Insights from Pioneers of Big-PV
The question presently burning in the minds of many solar company directors is “How can my residential-focused PV sales and installation company successfully service the dawning Australian market for large-scale solar?” Faced with comparatively bleak prospects for residential PV for the coming summer, many are eying off the commercial PV sector as a way to survive.
While appetite from the residential PV sector will inevitably return, the largest growth prospects are clearly in the commercial and utility space. Low barriers to entry in the residential solar market may have instilled in many PV companies a misplaced confidence in being able to deliver large projects. But success at a residential level can’t be simply upsized, for large projects involve commercial, financial, and legal prudence far beyond what is required in residential installations. In this article, some Australian big-solar pioneers identify some of the perils and pitfalls that must be negotiated in order to develop a successful big-solar offering.
Our panel of respondents include: Rodger Whitby of Ingenero, who was heavily involved in the University of Queensland 1.2 MW array and the 235 kW Alice Springs Airport Solar Power Station; Brad McEldowney of Enertech Solar, who was the Engineering Manager and Design Engineer for Eco-Kinetics 8 MW system in Thailand; Lachlan Bateman of Clean Technology Partners, who was responsible for mechanical integration of MW-scale rooftop projects in Italy and Spain for Solar Century; Chris McGrath of Infigen, who was deeply involved in their Solar Flagships bid; and myself (Warwick Johnston of SunWiz), a design engineer on Stowe Australia’s award-winning 215kW Metricon Stadium BIPV system.
Commercial solar systems are driven primarily by return on investment and thus require commercial certainty. Performance guarantees are thus required, and can be a pre-condition for a project to progress – banks typically only provide project finance when it can be proven that a loan is serviceable under worst-case assumptions of solar resource. Not meeting the guaranteed performance typically imposes a financial penalty on the project developer. This can require obtaining back-to-back guarantees from suppliers, notes Lachlan Bateman.
Little wonder that rigorous analysis is crucial to project success. Investing in an expert design engineer can assist in identifying and evaluating significant cost savings that can make the difference between shelving or developing a project. On Metricon Stadium detailed design software (PVSyst) showed that power density could be reduced through intelligent wiring, thereby meeting the performance guarantee with panels that cost 14% less. On other behind-the-meter commercial systems, detailed modelling can identify the largest system size that avoids export of power to the grid, with its associated financial penalty. And roof assessment tools such as the SunEye and Australian-developed AppliCAD software can assist in rapidly identifying least-shaded locations for PV arrays on complex roofs that are often encountered in small-commercial premises.
After installation, project monitoring is key to identifying failures before they compromise yield – during a tour of European large-scale facilities, the author was impressed by the NASA-style control centre with three employees whose job it was to monitor the live feed screens. Such activities assist in ensuring superior financial outcome, identifying pre-emptive maintenance that can increase yields by valuable percentage points.
One of the major differences with commercial systems is the civil and structural considerations involved in mounting the panels. Lachlan Bateman spent many hours in a wind tunnel refining a non-penetrating roof-mounted system designed to create a lightweight, high-performance, low-cost framing solution that ensured that roof structure – and roof warranties – were not compromised. Rodger Whitby dealt with significant civil and mechanical construction work required on both of Ingenero’s solar farms. And structural safety was paramount in the Queensland-Government sponsored Metricon Stadium, in which 57 tonnes of solar panels were mounted 30 metres above the heads of 25,000 spectators. Given the general lack of familiarity in the residential solar sector with the specifics of the Australian structural design wind standards (AS1170), servicing a commercial market often means encountering situations well beyond core competencies.
Financial penalties for project delays can keenly focus the attention, creating stress but also inspiring creative solutions. The project completion date may be set by factors as obscure as an end to a government incentive, onset of the rainy season, or the need for grass to be well-established prior to a football match (Metricon Stadium). The challenges can be heightened on new-builds, in which the solar team must integrate and coordinate with (plus be subordinate to) many other trades and professions. Rodger Whitby knows to allow for weather, having worked through unseasonal high rainfall in the desert and a Brisbane’s worst flood in decades. In the latter case, the impact of unavoidable delays was minimised by re-arranging the installation schedules, so that extensive cabling work was completed at the University of Queensland well before panels eventually went on the roof. “Even so much of the installation crew had to be demobilised and remobilised several months later when replacement panels and inverters arrived”. On commercial projects, herculean efforts are frequently required to meet timeframes, and flexibility is key.
Installation of big solar involves logistical challenges on a scale and of a flavour not encountered in residential solar. Brad McEldowney stresses the importance of logistics for successful on-time and on-budget delivery of project. Installation of a multi-megawatt array invariable demands accommodation and catering for hundreds of workers, and the nearest town is typically too small to handle such peak demands. To meet deadlines on Metricon Stadium, panels were air-freighted from the Netherlands early, which gave Stowe Australia the opportunity to test and refine its processes for a smoothly-flowing rollout, supported by interspersing shipments from air and sea to ensure a continuous supply of panels. Set against pressures of time, logistics can make or break a project.
And the rest
The most commonly encountered challenge on commercial systems is grid connection, approval for which can take months and involve unforeseen costs. But connection is just one potential headache of many. Rodger highlights the need for “permitting and approvals, environmental assessments, traffic management plans, funding deeds, bank guarantees, as built drawing, step up transformers, high voltage work, boundary fences, on-site amenities (toilets), dust suppression, container storage, security, etc. etc”. Project support activity goes well beyond that required on a residential installation
Keys to Success
So, how to navigate this minefield of challenges whilst developing in-house capability and a reputation? Whitby emphasises the importance of “Careful planning, good design, quality solar components, excellent project management and a close working relationship with the client.” McEldowney also stresses the importance of relationships with suppliers, and a co-operative design team. Something new will be encountered on every job, but open honest communication with the client is essential for healthy project outcome – this was a given understood by all working on Metricon Stadium.
But the learning curve can be steep. Bateman notes that the EPC team he worked with in Europe only became profitable once it had integrated the lessons learned from installation of three projects. One step wrong can blow a whole in your budget, and for companies to survive their first three less-profitable commercial jobs may require deep resolve and deeper pockets. This serves as a reminder of the importance of learning-by-doing, which should be enhanced by a post-project review process.
To cut teeth on the commercial market, it therefore makes sense for residentially-focussed PV companies to tackle progressively larger systems. Fortunately, just such an opportunity exists: solar power on small businesses which often face higher electricity prices than residential sector. The requirements here are a taste of those at larger scale: opportunity pre-evaluation, niche-targeted marketing to reduce customer acquisition costs, long project gestation periods, involvement of the financial sector, detailed design to avoid export of power, and a need for excellent relationship management and project management. Strategically investing in developed skills and amassing experience here could secure a position in Australia’s next big solar market.
Warwick Johnston is Managing Director of SunWiz, a boutique solar consultancy that provides outsourced design and engineering services. Warwick has been involved in four multi-award winning commercial PV projects – an EcoGen 2011 presentation on lessons learned from Metricon Stadium is available on the EcoGen website. Together with SolarBusinessServices, SunWiz has developed a package to help identify opportune targets for commercial PV in your neighbourhood.
This article first appeared in Solar Australia, a quarterly magazine that covers important developments in the Australian solar energy industry, provides updates on new technology, project and policy developments. The publishers of Solar Australia – Great Southern Press – have been publishing EcoGeneration, Australia’s largest energy industry magazine for many years.