Before you can ever get a bid for your commercial solar project, you have to contact a solar installation contractor to come out to your location and perform a site evaluation. Actually, you should contact at least three contractors so that you have a set of bids to compare (more on that process below) - but how do you find them in the first place? Well, you could choose based on who has the most ads on TV or the Internet, or you could rely on Cousin Billy’s recommendation - but somehow that just doesn’t seem sufficiently scientific for a project like this. There has to be a better way - and there is.
If you remember that you need to find someone who will work NICELY with you, success is all but assured. And no, we don’t mean nicely, we mean NICELY - as in:
N - NABCEP Certification
I - Incentive provider (CSI or local utility) connected
C - City building department experienced
E - Electrician on staff
L - Local or national?
Y - Years in business.
Focus on those attributes and you will have found a contractor who will inspire confidence and guarantee a successful project. Let’s expand on why these particular attributes are so important.
The North American Board of Certified Energy Practitioners - NABCEP for short - provides the most rigorous certification process of solar installation professionals in the industry. Not to be confused with their Entry Level Letter that merely demonstrates that the person has taken an introductory course in solar, the NABCEP Certified Solar PV Installer™ credential is the Gold Standard for installers and consumers alike. Earning NABCEP Certification requires the successful candidate to have an educational background in electrical engineering or related technical areas (such as an IBEW union apprenticeship program), at least two solar installations as the lead installer, and the successful passing of a 4-hour written examination on all aspects of solar power system design and installation.
As NABCEP notes:
When you hire a contractor with NABCEP Certified Installers leading the crew, you can be confident that you are getting the job done by solar professionals who have the “know-how” that you need. They are part of a select group of people who have distinguished themselves by being awarded NABCEP Certified Installer credentials.
NABCEP’s website offers a database of all Certified Solar PV Installers - just enter your zip code to find the installers located near you. It is with great pride that we point out that at Run on Sun, all three of our owners have earned the designation, NABCEP Certified Solar PV Installer™ - and we know of no other solar power company in Southern California that can make that claim.
A second source of solar installers is the Incentive provider such as the California Solar Initiatives’ Go Solar California website. Every installer who has done a solar power installation for a CSI utility (i.e., SCE, PG&E or SDG&E) will be included on this list. Unfortunately, there are no other criteria associated with getting listed - and there is limited verification done to guarantee that the listed installer is reliable. If your job is in California, your contractor must be on this list - but this is a double-check only - not an ideal starting point for your search.
Another source for information about solar installers is your local utility’s point person for solar rebates. This person deals with installers on a daily basis, and while s/he won’t give you a specific recommendation, they may be able to warn you off of an installer whom they have learned is less than reliable.
Similarly, the folks in your local building department deal with installers regularly as part of the permitting/inspection process. Once again, they won’t be in a position to provide referrals, but they may be able to give you a warning if there are red flags associated with a contractor that you are considering.
Solar installation companies come in all sizes - from national organizations that have crews installing systems all across the country, to local operations that only work in a limited geographic region. To be sure, there are pluses and minuses on both ends — maybe lower prices for the national chain due to economy of scale in their purchasing versus greater attention to detail from a local company that lives or dies based on how well it satisfies its local customer base. And, of course, money spent on a local company tends to stay in the local economy - another consideration in tough economic times.
The last of the NICELY elements is to look at the number of years the company has been in business. Again, this is not a perfect indicator – some recent ventures really have their act together and some long-standing enterprises have long since ceased to really care about what they are doing – but at a minimum you want some assurance that the folks you are doing business with know how to run a business. Otherwise you run the risk of having a largely useless warranty and no one to call if things go wrong.
We would recommend a minimum of three-to-five years in the business of doing solar, with preferably a longer track record of running a business. Expertise in areas beyond just installing solar is also useful such as engineering, management and law.
The preceding is an excerpt from Jim Jenal’s upcoming book, “Commercial Solar Step-by-Step,” due out in July.
UPDATE - Read Part 2 of our series here: Who’s Hot and Who’s Not?
One year ago we wrote a three-part series analyzing six months worth of CSI data that turned out to be our most read blog posts ever. So back by popular demand, here is our analysis of the first half of 2012 CSI data in the SCE service area.
First a brief review of our methodology. We started by downloading the Working CSI data set dated August 22, 2012. (Here’s a link to the CSI Working Data download page, and here’s a link to the data set (8MB zip file) that we used for our analysis.) As we did a year ago, we limited our analysis to just the data from the SCE service area. To limit our time period to the first half of 2012 (equivalent of what we did last year), we took the latest of a series of milestone dates in the CSI data (from First Reservation Date to First Completed Date) and used that as our Status Date and limited that date to values from 1/1/2012 to 6/30/2012. Collectively, that accounted for 9,669 projects, an increase of 53% over the same period last year!
So that we can compare apples to apples, our analysis uses CSI AC Watts as the measure of system size (except where noted) instead of the more commonly reported DC or Nameplate Watts. Why did we do that? Well, not all 5kW Nameplate Watts systems are the same. Some systems use less efficient inverters whereas others have panels that have very poor temperature performance (as indicated by their PTC rating), and some sites are poorly oriented or have substantial shading. CSI AC Watts values take all of those factors into consideration - thereby giving a truer measure of the system’s actual performance.
