Thoughts on Solar

Last month during Intersolar, I (along with colleagues Sara and Victoria) was lucky enough to get invited to see a microgrid demonstration featuring the Enphase next-gen IQ8 at their headquarters in Petaluma, California.  As I had to sign an NDA as the price of admission, I was unable to write about what I had seen until today, when Enphase hosted their annual Analyst’s Day.  But I am no longer bound by that agreement, and can now tell you about what I saw. 

To say that I was impressed would be a gross understatement - quite simply, it was the most astonishing thing I have ever seen in the solar industry.  Settle in and let me tell you what I saw…

What Happens Today

Before I launch into describing the demo, let me remind you of what happens today.  All of the systems that we have installed are what is referred to as “grid-tied” which means that if the grid goes down, the PV system that is capable of back-feeding the grid also goes down, and remains down until the grid comes back.  (This is to prevent your house from being an island of energy, feeding the grid, and potentially injuring a worker trying to restore grid service.  As a result, this feature is known as “anti-islanding” and it is required of all inverter systems that are connected to the grid.)

Normally this is not a problem, but last month, when it got super hot out here (think 115° F hot!), both SCE and LADWP suffered dozens of outages, taking down PV systems across large swathes of LA County, and leaving frustrated PV owners without power, or A/C, just like their PV-less brethren.  Not good.

What I Saw in the Lab

Which brings us to what I saw at Enphase last month.

The lab looked like an ordinary industrial space, but with a series of household appliances and tools at one side.  There was a simulated array feeding a bank of IQ8 inverters, and a display that showed the output of the array (i.e., PV production), the total consumption from the loads, and any power being exported or imported to support those loads.  At the start of the demo the only load was a single red lamp, and the display indicated that it was drawing roughly 90 Watts.  The PV array was producing roughly 1.9 kWs, so the excess 1,800 Watts was being exported to the grid.  All super normal stuff.

But then things got interesting…

One of the engineers switched off the breaker that connected the PV array to the grid… and nothing happened!  Well, actually, a lot happened, but what didn’t happen was that the red light did not go off.  It didn’t even flicker to the extent that we could detect it.  But then when you looked at the display you noticed something amazing.  Not only had the microinverters created a grid on their own in fractions of a second, but they had throttled the output down so that now the production of the PV array exactly matched the load of the red light!  And here’s the kicker - there were no batteries attached to this system!!!

But what fun is just having a light on?  How about some toast?  So they switched on a toaster, and it lit up, and the total load jumped by about 1,000 Watts, making the total load now around 1.1 kW, and the PV array scaled up to meet it!  Still no batteries.  And how about this - there was no central controller, no master-slave relationship between the microinverters.  Rather, this was the “hive mind” at work, as the micros sensed the demand and scaled up or down as necessary to meet that load!

But wait, there’s more!

The next load to be added was a grinder like you might find on your workbench in the garage.  All by itself, that device drew roughly 1,200 Watts, bring our total load to roughly 2.3 kW - more than the maximum output of our simulated array.  What would happen when that was added to the mix?  Surprisingly little.  The grinder spun normally, but the red light dimmed slightly.  What was going on?  The system’s “hive mind” had lowered the voltage slightly (a microgrid equivalent of a brown out) to meet the amperage demand of the new load mix!  So slightly slower than normal, cooler than normal, dimmer than normal, but all operating.

Of course, all good things must come to an end.  Our already overloaded microgrid faced one more challenge - a vacuum cleaner with a significant in-rush current, far in excess of what the grid could sustain.  Indeed, as soon as they switched the vacuum cleaner to “on", everything shut off.  Nothing was damaged, the microinverters just shut off to protect themselves.

Turning on the vacuum cleaner served as the “ah-ha” moment for the potential homeowner - I guess I can’t run everything in grid outage mode.  So what do you do when something you just did produced an undesired result?  Well if you can, you undo it!  Turning the vacuum cleaner off, immediately restored the microgrid to its previous state of operation!  No delay.  No human intervention - just turn off that latest (over)load, and the system recovers on its own!

How cool is that?  Pretty damn cool, if you ask me!

Batteries Please?

So what about batteries, how do they play with this new system?  Just exactly as you would want.

The engineers added a bank of batteries to the mix, each with an IQ8 installed.  Now the display also indicated the battery’s overall state of charge, and whether they were charging or discharging.  Reset the demo to just the red light as a load and the batteries at 30% state of charge.  The PV array output jumped back to its maximum, with the surplus energy being used to charge the batteries.  As more loads were added, the PV array remained at maximum output, and as needed, drew power from the batteries.  Should the batteries reach full capacity and the PV output is greater than the loads, the microinverters will once again throttle down.

