It's been a long time coming - more than thirty years by some accounting - but solar panels are finally being re-installed at the Nation's most important home, the White House.
We first wrote about the President's promise to put solar panels on the White House back in October 2010 - and then about the mocking that the solar industry took from visionaries like Glenn Beck when that promise went unfulfilled. But now, multiple news outlets are confirming the story that originally broke in the Washington Post: work has actually begun on installing solar - specifically U.S. made solar modules - at the White House. Boy, talk about being delayed by the AHJ!
Of course, this isn't the first time that solar has been installed at 1600 Pennsylvania Avenue - in fact, it isn't even the second. Jimmy Carter installed a solar thermal system back in the 1970's only to have his successor, "Mr. Morning Again in America" Ronald Reagan, remove them. Make what you will of that sequence of events, but perhaps more interestingly is that solar came back to the White House, or at least its grounds, during the presidency of George W. Bush. That project was done with very little fanfare - indeed, we had not even heard about it until this week - but this New York Times article from February 2003 lays it out nicely:
Since September , a grid of 167 solar panels on the roof of a maintenance shed has been delivering electricity to the White House grounds. Another solar installation has been helping to provide hot water. Yet another has been keeping the water warm in the presidential pool.
James Doherty, an architect for the National Park Service, decided to install the systems a few years ago. It was time to replace the roof on what is affectionately called the Pony Shed, a maintenance building that replaced the stable that once housed Macaroni, a pony owned by President John F. Kennedy's daughter, Caroline.
The Park Service, which is responsible for the building, had already mandated that any refurbishments of its facilities should include environmentally friendly design where possible.
''We thought if we were able to reduce our energy consumption, that was a positive step forward,'' Mr. Doherty said.
That NYT piece is also interesting as it recaps the State of Solar as of 2003, noting that in all of 2001, just 36 MW of solar were sold in the entire U.S.! Contrast that with the more than 160 MW that was installed in just the SCE service territory during the first six months of this year and we really have come a long way.
A coalition of major utilities is calling on the California Public Utilities Commission to develop regulations that would require the use of so-called “smart” inverter technology on a “fast track” to address “issues” arising from the growing adoption of solar. But that got us wondering - is this really a concern now and is a fast track response appropriate?
(H/t, Solar Industry Magazine.)
The utility group, which calls itself WEIL, for Western Electric Industry Leaders, issued a letter on August 7 urging regulators to require the adoption of smart inverter technology, citing an “immediate need for the new solar generators that residents are placing on the grid in ever increasing numbers to be fitted with ’smart inverters’ to provide the necessary voltage support for us to integrate these resources effectively and prevent costly future renovations and reliability impacts." Wow, that sounds dire - solar power systems that residents are adding to the grid could create “reliability impacts". Quick, do something!
The letter continues:
However, if smart inverters are not installed, these voltage swings [due to PV output variability] can potentially damage utility equipment and residents’ home appliances; increase overall cost of maintaining the grid; require continued installation of larger, more expensive alternatives; and could even contribute to distributed outages.
Is there a single, documented case of PV variability causing damage to home appliances? If there is, WEIL has certainly not identified it, although the prospect sure sounds scary.
To support all of this doom and gloom, the WEIL folks - headed by San Diego Gas & Electric - have produced a white paper that they claim provides “empirical support for smart inverters." But here’s the thing - it really doesn’t. First of all, where they set out to gather data in support of their contentions, the looked at systems far removed in size (and location for that matter) from what “residents” are installing on their homes. In talking about intermittency issues, the system that they looked at was a 1 MW (AC) PV farm on the end of a rural distribution circuit. Not clear how that is supposed to tell us about the impact of a 5kW system on an urban resident’s home. They then applied modeling analysis to a 2 MW PV system to show their improvement. Again, interesting - and possibly compelling for 2 MW systems - but irrelevant to the issue of what sort of inverters should we be installing on residential projects. Indeed, the smallest system that they even discuss is a 240 kVA inverter - still not relevant to the broader issue.
So they couch their scary letter calling for immediate action in terms of residential systems - but their “supporting” white paper says nothing at all about such systems. Nice.
Moreover, SDG&E touts the enormous penetration of solar onto their grid as a justification for the need for immediate action, noting that as of the end of January this year, they had 162.5 MW of customer owned PV capacity. They also cite how Germany - where solar is so popular - has recently had to adopt expensive retrofits and we should avoid that fate.
But let’s break this down.