Apart from the dramatic jump in the number of projects over the same period last year, how does the overall data for the first half of 2012 compare to that data from last year? Here’s what we found:
Even though the number of projects increased dramatically from the same time period last year, the potential installed capacity of the projects declined significantly. This may well reflect the expiration of the federal 1603 Treasury Grant program as it became harder to finance new commercial projects after the first of the year. Here’s how the averages changed from 2011 to 2012:
The average system size in the 2012 data dropped 46% from the same period in 2011. Likewise, rebate expenditures per Watt fell from $1.33 to $0.94, or 29%. At the same time, the system cost per Watt also declined, but far less dramatically, from $6.37 to $6.13/Watt. We will have more to say about system costs later.
Altogether, the data reflects a total of 519 different solar contractors, of which 213 (41%) were responsible for only one project.
One intriguing item we noted last year was the significant number of projects - a full 11% - that were categorized as “delisted” meaning that they had been cancelled for one reason or another. How did that number fare in our new data? It dropped significantly down to just 4.2% of all projects, 6.3% of the potential installed capacity.
Of course, projects can be cancelled for a host of reasons. Nevertheless, we decided to see if there were any companies that jumped out as having an unusually high rate of delisted projects. We listed all of the companies that had any projects flagged as delisted (a total of 113 different companies) and compared that to their total number of projects. We extracted those companies that had ten or more delisted projects and rank ordered them by the percentage of all projects that were delisted.
Here’s what we found:
Holy smokes, what is going on here? Either Remodel USA, Herca Solar and A1 Solar Power are really unlucky, or something about how they create projects would seem to be problematic. We will have more to say on this point in a subsequent post in this series.
Oh and a note to Do-It-Yourself’ers - you have a one in twelve chance of not completing your solar project. Maybe solar really is something better left to the pros!
We closed Part 1 last year by looking at how the size of a system drives down the cost, and we wondered if the same would hold true this year? To find out, we excluded delisted projects from our data and divided the remaining projects based on system size with one category being systems below 10kW and the other being between 10kW and 1MW. (Strangely, we had to exclude some real outliers from our “small” system category - can you believe it, we found systems priced at over $30/Watt? Again, much more to say about that in a subsequent post.)
Here’s our results for the small system category:
Our trend is still downward as system size gets larger, but the slope is not nearly as steep as it was in our corresponding graph last year. Costs start at $8.59/Watt for the smallest systems and decline to an average of $6.41/Watt for systems just under 10kW. That’s a rate of decline of $0.24/Watt per kilowatt of system size increase, in constrast to a rate of decline of $0.34 last year. Certainly as component costs decrease, their related economies of scale would likely flatten out and that is what this data appears to be showing.
Finally, then, let’s turn to the “big” systems - those between 10kW and 1MW - how did our system costs do in that group?
Again, another outlier as our highest system cost here is higher than it was a year ago - $16.50 vs $15.50/Watt. Overall, we continue to see the downward trend as system size increases, but again, not as pronounced as it was a year ago. This year, we see the average cost of a 100 kW system coming in just below $6/Watt whereas a year ago the 100 kW benchmark was closer to $6.80/Watt. So our trend line is lower, but flatter than a year ago.
Moreover, we see far few systems in the 500kW and up category compared to last year. Specifically, this year we have only 24 projects that crossed that threshold (10.98 MW total capacity), compared to 32 last year (21.6 MW). Bottom line - projects have gotten smaller and really large projects have dropped off substantially. Without the pull of those larger systems, it is not surprising that we are not seeing the same downward pressure on costs for larger systems.
That’s enough to get us started. Yet to come: whose equipment is hot and whose is not? Any significant new kids on the block (be they installers or products)? And who are our outliers this year? (Hint - you’ve already seen some of those names!) So stay tuned as we name names and follow the data wherever it may lead!
And of course, if you have thoughts on cuts of the data that you would like to see, please let us know in the comments.
The latest newsletter from the California Solar Initiative (CSI) highlights some of the precedent shattering developments in solar this past year. Here’s our summary of the most notable developments this year:
We will be writing more about the details of all of this growth in the New Year. What oddities and outliers will we discover then? Stay tuned!
We have previously noted some pretty outlandish outliers in the cost of installing solar power systems in California, but now that is going to change. Under SB 585 (Kehoe D-39) that was just signed into law, the Public Utilities Commission (PUC) has 90 days to establish and impose cost caps on residential and non-residential solar installations for the California Solar Initiative (CSI). From our perspective that cannot come a moment too soon.
Senator Kehoe’s bill started out as an urgency measure to refund the CSI program which had exhausted its available funding for projects in PG&E and SDG&E territories. The bill still does that, directing an additional $200 million into the program and that is a very good thing. But what we like every bit as much is the amendment that was added in the State Assembly which provides for the following:
Within 90 days of the enactment of this act, the Public Utilities Commission shall establish and impose project cost caps for residential and nonresidential projects under the California Solar Initiative, based on national and state installed cost data.
