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State of SoCal Solar 2013 - Part 1: Methodology & Trends

08/02/13

  10:58:00 am, by Jim Jenal - Founder & CEO   , 1419 words  
Categories: Solar Economics, Commercial Solar, Residential Solar, Ranting, 2013

State of SoCal Solar 2013 - Part 1: Methodology & Trends

Today is our first of three posts looking at the state of solar in Southern California for the first half of 2013 as revealed by the data compiled for the California Solar Initiative (CSI).  This first post explains our methodology and highlights some interesting trends in the data.

Methodology

Let’s start with our methodology.  The CSI collects a significant amount of data as part of managing its rebate program and most, though not all, of that data is made available to the public.  For example, while CSI collects data from installers that identify four components of system cost - solar modules, inverters, permitting and everything else - the data that is made available rolls all of that up into just one number - Total Cost.  Nevertheless, the CSI data is the most comprehensive data set available and covers all projects being built in the service areas of California’s three investor-owned utilities: PG&E, SCE and SDG&E.

For our analysis, we started with the CSI Working Data set from July 31, 2013.  (Here’s a link to the CSI Working Data download page and here’s a link to the data set (11 MB zip file) that we used for this analysis.)  This analysis just looks at data from the SCE service area and to limit our time period to just the first half of this year, we added a Status Date field to the data which is the latest of a series of milestone dates recorded in the data (from First Reservation Date to First Completed Date).  We then extracted our data for dates from 1/1/2013 to 6/30/2013.  After that it is a matter of pivot table magic!

One other note - there are multiple ways to identify the size of a project from the data: Nameplate Rating (i.e., DC Watts), CEC PTC Rating (which accounts for the PTC rating of the solar modules used times the efficiency of the inverters chosen) and CSI Rating (which applies the Design Factor to the CEC PTC Rating and which is the basis for rebate payments.  For the most part, unless otherwise noted, we will be using CEC PTC Rating for system size since that accounts for some measure of equipment quality but isn’t confounded by site complications such as shading or the use of tracking systems.  In particular, our $/W figures are computed this way.

Trends

Overall, our data set reflects 14,459 projects, up from 9,669 over the same period last year - an increase of 49.5%.

There are three program divisions in the data: Residential (projects under 10kW), Commercial (projects greater than or equal to 10 kW) and the Multifamily Affordable Solar Housing (MASH).  The overwhelming majority of these projects are in the Residential program: 14,028 (97% of the total) are Residential, followed by 387 (2.7%) Commercial and just 44 MASH projects.   However, MASH projects are generally associated with affordable housing developments and so they can be quite large overall.  In fact, the average MASH project is 158.7 kW, compared to just 5.6 kW for Residential and 216.3 kW for Commercial.  Altogether, Commercial projects account for 83.7 MW, followed by 78.8 MW in the Residential program with just 7.0 MW in the MASH program.

Compared to last year, which saw a decline in the amount of solar capacity in the data, capacity this year is up 59% over last year:

System capacity 2012 versus 2013

At the same time, the average system size continues to decline from 14.2 kW in 2012 to just 11.7 kW this year.  Likewise, rebates are falling (by 32%) but so are overall prices (15.2%), just not as fast.

Rebates and prices 2012 versus 2013

Still, in raw dollars, the reduction in system price of $0.97/W from a year ago, nearly triples the decline in rebate rate.

We will have lots more to say about system costs in subsequent posts.

The pace of projects is accelerating, driven by dramatic growth in the Residential program (as always, click on the chart to see it full size):

Projects per month(To make the Commercial and MASH projects visible we have put them on a second axis.) Residential projects have grown from less than 1,700 in January to nearly 3,800 in June!

MASH-Up

Since it is a relatively small slice of the pie we are going to generally ignore the MASH program but before we leave it aside, we thought we should at least take a peak at who are the players in this program.  Here’s what we found:

MASH players

Four projects have no solar contractor associated with them in the data (curious).  The big winner, however, is Shorebreak Energy Developers - not a company on our radar, but obviously a major player with nearly 2 MW worth of projects in the program.  A few familiar names - HelioPower, SolarCity and even our friends down the road at PHAT Energy (well done, Philippe!).