According to the California Energy Commission’s February 2012 forecast for SDG&E electricity planning, 162.5 MW of capacity works out to roughly 3.6% of SDG&E’s current peak demand of approximately 4,500 MW. That same document predicts that by 2022, the highest estimate for PV from self-generation will be 350 MW out of a forecast peak demand of 5,500 MW - that is 6.4% under the most aggressive predictions for PV penetration (although I know our friends down in San Diego are hoping to beat those numbers). By comparison, renewables in Germany are around 23% of peak demand today - six times what they have in SDG&E territory and nearly four times what they expect to have by 2022! So where’s the fire?
“In circuits that have a decent amount of penetration – about 10 percent to 15 percent – you can start to see significant waveform changes, as you’ve got clouds coming over, systems switching in and out,” Niggli said.
Kinda makes you wonder how many circuits supporting residential solar customers are seeing penetration of 10 to 15%. Our guess is none, but in any event WEIL certainly doesn’t cite to any.
Moreover, inverters in this country have to satisfy a number of technical standards which in many cases are in direct conflict with what the utilities are now seeking. In particular, two features regarding expanded capacity to handle frequency variations and low voltage situations violate the anti-islanding requirements applicable to US inverter designs. Which is particularly ironic given that those requirements are there, not to protect household appliances, but to keep utility workers safe. Bottom line - until those requirements are changed, no inverter manufacturer can certify a product for sale with the “smart” features utilities are claiming they must have now.
So what is the real agenda here? Is there an “immediate need” for these new features to protect homeowners from scary PV? Not so much. Or, is there an immediate need on the part of the utilities to slow the march of solar until they can figure out Plan B? That seems far more likely.
By all means, let’s make solar as “smart” as we can, and if regulations should be modified to help make the transition to a clean energy economy smoother, then they should be modified. But spare us the scare tactics - it does nothing to improve the credibility of the utilities that signed on to WEIL’s Chicken Little letter.
Unicorns are a charming fantasy; mythical creatures from a world that never was.
But to activists trying to bring reason to the Climate Change debate, Unicorns are just as real as the world inhabited by climate change deniers. Noting that “one good fantasy deserves another,” yesterday, activists awarded Unicorn shaped statues to 135 members of Congress who deny that the climate is changing and that human activities are the cause.
Sadly, such mockery is well deserved. Look at this collection of jaw-dropping quotes collected just from members of the California Congressional delegation:
The earth cools, the earth warms…It could be caused by carbon dioxide or methane. Maybe we should kill the cows to stop the methane, or stop breathing to stop the CO2…Thousands of people die every year of cold, so if we had global warming it would save lives…We ought to look out for people. The earth can take care of itself.
Rep. Duncan Hunter
One of the difficulties in examining the issue of the climate change and greenhouse gases is that there is a wide range of scientific opinion on this issue and the science community does not agree to the extent of the problem or the critical threshold of when this problem is truly catastrophic.
Rep. Darrell Issa
We’re all told of course the debate is over and that all the scientists agree… and as all of you know, that is succinctly [sic] not the case.
Rep. Tom McClintock
However, scientists admit that they cannot be sure whether the Earth’s temperature is rising due to cyclical warming and cooling processes, or whether and how much humans are influencing it.
Rep. Devin Nunes
Too often, when congress is asked to pass environmental legislation, the legislation is based on emotional junk science rather than data based on reproducible, rigorous, tested, peer-reviewed results. In no area has this been more obvious than climate change. Because the Kyoto Treaty and much of the suggested environmental legislation would decimate jobs in southern California, constituents may be interested to learn of the growing scientific consensus that global warming is not manmade, if it is in fact even occurring.
Rep. Dana Rohrabacher
Wow. And because a picture is worth a thousand words, here’s some highlights (er, lowlights) of these wizards of Fantasyland in action:
Fortunately, we have our own antidote to this brand of concentrated stupidity. It is called solar energy and it is a great way to do your part in reducing our carbon footprint, making the world a better place for our children to inherit. Give us a call today and let’s start moving toward a cleaner world, no matter what the deniers say.
One of the greatest impediments to continuing to drive down the cost of solar are so-called “soft cost” - the nickels and dimes extracted from solar companies by nit-picking regulations and hoops that we are forced to jump through to get permits, inspections and interconnections accomplished. Now SCE has added yet another pointless hurdle that is simply designed to drive up the soft-costs for larger residential installs - but the question is, why?
On Friday we got a notice from SCE about the latest revision to their Net Metering Interconnection Handbook and calling attention to changes in their requirements for what is known as a “line-side tap.” Now to explain why this is an issue, please bear with me as this gets a bit technical.