Sweet!

What’s Next?

I hope you agree that this was an amazing demo, and the IQ8 (or Ensemble, as Enphase refers to the overall system) has tremendous potential, both for Enphase as a company, and for so many nascent markets.  Think of how this product could have helped out in Puerto Rico, or in parts of Africa which have never, ever seen a grid!  Makes me want to book a trip to bring power to a village somewhere - hey Laurel, what do you say?

For our own clients, this has the potential to be the answer we have been seeking ever since Elon’s whoppers got people thinking about storage for the first time ever.

A point we raised with Enphase management is the need to have a reasonable upgrade path for existing clients.  Indeed, I have a call with Enphase tomorrow to discuss that very topic.  We know that current Enphase IQ products (the 6+ and 7+ we have been installing this year) will be compatible with Ensemble.  We expect to be able to work with older systems, though there may be a higher retrofit cost.  When we have that information, we will surely let you know!  The IQ8 is expected to be available in 1H2019… watch this space!

After a narrow miss last year, Run on Sun has rejoined the ranks of Solar Power World’s Top Solar Contractors list for 2018.  This is our fifth appearance on the list in the last six years.  Talk about punching above your weight!

The Top Solar Contractors list was developed by Solar Power World to recognize the work completed by solar contractors across the United States. Produced annually, the Top Solar Contractors list celebrates the achievements of U.S. solar developers, subcontractors and installers within the utility, commercial and residential markets, and ranks contractors by kilowatts installed in the previous year. The 2018 list was released on July 24.

“Solar Power World is very excited about the 2018 class of Top Solar Contractors,” said Kelly Pickerel, editor in chief of Solar Power World. "Our 2017 list showed impressive installation numbers after 2016’s huge rush to meet ITC requirements, and many companies were hesitant to show unavoidable installation dips after last year’s high. We’re happy to feature a strong group of thriving U.S. solar installers on the 2018 Top Solar Contractors list. These companies truly are at the top of their markets.”

Two things stand out in my mind as I look back on these past six years.  First is the incredible dedication, passion, and plain hard work that has been provided by the Run on Sun team.  We may be small, but together we are mighty!

The second, and ultimately more important (to say nothing about humbling), thing is the trust that our clients have placed with us. Every kilowatt installed represents a client’s belief that we will fulfill our promises to them.  Every referral demonstrates that we have met that challenge.  I know that the RoS crew is working hard every day (even in this heat!) to meet our commitments, and to help our clients move forward with a clean, solar-powered future.

Now bring on the Gala!

Our recent heatwave is a potent reminder of a sad solar fact: generally speaking, if you have a solar power system and the grid goes down, or even just drops really low as it did in Altadena this past weekend, your solar power will also go out, leaving you sweltering in the heat with everyone else. 

But why?  And what can you do about it?

Anti-Islanding

Every system that Run on Sun has installed is what is known as grid-tied.  Those systems are designed to shut down when the grid goes departs from a fairly narrow range of voltage and/or frequency.  The reason for this is simple - safety.  Imagine this scenario: a tree snaps in the wind and takes down a power line.  What does the utility do?  They shut off power in that area - causing any grid-tied solar systems to shut off -  and then they send a crew out to restring the line.  Once that is done, they restore power to the area and all is well.  The grid-tied systems sense the restored grid and turn back on automagically.

But now consider this - what if your solar system didn’t shut off when the grid failed?  Well you might be happy because your A/C would still be running, but what about that excess energy that your system is feeding back to the grid?  It is possible that you would energize the very line that the utility workers are coming to repair.  Your solar system is now its own “island” of energy production, and it could pose an extreme hazard to the unwitting linespeople.  And that would be bad.

Thus the need for “anti-islanding” - the intelligence built into your inverter to keep workers safe.

Comfort is just a Microgrid Away!

So what can you do about it?  How can you keep your solar investment running even when the grid fails?  The answer is in a microgrid which requires two key features: isolation and self-starting.  The isolation follows from the anti-islanding discussion above - you need to make sure that your system cannot export power back to the grid.  This is generally handled by installing a “transfer switch” which can be either manual or automatic.  

The second step is harder - you need something to emulate the grid.  In off-grid systems that involves a bank of batteries and a special battery inverter that can use the power of the battery bank to start-up and create what appears to be a grid.  Now the solar system “sees” what looks like a stable grid and can come back online.  That sounds pretty easy, but there are complications.  In particular, the inverter that forms the grid must also be able to match the output of the solar system precisely to the needs of the house.  Remember, there is no grid out there to absorb excess energy, so you need a way to throttle the output of the array up and down to avoid over production.  

