there really wasn’t a problem with the car, considering the conditions of the test needed to create a fire.”

This is all very good news for American consumers as gasoline prices are predicted to rise even more in the coming year.  Even better news for California consumers, Chevy will be introducing a California-only version of the Volt in March that will qualify for a $1,500 state rebate and, even more valuable, single occupant access to California’s carpool lanes.

It will be interesting to see how opponents of EVs, like the Leaf, and PHEVs, like the Volt, will spin this news.  More likely than not, they will ignore it altogether.

The California Public Utilities Commission (CPUC) has just rejected the anti-solar Network Usage Charge (NUC) proposed by San Diego Gas & Electric (SDG&E).  We first wrote about this cynical attempt by SDG&E to penalize solar customers back in November.  At that time we reported that SDG&E was claiming that solar customers “do not pay their fare share of costs incurred on their behalf by SDG&E to provide service, including use of the distribution system."  SDG&E made this claim despite being unable to identify what those costs actually were, and while ignoring the clear subsidy that solar customers provide to SDG&E by reducing their distribution costs by producing energy at the point of consumption.

SDG&E’s scheme to address this so-called unfairness was to impose a Network Usage Charge that would be applied to all residential customers.  SDG&E’s fig-leaf claim of ratepayer fairness could not hold up to scrutiny.  Since only solar system owners actually export energy back onto the grid, they would be singled out for the additional charge.  We doubted then that the CPUC would manage to do the right thing, given their dismal performance in setting up the compensation structure required by AB 920, and predicted that this fight would have to be won in the state legislature.

We are pleased to report that (at least this time) our skepticism was unfounded.

Commissioner Mark J. Ferron rejected SDG&E’s proposal, using language directly from the arguments of the solar community.  Ruled Ferron:

My concerns about the legality of the current proposal are based on the following analysis: The last sentence of subdivision (g) of Section 2827 [of the California Public Utilities Code] in essence provides that a utility may not create a “new charge” that would increase an eligible customer generator’s costs beyond those of other customers in the same rate class who are not eligible customer-generators. SDG&E’s proposed NUC is a new charge. While the NUC rate would apply to both customer-generators and those who are not customer-generators, it would apply differently to customer-generators, who would pay the charge on both incoming and outgoing power under SDG&E’s proposal. By contrast, the non-generator customer would pay a NUC only on incoming power. Thus, as proposed, the NUC might be viewed as imposing costs on customer-generators beyond those imposed on other customers in the same rate class. Further, the immediately preceding sentence of subdivision (g) states that “The charges for all retail rate components for eligible customer-generators shall be based exclusively on the customer-generator’s net kilowatthour consumption over a 12-month period, without regard to the eligible customer-generator’s choice as to from whom it purchases electricity that is not self-generated.” SDG&E’s NUC proposal raises concerns under this provision was [sic] well, because the NUC would base the generator customer’s charges on network usage that is unrelated to net kWh consumption.

Noting that the NUC proposal could have impacts in other IOU areas (both PG&E and SCE intervened on behalf of SDG&E’s proposal), Ferron ordered SDG&E to go back to the drawing board on their proposed rate structure filing and to produce one without the NUC by February 17, 2012.

This is an important victory for the existing Net Metering law in California and it means that - for now - utilities will not be able to tack on discriminatory charges onto their solar customers.  Nicely done, Commissioner Ferron.

Run on Sun has an opening for an extremely well-motivated salesperson to assist us in outside sales of top-of-the-line solar power systems for commercial customers. This commission-only position requires someone who is smart, eager to learn, loves talking with people, is impossible to deter, technologically savvy and looking to earn a good income without being tied to an office.

We provide the training and the leads. You provide enormous energy and enthusiasm and the demonstrated ability to get past gate keepers and connect with decision makers.

If you are interested, please send a resume in confidence to:

resumes @ runonsun .com (spacing to deter spammers).

Pasadena area residents preferred.