Normally, when we install a residential solar power system, the power comes down from the roof, to a “solar only” subpanel, to a disconnect with a performance meter and then “lands” on a circuit breaker in your main electrical panel. Most recently built or remodeled homes in our service area have 200 Amp services which means that according to the National Electrical Code we cannot attach a larger breaker for solar than a 40 Amp breaker because the sum of all power sources feeding the bus bar that runs through your service panel cannot exceed the rating of that bus by more than 20%. Assuming that you have a 200 Amp main breaker, then your bus is already fed to the 200 Amp rating by the utility. That leaves 20% beyond the 200 Amps rating for solar and that gets you to the 40 Amp limit. (There are exceptions to this, but that is the general rule.) But the code limits us further since a circuit breaker intended for continuous operation has to be derated to 80% of its listed value. Which means that my 40 Amp breaker becomes a 32 Amp breaker for continuous use (defined as a source where the maximum current is expected to last for three hours or more). Since residential systems are running at 240 volts, that limits the maximum AC power of a residential solar power system to 7.68 kW.
Now that is rarely much of a limitation since the overwhelming majority of residential systems are smaller than that. But what about those that aren’t? What about the household that has two EVs (we have such clients) and lots of roof space? How can they interconnect a larger system if the Code won’t allow a breaker larger than 40 Amps?
The answer is a line-side tap. When you use a line-side tap, you avoid connecting to the service panel bus at all. Instead, you tap onto the wires feeding your service between your meter and your main breaker. This satisfies the Code and works just fine but it is a more complicated means of interconnecting your solar power system. As a result, SCE has required that systems that call for a line-side tap have a Professional Engineer review and approve the single-line drawing (SLD) that shows how the interconnection will be made. This adds to the cost of the system - PE’s have to make a living, too - but most installers have accepted that as a reasonable cost to insure safety.
But now SCE is requiring that in addition to submitting a PE-stamped as approved SLD, we must also submit a form letter, signed by the local Authority Having Jurisdiction, approving what we are going to do before it is done. Now what is the point of that? After all, before we can commence work we need to pull a permit, which means that the AHJ will have reviewed our site plan and SLD and deemed it acceptable. Once the project is complete, again we have to interact with the AHJ, having them come out to our job site and inspect our work. It isn’t as if we were trying to slip something past the AHJ.
So what is the point of this exercise?
Here is an excerpt from SCE’s letter that they are asking us to get the AHJ to sign:
If customer choses [sic] to continue to interconnect the generating facility on the source side of the customer’s main circuit breaker (tapping ahead of the main as defined by SCE), SCE must insure that the interconnection facilities continues to meet SCE’s safety requirements. Therefore in order for SCE to accept the modified equipment, SCE will require that this letter be signed by the inspecting authority. The Inspector for the AHJ acknowledges the following:
1. That the existing customer switchgear has been altered to allow the interconnection of the generating facility to the source side of the customer’s main breaker.
2. That the altered customer switchgear continues to meet UL certification requirements or that the modified equipment has been recertified for its new configuration.
3. That the modified equipment meets all the required NEC code requirements.
To reiterate, SCE considers the modification of the switchgear to be a safety issue and thus in order for SCE to approve the proposed generating facility, SCE must receive verification of UL and NEC compliance from the local inspecting authority prior to approving the generating facility for interconnection to SCE’s distribution system. It should be noted that in addition to this endorsed letter from the inspecting authority, the customer must comply with existing requirements including P.E stamped Single Line, plot plan, equipment requirement, etc.
Now in the first place, as a general proposition this really isn’t a modification to the switchgear (i.e., your service panel) at all. Instead, this typically consists of clamping on to the existing feeder wires coming into the service - the switchgear isn’t touched. But how many AHJs are going to be willing to sign this document - particularly when the utility themselves is now declaring this to be a safety issue? How much iteration is going to be required between the installer’s PE and the AHJ to convince them to sign onto this letter? And isn’t that the entire point of having the PE stamp the drawing to begin with? The PE’s stamp is her way of saying that the proposed plan is safe and complies with the Code.
In our view this is nothing more than an attempt by SCE to complicate the process of installing larger residential systems and to drive up our costs to do so. We have requested comment from SCE about their justification for this new policy - if we hear anything we will update this post.
Ok, listen up - you know who you are, you Outliers and Oddities - but now it is time for everyone else to learn your deep, dark secrets as we name names and tell all - at least all that can be told from the CSI data! Grab your popcorn and let’s dive in, shall we? (If you overlooked Part 1 of this series you might want to check it out to recall our Methodology.)