Storage is generally a key component here, as it can absorb excess power (at least until the battery is full) and help smooth out the energy flow.  All of which has historically made for an expensive addition to a solar system just to hedge against an infrequent occurrence.

Perhaps this past weekend’s outages will cause some folks to reconsider.

Cue Intersolar

Which makes the timing of this year’s Intersolar trade show ideal.  Running Tuesday-Thursday of this week (in cool San Francisco, thank you!), Intersolar is bringing together solar and storage manufacturers as they demonstrate their latest and greatest gear.  Finding a cost-effective microgrid solution is our number one mission this week, and we will be pressing our friends at Enphase for as many details as possible about their approach to solving this problem - watch this space!

Editor’s Note: This is the third installment in our three-part series:
My Electric Bill is So High! Will Solar Help?  
You can read Part One, How High is High, here, and
Part Two, How Do I Find Someone to Trust, here.

With apologies to the Lovin’ Spoonful, eventually you have to make up your mind between those competing bids you’ve received, but how?  Let’s walk through the proposal evaluation process and see if everything that you need to see has been included!

What’s in the Proposal?

Solar proposals come in all shapes and sizes.  Some are very short – just a listing of what will be provided, a price, and a place to sign.  On the other end of the spectrum are proposals that are twenty pages long, most of it boilerplate about what is solar and how does it work, and what a great company this is.  But strip away the boilerplate and are they really giving you much information that is specific to your situation?

What were the inputs?

The old saying, GIGO: Garbage In, Garbage Out, applies to solar proposals too.  In this case, the inputs are your past energy usage, and a detailed site evaluation that looked at your service panel and your roof.  Omit any of those inputs, and the output is likely to be of dubious value, or worse, it will mask the true cost of installing solar at your home, leaving you exposed to costly change orders down the road when the contractor “discovers” something that should have been addressed at the proposal stage!

Your energy usage for the past year is the key input – without it you’re flying blind.  If you are in SCE territory, your potential installer should be asking for access to your  interval data.  For most residential clients, that is hourly usage measurements over the entire year, and that is important to accurately model your savings under now mandatory, time-of-use rates.  Where interval data is not available, monthly, or worse, bi-monthly billing records can be used, but they will not provide the granularity needed to see how the proposed PV system will actually operate to offset your daily loads.

Assuming that interval data is available – we ask our clients provide it through a secure service called UtilityAPI – it is the installer’s responsibility to properly analyze it to know how large a system you need.  As we mentioned in Part One, we use Energy Toolbase for our data analysis as it is the most authoritative tool on the market.  The chart above shows the average seasonal usage for one particular client as processed by Energy Toolbase from the raw interval data.  This shows the average hourly usage over spring and summer, with a very dramatic peak on summer weekends around 5:30 p.m.  Recall from Part One about “low-hanging fruit” – what you are seeing here is an excessive A/C demand that, if it can be addressed, would greatly reduce the size of the PV system needed for this client.

Ideally, this analysis takes place before the site evaluation so that the installer is able to advise the potential client about actions to be taken to reduce their overall usage, and thereby end up with the most cost-effective solution tailored to their needs.

Detailed equipment line items

One of the things that we see on competitors’ proposals that never ceases to amaze us is the total lack of detail regarding the actual equipment that is going to be installed!  It is as if the homeowner is expected to pay thousands of dollars for a generic solar power system – but you wouldn’t spend thousands on a generic car, would you?  Moreover, how can you assess the value proposition of a generic system?  A company that proposes a generic system intends to install on your home whatever is on sale that week.  Maybe you get lucky, more likely you don’t, but in either case, you simply don’t know, and that is no way to make a major investment.

Your proposal should have line items for all of the major components of your system: the solar panels, microinverters, racking, and installation costs.  And those items should be specific, down to the model being selected and the per unit cost.  Only that level of detail allows you to see what you are getting and for how much.

Utility savings analysis

Determining how much your proposed PV system will save you in Year 1 is the key to the entire analysis of the proposal, and it is a two-step process.  First, your historical usage data is analyzed against your current billing rate to determine what your energy costs will be over the next year.  There are a couple of assumptions built into that assessment, namely that both your usage and your billing rate will stay the same.  If you have been in your home for awhile, your usage last year is probably a pretty good predictor of your usage next year.  On the other hand, if you moved in rather recently, or made a major purchase like a new EV, that will skew your usage going forward.  Similarly, last year’s bills were predicated on the exact details of your billing rate structure in effect at that time – and those are subject to change without notice.  So look at what the proposal projects for your bill next year without solar, and see how that compares with last year.

