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2Q14 LADWP FiT Progress Report

04/08/14

  11:26:00 am, by Jim Jenal - Founder & CEO   , 866 words  
Categories: LADWP, Commercial Solar, Feed-in Tariff

2Q14 LADWP FiT Progress Report

Yesterday we provided a recap of the results from the third tranche of LADWP’s Feed-in Tariff (FiT).  Today we are going to look at the status of the program overall, based on the newly instituted FiT Dashboard found on DWP’s FiT website.

Credit where its Due

We are often critical of issues with utilities, whether its undue roadblocks to installing solar or outright hostility to the entire concept of net metering.  So it is equally important to give credit where it is due, and the introduction of the solar “Dashboards” that are now featured at the DWP website is a great step forward in transparency and one that deserves to be widely imitated by DWP’s peers.  Here is how DWP explains the purpose of their FiT Dashboard:

LADWP is implementing the largest FiT program of any municipal utility in the nation. As it goes through growing pains, we continually work to improve the experience of customers and businesses who participate in it. The goal is to achieve the target level of solar energy, catalyze the solar industry and create jobs, and streamline the process to increase efficiency. This Dashboard outlines the issues, actions taken, and plans for improvement. The graphs show the current and targeted FiT processing timelines, schedule, and status of projects from each allocation.

The data discussed below is from the Dashboard update as of April 7, 2014.

FiT Processing Durations

While the complete flow chart for LA’s FiT program is more than a shade Byzantine, the Dashboard highlights processing times associated with three key bottlenecks in that flow: the initial Technical Screening that takes place when a project application is first submitted, the interconnection study which determines the cost for the proposed project to tie into DWP’s grid, and contract execution for the PPA between the project developer and DWP.  For each of these milestones, DWP has a goal of completing the work in four weeks.  In each case, DWP is missing those targets by a lot.

As of this writing, DWP is taking, on average, 6 weeks to complete the initial technical screening, 12 weeks (3x the goal) to complete the interconnection study and 14 weeks (3.5x the goal) to execute the contract!  Unfortunately, the Dashboard does not reveal how much of that delay reflects internal DWP processing times versus delays caused by the developer—breaking these delays down to reveal how that works out would be an important modification to the Dashboard.

While we can understand how incomplete applications and general, technical complexity could add delays to the first two milestones, we are baffled by the 14 weeks of delay in executing the contracts.  These are standard form contracts which, at least according to the program guidelines, are not subject to negotiation.  What could possibly cause a three-and-a-half month delay in getting those contracts signed?  Alas, the Dashboard does not reveal an answer to that question.

FiT Active Project Status

Which brings us to the status of all project applications in the queue.  Here’s DWP’s chart (click for larger):

FiT Active Project Status

The chart shows all 22 applications from the third tranche in the initial technical review as would be expected.  Shockingly, there are still 13 projects from the first tranche, over a year ago, that are still hung-up in that initial review!

Missing from this chart is the number of projects that are designated as cancelled.  By our count, there are 47 projects that made it through the lottery but have been cancelled for whatever reason.  (The most likely reason would be due to learning that the cost to interconnect to DWP’s grid—the major wild card in the whole process—turned out to be too expensive.  However, according to the data, only 21 of those 47 projects ever had the interconnection study completed, which means the majority of the cancellations had to be due to other, unreported, reasons.)

Seven projects from the first tranche are still waiting for the interconnection study to complete along with 37 from the second tranche.  Thirty-four projects, 17 each from the first two tranches, are undergoing the mysterious contract review process.  Only 9 projects have managed to get contracts executed and just two, both from the first tranche, have been commissioned.  (The blue bars represent projects from the demonstration phase.)

That’s a lot of solar in the pipeline—hopefully DWP can get the cancellation rate down and the completion rate up in the coming months.

Issues and Actions

Again to its credit, the Dashboard acknowledges that the program’s overall status is: “Needs Improvement” and steps are underway to improve the process.  Perhaps the most significant development is that DWP has assigned seven additional engineers to help work through this backlog.  But the Dashboard makes clear that to get to target goals, DWP needs to climb a very steep hill: “To achieve target turn-around schedule, staff must complete 10 interconnection studies per week over the next 7 weeks and 10 contracts per week over the next 10 weeks.”

Bottom line - DWP is working on a big and complex program and the performance to date has been less than desired, but the institutional attitude seems better than expected. Hopefully DWP will be able to deliver on its targets in the next 10 weeks. 

Of course, DWP looks positively stellar compared to the FiT performance of its neighbors, a topic we will return to tomorrow.

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Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
Run on Sun also offers solar consulting services, working with consumers, utilities, and municipalities to help them make solar power affordable and reliable.

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