In looking at Outliers we focus on the Residential market since there is greater potential for consumers in that space to be exploited. After all, if you are building a 500 kW commercial project and you don’t do your homework, well, shame on you. But folks in the Residential space are more likely to be exposed to high-pressure sales tactics and other forms of abuse.
Another reason for looking at Residential systems is that the size range is very narrow: from 1 kW to 10 kW. That limits the amount of cost variance you would expect to find (and we found) if you were looking at larger systems. So the data here consists of Residential projects, both purchased and leased, but excluding MASH and delisted projects. This subset of the larger overall data set consists of 454 companies, 13,619 projects with a total capacity of 75.8 MW and an average cost of $5.84/W.
(Full disclosure, projects by Run on Sun came in at $4.78/W - proving that sometimes you can save money when you go with the best! But I digress…)
Companies in this subset varied between having just one project in the data (152 companies appear only once) to SolarCity which has a whopping 2,326 projects.
To make any meaningful comparisons we have limited the companies in this analysis to just the very largest players. Whereas last year we made that cut at 500 kW installed or more, today that filter still includes too many companies to readily compare, so this year we set the bar at an even 1 MW. Even at that threshold, we still have 15 companies on this list. Surely companies that large can afford to pass along their savings to their customers, right?
Here’s what we found:
Reducing our sample size in this way brought the number of projects down to 8,555 (62.8% of the total), total installed capacity to 45.6 MW (60.2%) and average cost down to $5.82/W. This last point is news since in the past, the average cost for the largest group was actually greater than the overall average. Not this year.
The next thing to notice is that SolarCity - the largest player in this field with 28.9% more projects than their closest competitor, Verengo - now is right smack on average at $5.82/W. It would appear that at least for CSI purposes, their cost data is no longer an outlier (though it may still be Odd - more on that later). However, their smaller competitor Verengo (at least as measured in this data) once again beat them on price.
On the low end of the scale, Petersen-Dean has snagged the crown from two-time low cost leader HelioPower - and they did it by far, being the only company to show a price below $5/W. Nicely done!
Which leaves us with the high end. The first thing to note here is that the industry seems to have cleaned up its act a bit from what we had found last year and the year before. According to the data, the highest price charged has dropped from $13.32 in 2011 (49% above the 2011 average of $8.91) to $10.50 in 2012 (45% above the average of $7.23) to our present $7.50 (29% above our average today of $5.82). So the data has really flattened out and our extremes just aren’t as extreme any more.
And yet, if relatively tiny Run on Sun, with no economy of scale going for it, can bring our projects in at $4.78/W, what is the possible justification for charging, on average, and over hundreds of installs, a price that is more than 50% higher than ours?
CSI’s cost cap as of today is $7.10/W for the Residential program. That means that two companies, GCI Solar and American Solar Direct, are averaging costs that exceed the CSI cap. American Solar Direct is huge - they have 675 projects in the data (ranking them third) accounting for a capacity of 2.6 MW (ranking them fourth). And yet with all of that size - more than twice as many projects as cost leader Petersen-Dean - they are still $1.29 above the average!
And what can we say of GCI Solar? That is the DBA of Killion Energy, Inc. which happens to be located at 15261 Connector Lane in Huntington Beach. But somehow that DBA seemed awfully familiar. And guess what, adjacent to 15261 Connector Lane is 15262 Pipeline Lane which is the home of perennial outlier, Galkos Construction. Could these be one and the same, just with a subtle name change? In the end, it doesn’t really matter - bottom line, $7.50/W is just too much for a large company to be charging.
Solar companies can also be outliers in ways other than cost - most notoriously, how long do they take to complete their projects. To take a look at that, we limited our data to Residential projects that also showed a First Completed Date in the data. We then averaged the number of days to complete projects as measured by the difference between the First Completed Date and the First New Reservation Request Date. Needless to say, that yields a smaller number of projects, so we lowered our threshold to 500 kW installed for inclusion on our list. Our new “time-to-complete” list includes seventeen companies, 4,865 projects and an installed capacity of 25.9 MW. Surely these folks must have their operational act together, right?
Here’s what we found:
The first thing we note is that, depressingly, the amount of time that it takes on average to get a project completed has gone up - from 157 days last year to 166 days now (a 5.7% increase). We are getting bigger, but as a whole, we are getting slower - not a trend designed to please consumers.