We believe that this is an important, and long overdue consumer protection feature for CSI and we hope that other rebating entities such as LADWP and PWP will also adopt such caps.
Why is this so important? Well, take a look again at this chart that we prepared from the CSI data for the first half of this year showing the reported installed costs for the largest solar installers in the CSI program:
The range here is striking, even shocking. At the low end you see an installed cost of $6.56/Watt, ranging all the way up to an outlandish $13.32/Watt! And that price is an average over hundreds of installations by Galkos Construction. If the PUC were to establish a hard cap for residential installations of, say, $10/Watt and if that cap had been in place during the first half of the year, the customers of Galkos Construction would have saved $2.97 million - or on average, $7,618 each!
The cap, of course, should be lower than $10/Watt. We sincerely hope that the PUC will look closely at the abuses evident in the CSI data and put some teeth into this new law. Only then will potential solar clients be protected from the predatory actions of the few outliers that needlessly inflate costs to pad their pockets.
The California Solar Initiative (CSI) is responsible for overseeing solar rebates for California’s three Investor Owned Utilities (IOUs): PG&E, SCE and SDG&E, and in that role the CSI program collects some very interesting data. As we have in the past, we decided to dip into the data from the first half of this year to gain some insights into the State of Solar in California. Over the next several days we will be reporting on what we have learned - and there are some very surprising things in here to be sure!
A word first about how we processed the CSI data. We downloaded the most recent active data set as of this writing (the August 24, 2011 data set to be precise) and parsed it into Excel. Since we were only concerned about systems in our service area, we excerpted out just the data from SCE. To narrow our focus more, we wanted to only look at applications that had significant status during the first half of this year. The CSI data has a host of date fields - we took the latest of the fields ranging from First Reservation Date to First Completed Date as our Status Date and excerpted those that fell between 1/1/2011 and 6/30/2011 - a total of 6,306 data points.
That’s a fair amount of data but it necessarily omits any data at all from the municipal utilities such as Pasadena Water & Power (where we do much of our work) or LADWP. Unfortunately, none of the munis make their program data generally available - which is particularly odd given that the local residents actually own those utilities (and thus, their data) - but that is a topic for another day.
Finally, for the purpose of these posts, all system sizes are reported in CSI Rating AC Watts (to account for differences in equipment choice and system design) as opposed to DC (or nameplate) Watts.
What can we say about those 6,306 projects? Collectively they account for 164.7 MW of new solar power at a total installed cost of just over $1 billion - with incentive amounts totaling $219 million - roughly 21% of the installed cost. Unfortunately, not all of those are built - or even ever will be. Fully 11% (698) of those projects have the status ‘Delisted’ - meaning that they have been cancelled for one reason or another. Those delisted projects account for 37.8 MW of potential solar power that presumably will never see the sun. (Do some installation companies have a significantly higher rate of “delisted” systems? We will answer that question in a subsequent post - stay tuned!)
The remaining 5,608 are split between “Installed” and “Pending” with 55.8% (3,131) installed and 44.2% (2,477) pending. Breaking that down a little more, the installed projects account for 33.8 MW worth $240.1 million with incentive amounts totaling $57.1 million. In contrast, the pending projects account for almost three times as much capacity at 93 MW worth $575.8 million with incentive amounts totaling $120.6 million. (That is, nearly three times the to-be-installed solar cpacity for roughly twice the rebate dollars.) On average, installed projects cost $7.09/Watt whereas pending projects cost $6.19/Watt - a positive trend for consumers since it shows the cost of solar power systems declining over time.
Finally, for today, let’s examine whether the data supports the notion of solar economy of scale - that is, as system size increases does the installed cost/Watt decline? To get a handle on that, we took two different cuts through our data set - “small” installed or pending systems <10 kW, and “large” systems ranging between 10 kW and 1MW.
First, here’s the graph for the “small” systems (consisting of 4,992 installed or pending systems - click on the graph to view full size). As the trend line makes clear, larger systems really do drive down costs - decreasing from over $10/Watt at the small end of the range to just above $6/Watt for systems around 10 kW.
Another interesting observation from this graph are the outliers - with some data points below $3.00/Watt (mostly from self-installed system) all the way up to nearly $18/Watt!!! (We will have way more to say about those data points - and who is responsible for them - later in this series.)
If we now look at larger systems - those between 10 kW and 1MW - our data set has 587 such systems and again, the trend line shows the decline in system costs as system size increases. (Note, because there is such a huge range in system sizes on this graph, we plotted the system size on a log scale.) Some of these outliers are also pretty curious - a 200 kW system coming in at over $14/Watt?
Of course, this data is showing what happens when an individual project gets larger and there the trend is clear. One might well ask, does the same trend apply to larger installation companies? In other words, as a company has more and more installs, does that economy of scale translate into lower costs for the end consumer? That’s a very interesting question and the answer - coming in our next post - just might surprise, or maybe even disturb you.
If there are some other cuts of this data that you would like to see, just let us know in the comments. Trust me, we are just getting started!