Roughly half of these projects are third-party owned:  24 of the 44 for a total of 3.5 MW out of a total 6.98 MW.  The average cost per CEC PTC Watt is also almost identical, $5.52 for third-party owned versus $5.55 for sold systems.  Yet within that average was a very significant range from a high of $13.12 for the 141 kW project being built by Lite Solar, all the way down to $4.32 for the 601 kW project being built by SPG Solar.  Shorebreak, the leader in the amount being installed and total number of projects is also a leader on price, coming in at $4.90.

Making the Delist

One stat we continue to find intriguing is the number of delisted projects - projects that got entered into the data but then cancelled at some point.  Altogether, there are 471 projects delisted, or just 3.26% of the total, down from 4.2% last year.  Those delisted projects accounted for 16.8 MW of capacity or 9.9%, which is up significantly from last year.  In other words, fewer projects were delisted, but they accounted for a bigger piece of the potential installed capacity.  The majority of the delisted projects, 324 of them (68.8%) were third-party owned.

149 different companies made their way onto the Delist - not surprising for very large players, but as before we decided to look at these companies as a share of their overall project total.  We limited to companies with at least 10 delisted projects and then rank ordered them by the percentage of their projects that are delisted. Here they are:

Delist leadersWhat is up with this?  PsomasFMG has 79% of its total projects delisted?  Turns out their 33 delisted projects account for nearly half the the total delisted projects by capacity.  Not surprisingly, these are all third-party owned Commercial projects ranging in size from 61 kW to just under 1 MW.

The other big winners, Electricare, Smart Energy, and Petersen-Dean had all of their delisted projects in the Residential program with sizes ranging from under 3 kW to just under 10 kW.  Interestingly, of the worst actors last year: Remodel USA, Herca Solar and A1 Solar Power, both A1 Solar (4 projects) and Remodel USA (1) still made the delist this go around, but with greatly improved numbers. (Herca Solar has 44 projects overall in the data, none delisted.)

While Commercial projects are necessarily more complex, making cancellations more likely, it is hard to understand a 15% delist rate for Residential projects. Caveat emptor.

Does Size Matter?

Finally, we turn to the question of size, and in particular how well does the size of a project drive down its cost?  For this analysis (and most of our analyses going forward) we are excluding delisted and wait list projects from our data.  Here’s our result for systems at or below 10 kW:

Installation costs versus system size 10kW or smallerAs in the past, we had to exclude a couple of outliers above $15/Watt: the farthest out there was Sun Pacific Solar Electric which charged $21/W for a 1.5 kW system and right behind was California Solar who installed a 7.9 kW project for over $16/W! We will have lots more to say about such Outliers next week.

Overall, the trend is clearly moving in the system buyer’s direction with the trend line reaching down to $5.40/W for systems sized at 10 kW, while a typical residential project of 5 kW comes in around $5.70/W.

Nevertheless, that is a very gradual slope indicating that prices are fairly consistent across system sizes in this program segment.

What about larger systems, do we see more of a downward trend there as system sizes increase?  Here’s the data:

Installation costs versus system size larger than 10 kWInterestingly, for the smaller projects there is very tight clustering right around the $5.70 mark where the trend line begins.  However, as you move up in system size, the clustering breaks down and system costs vary far more widely than they do for smaller systems.  Still the trend has 1 MW projects coming in around $3.77/W, compared to nearly $5.20 last year.

Ok, that’s enough to get us started.  Monday we will report on Who’s Hot and Who’s Not, and Tuesday will be our favorite post: Outliers and Oddities.  Stay tuned!

2 comments

Comment from: imogen [Member]  
imogenwhat does it mean when a project gets delisted? that the project didn’t happen? or just that the application for an incentive got rejected (and therefore project probably, but not necessarily, didn’t happen). and what can we infer from a company having a large percentage of projects delisted? is it that they are trying to reserve space in the queue for available incentive money by sending in applications for projects that aren’t necessarily going forward?
08/02/13 @ 12:24
Comment from: Jim Jenal - Founder & CEO [Member]  
A project can end up delisted for any number of reasons - the client could run out of money and not go forward. (We have had that happen!) Or there could be a falling out between client and contractor - or the originally listed projects could have been entirely speculative - it is really impossible to say from the data why the project ended up delisted. But having 4 out of 5 projects ending up delisted seems like a red flag.
08/02/13 @ 16:06
Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
In addition, Run on Sun offers solar consulting services, working with consumers, utilities and municipalities to help them make solar power affordable and reliable.

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