But some companies have improved significantly - most dramatically, SolarCity, going from 212 days last year to just 157 now - a 26% improvement, and comfortably below the overall average. Verengo, which actually has more completed projects in this data than does SolarCity, also improved from 134 days last year to 122 this year. One surprise - GCI Solar, our most expensive installer, was also the fastest of any of these companies to complete a project, taking just 115 days on average.
And then there is Elite Electric. Frankly we have no idea what is going on here but 320 days, on average, to complete a project is just plain crazy.
Last year we derived a somewhat novel metric for looking more closely at the impact of delay times in the overall industry. We called it System-Years of Delay, or SYD, which is the product of the total number of systems installed by a company times their difference in average days to install compared to the overall average, divided by 365. Thus companies that do better than average end up with a positive number, scaled by their impact on the industry in terms of the number of systems they installed, whereas laggards get a negative number, similarly scaled. We see this as an indication of whether a company is propelling the industry forward, or dragging it backward.
Here are our results for the data from this year (some companies that are grouped around the average are omitted for clarity):
As it did last year, Verengo continues to pull the industry forward and by a wider margin this year than before (172 compared to 111). Last year’s laggard, SolarCity, is now moving things in the right direction. But Sungevity continues to impede progress as do Burke Electric and Elite Electric.
Looking at this another way, assume that a system will produce, on average, 5 kWh/day for every 1 kW installed. Then the delay caused by these laggard companies ends up having real environmental impacts since we are missing out on their energy production for every day that they are completed beyond the overall average. Collectively, that amounts to more than 3 GWh of clean energy that were not produced and an additional 997 tons of CO2 emitted into the atmosphere.
Which brings us to the Oddities section of this post.
In the past two years we found something really odd in how SolarCity was pricing its systems, at least as it was reported in CSI data. We had noted back in 2011 that SolarCity’s price for its leased systems was far, far beyond the price it was citing for purchased systems, and far beyond what its competitor, Verengo was reporting. Then last year we discovered that the two competitors were now charging exactly the same thing for leased systems and that meant that SolarCity’s price had plummeted in just a short time. Going back and looking at all projects across the state resulted in this, rather startling graph:
So now that SolarCity’s IPO has come and gone, what are they - and Verengo - charging for leased systems? (We are excluding sold systems because they are really a de minimus share of either company’s business.) Here’s the cost data for installed, Residential projects, along with linear trend lines:
Interestingly, at the beginning of the year, SolarCity was actually reporting a lower cost than was Verengo. But as the year has gone on, SolarCity’s cost has crept upward - not by a lot, but the trend upward is clear. In contrast, Verengo’s costs have come down and their trend is equally clear.
Once again, Verengo follows a trajectory that mirrors the rest of the industry, while SolarCity pursues a course uniquely its own. Perhaps that is no longer odd, but to be expected.
Finally, we return to the strange case of that Ruler of the Delist - PsomasFMG.
In Part 1 we wrote about delisted projects. One company, PsomasFMG, LLC, had an astounding 79% of all of its projects end up being cancelled and thus ended up being “Delisted". That’s 33 projects with a total capacity of 8.6 MW - or more than 260 kW apiece. We thought that this was odd indeed and decided to look a little more closely at what was going on here. (H/T Imogen!)
Of the 33 delisted projects, all of their rebate applications were submitted in a four day window between January 25 and 29, 2013. All but one of those projects were submitted under rebate step 8b; the last one, on the 29th, missed the cutoff and fell to step 9b (it was later withdrawn). The 32 projects submitted under the higher rebate rate were apparently for Government entities in the cities of Pomona (29) and Diamond Bar (3). (We have searched for news accounts announcing those projects but so far have turned up nothing.)
All 32 of these projects submitted under rebate step 8b were cancelled by SCE for failure to pay the CSI-mandated application fee by the due date. Under the CSI Guidelines, non-residential projects that are larger than 10 kW are required to pay an application fee, based on the size of the project, to secure their rebate reservation (see section 22.214.171.124). Thus, to secure rebate reservations for these 32 projects that PsomasFMG submitted, they or their customers would have had to pony up $250,000 within 30 days of submitting the initial application. The rebate reservations at issue here were worth nearly $3.9 million - which sounds like a pretty good investment: pay out $250,000 to secure $3.9 million. But it never happened, and the applications were all cancelled.
So while we know why the applications became delisted - failure to pay the rebate application fee by the deadline - we still do not know why the company was submitting so many applications in such a narrow window of time that all ended up being cancelled. Odd indeed.