The second part is the more important piece - assessing how  your bill will change now that you have added PV.  Here’s where things get complicated, and a tool like Energy Toolbase becomes essential.  The proposal should show a model of your past usage overlayed by the production of the PV system.

As you can see in the graph above (click for a larger version), the darker blue is the historical usage (we are looking at two days in July), the green is the modeled production from the proposed PV system, and the pale blue is the net energy demand.  At the peak on the right, the PV system is producing 5.22 kW at a time when the historical demand was 11.95, meaning that the net demand from the utility is 6.73 kw – and that is the basis for what the client will be billed.  You can also see that there are periods in the morning when the system is producing more power that the client historically used, resulting in power being exported out to the grid – for which the client is compensated due to net metering.

This is the analysis that must underlie your savings analysis – anything else is simply guess work.

Cash flow analysis – payback over time

Part of any cash flow analysis is the cost of the transaction.  If you are making a cash purchase you know exactly what your transaction costs will be.  But if you are financing through the solar company, or heavens forbid leasing, those transaction costs may well be obscured, it not hidden altogether.  Make certain that you have all the information you need to determine exactly what that deal is going to cost you.

For the sake of discussion, we will assume that this is a cash purchase.  What other assumptions go into a proper cash flow analysis? To start, how long is the period of the analysis?  Ten years?  Twenty years?  Thirty years?  Beware of an analysis that simply says how much money you will have saved in the end, without calling out the period in question!  In our view, ten years is too short, and 30 years is too long.  But whatever the number is, make sure you are aware of it as you compare “total savings!”

Another key assumption is how much will utility rates go up over the lifetime of the analysis?  It used to be common to see rate escalators of 6-7% per annum, but there was no real data-driven basis for that number.  (In fact, long ago we used 6.7% based on a website that claimed that the California Energy Commission had published that figure.  But when we went digging for the source, we discovered it didn’t exist - there was just this circular linking of sites each claiming to have gotten this from the CEC!) 

Over time we have consistently reduced the value that we use for our models, so that now we are using 3%, which we think is reasonably conservative.  But this is really a matter of just throwing darts at a board, and no one really knows what that number will be. Keep in mind that for comparison purposes, you should be able to see what value was used, and the higher the number, the rosier the prediction!

PV systems degrade over time, and that output diminishment should be accounted for in the analysis.  Modern solar panels degrade less than 1% per annum (the LG panels that we use are around 0.5%), but in any event, make sure that is incorporated in the model.

Finally, the value of money in your hand today is, generally, worth more than money you will have at some point in the future.  How much more valuable is a function of the discount rate applied to those future savings.  If the model ignores that, your future savings are likely artificially high.  Again, no one knows what the right number is, but a proper model will account for it and allow you to know what you are comparing.

What’s in the Contract?

Strictly speaking not a part of the proposal, it is not a bad idea to ask to look at the contract before you pick a contractor.  Many solar contracts are very long, written in tiny fonts, with lots of legalese – all designed to make you throw up your hands and simply ask, where do I sign?  But slow down, friend, the devil may be lurking in those details!  Indeed, we have had clients who were ready to sign with another company until they looked at what was in the contract!

Ideally the contract should be written in plain English, it should clearly set forth what will happen, when, and how, and it should be even-handed.

An Important Caveat

Finally, it is important to call out what even the most carefully considered proposal cannot address - future uncertainty; in particular, what will utilities try to do, and what will the CPUC let them do!

Things outside of our control - CPUC & Utilities

If you follow this blog you will know that the solar industry is under constant assault from efforts by utilities – particularly the investor-owned utilities like SCE – to reduce if not altogether eliminate the economic value of adding solar.  Whether it is by lobbying for changes to the net metering rules (which just this past year imposed additional fees, charges, and mandated time-of-use rates), or designing utility rates that make solar production less valuable, there is a constant struggle behind the scenes to undermine the solar investment of thousands of California homeowners.  (And this is not at all limited to California – attacks on net metering and efforts to impose pernicious rate structures are a nationwide phenomenon.)

Things we can control - SolarCitiSuns & CALSSA

Fortunately there are a couple of entities out there that are working hard to preserve the value of going solar.  If you are a California homeowner with a solar power system, there is an organization specifically for you.  California SolarCitiSuns is perhaps a corny name, but its mission is crucial: to organize the political power of California’s thousands of citizens with solar on their homes or businesses, or anyone who wants to be part of advocating for a clean, renewable future.  If you have solar on your home or business, click here to join!   The investment that you are protecting is yours!

 And finally, solar companies, are you a member of the California Solar & Storage Association?  We are, and you should be.  Click here to join CALSSA today! 

Beyond that, rank and file solar workers – installers, designers, finance people, anyone whose livelihood depends on the solar industry – there is an action group that you can join, even if your company is not a CALSSA member!  Joining means that you will get alerts when a crucial vote is upcoming in Sacramento or San Francisco, and give you the opportunity to reach out and show your support for the industry that provides your livelihood.  It’s easy and important. Every solar worker in California – click on this link to join the CALSSA Action Network – the job you save will be your own!

So there you have it - everything you need to know about going solar – look forward to hearing from you soon!

Editor’s Note: This is the second installment in our three-part series:
My Electric Bill is So High! Will Solar Help? 
You can read part one, How High is High, here.

Unless you have been living completely offline and in a cave, you are aware that there are lots of solar companies out there looking for your business.  You’ve seen them on the Web, perhaps they have called you or even knocked on your door.  You probably realize that you should do your homework and get several quotes before going forward, but how do you even know where to look?  Fear not, we’ve got you covered!

Why Trust Matters

For most homeowners, purchasing a solar power system will be one of the most expensive purchases they ever make, after their home, their education, and a new car.  Moreover, a solar power system is supposed to co-exist with your home happily for the next twenty years or more.  For all of that to work out, you need to find someone you trust.  Your gut is a good gauge here – if someone makes you uncomfortable now, chances are you will be even less comfortable down the road.

Qualifications Count…

In the search for qualified contractors there are some basic qualifications, and there are more sophisticated ones.  Let’s start with the basics: is this contractor licensed?  In California it is easy to check that out, simply by going to the Contractors’ State License Board and search on their license number (it should be on the contractor’s website) or their name.  If they don’t have a valid license, run, don’t walk, away from them! 

Beyond just checking to see if they have a license, you can also check for the type of license (only A, B, C-10, and C-46 license holders are authorized to install solar), whether there are any public complaints against them, and the status of their bonding and workers compensation insurance.

That covers the basics, but how about something more substantive?  After all, you could hold any of the necessary licenses and never have worked on a solar power system in your life! Toward that end, there is no greater indication of qualifications than to be a Certified PV Installation Professional by the North American Board of Certified Energy Practitioners (NABCEP), a distinction I’ve been honored to hold since 2010.

How select are NABCEP Certified PV Installation Professionals?  According to CALSSA, there are some 86,000 solar workers in California, of which just 294 hold that NABCEP Certification, according to the NABCEP website. 

As NABCEP puts it:

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 professionals who have distinguished themselves by being awarded NABCEP Certified Installer credentials.

You can search for a Certified PV Installation Professional on the NABCEP website here.

So does Reputation

If checking qualifications matters when it comes to finding a contractor that you can trust, then so to does assessing their reputation, which these days is easier than ever to do.  Search sites, like Google, display reviews for local businesses (keep in mind the top few listings are paid ads), and major review sites will let you see lots of reviews of solar contractors “near” you.  (Near in scare quotes because often those companies are saying they will serve your area even if they are located far away.) 

More localized resources, like Nextdoor and Neighbor-2-Neighbor, provide a more cultivated collection of contractors from which you can choose.

Of course, nothing beats getting a recommendation from someone you trust who has gone solar, had a great experience, and their system has lived up to expectations.  If you don’t know anyone like that, you should ask your prospective contractors for a list of clients that you can contact.  Naturally, the contractor is going to list people who will tell you great things, but ask to come by and see the installation for yourself. 

Other factors to consider…

Years in Business

Companies that have been in business a long time may or may not do better work than a relative newcomer, but at least they have shown that they know how to remain in business.  (In the solar industry, that is not a small accomplishment.)   Older companies usually have more experience – although a newer company could compensate by hiring well-experienced people – and experience is important since every project presents its own, unique challenges.

Local vs National

National companies are sometimes perceived as having an advantage because they have the whole “economy of scale” thing going for them.  Yet often those “savings” aren’t going to the consumer, they are going to shareholders or venture capitalists who have funded the operation. 

Local companies, on the other hand, live or die on their reputation.  They can’t simply write-off a territory and expand somewhere else – if they fail locally, they are doomed.  So local companies often provide much better service to their clients.  On top of that, the money you spend on a local company helps support your own, local economy.  And hey, if you have a problem, you may well bump into your installer in the grocery store and you can tell her all about it!

Next Steps…

Ok - by now you know that your home is a good solar candidate, and you have found several trustworthy contractors.  Now all you need to do is look over their bids, choose the best one, and off you go!  But wait, how do choose the best bid?  Fear not, dear reader, that is coming in Part 3: Evaluating Competing Solar Proposals.