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Green Solar Technologies is a Scam

August 16, 2018August 16, 2018
by John Cromer, instructor

Green Solar Technologies is a Scam

Note: this is an outline I intended to publish much later. However, I was recently contacted by a Green Solar Technologies “customer” requesting help because they ARE being threatened with a $10k lawsuit for failure to proceed with their solar contract. My intent in publishing this rough copy is to allow potential GST customers information in considering doing business with this company.

Part I

“Solar is really simple… so why not harness it to create your own power? It almost always make you money in the long run, if not in the short run” – Edward Harner, COO Green Solar Technologies. 100.7 The Point Interview. 2018. A Friday Afternoon.

[sound clip]

In late October of 2017, I got a phone call from Green Solar Technologies (GST) asking if I wanted to install solar for an attractive amount of money. I told them I did not do installs in Mississippi, as I was not a registered contractor. But they told me they were a registered contractor, that they handled the sales, that the customers were already under contract and had long term financing. I confirmed they were a state licensed contractor and they confirmed I had the NABCEP certification necessary to sign-off on projects under the TVA buy-all, sell-all program. I agreed to evaluate their job sites for technical feasibility and help them find local installers.

[GST contractor registration Mississippi]

Actually, I thought that at what they were paying, I could make a side business out of referring local projects to my NABCEP continuing education students, as many of my students are located in “under developed” solar markets, which GST seems to be targeting. I proposed taking 10% off the top of the contract and shooting off a few emails to my installer network, and I received positive responses from my installer network. Clearly, there was nothing wrong with GST’s labor budget. I also called one of my early graduates, a seasoned pro in a well developed market, to ask what they thought of the GST business model.

“They have a lot of money”

It’s site evaluation day. I love the fact that I am getting paid for a site evaluation. Actually, in my course programs, I recommend charging for site evaluations as a best practice – and I am being paid for a site evaluation! Solar design is woefully ignored in this turnkey industry. It reminds me of the Netflix show Grand Designs – a little bit of solar planning can result in a stunning projects for a fraction of project cost. But my role today is simply to evaluate a “net metered” solar array. Snap a few photos of the roof and electric service panel and gather the information necessary for a system design and project permitting. The odd thing is that net-metering in MS is the opposite of what most USA customers would think: it refers to instantaneous purchase at avoided cost. This is often a worse economic deal than TVA’s below retail buy-all sell-all program, but the customer insists they want to use the array during a blackout and only want “one bill”. The buy-all, sell-all program is explicitly two bills. OK, well the customer also air conditions his garage (keep in mind this is Mississippi), so let’s proceed with a net-metered connection. With the first time project bonus GST is paying me, I figure I can upgrade the client’s fire hazard electric service panel with a new generator interlock panel and leave him better prepared for a blackout. Being an “end of the distribution circuit, rural area” customer, he loses power 4x per year. Just to be safe that the customer changes his mind about net-metering, I file a TVA buy-all, sell-all application (a program which the TVA services manager later told me was written explicitly to discourage net-metering). After all, that was really what my NABCEP certification was useful for. Later, much later, and at a cost that I fully covered for the customer, he decided he did not in fact want a “net-metered” connection as originally sold but instead would move forward with the buy-all sell-all application I filed.

Green Solar Technologies Partners Up With Top Leading Banks To Offer Unique 20 Year Term Financing With Low Interest rate

“Homeowners should not have to pay thousands of dollars each month when they can pay as little as a few hundred dollars instead over a long term” says Nicki Zvik, president of Green Solar Technologies.The company was awarded the Foundation Finance Award for excellence in the financing of regional customer installations. Foundation Finance selected the organization as one of its elite partners for the fiscal quarter, citing the company’s ability to finance more customers than its peers. The sheer volume of financing, coupled with 5 star Yelp reviews, has catapulted Green Solar Technologies to the upper echelon of the rapidly growing market.

Unlike other solar panel companies, they do not shut the door on customers with bad or mediocre credit. They have partnered up with banks to offer loans to its customers through a standardized pace program. “This program is somewhat new but continues to grow every day because financing is crucial to the future of the solar panel industry,” says Nicki Zvik.

Besides good financing, the company is known for other highly rated attributes. The company installs solar panels to customers in many states – not just California. They now have offices in Orange County and Riverside. Each month they continue to expand their territories. They plan to add ten more locations by the end of 2016. The company works with only the leading solar panel manufacturers including Solarworld, Enphase, Solaredge and many others. Green Solar Technologies is definitely a company you want to check out today.”

The thing that struck me as odd about site evaluation day, was that another site evaluator showed up to site too. Green Solar Technologies’ project manager would later claim it was a full-time employee of GST, in fact, their “responsible managing employee” who was legally obligate to work full time for the company. But on that day, after he called somebody, he left.

I also had issues with my contract.

I asked the project manager for missing details such as corporate structure and progress payment schedules, as also to remove certain details specific to compensation disputes, contractor clauses which did not fit my particular project role as a non-contractor, as well as a request to settle disputes within the state that the business was actually being conducted within. I also asked them to remove other clauses which I cannot disclose. This got me connected with General Manager John Muscari, although his name is not listed on the incorporation documents with the State of California.

In fact, they never emailed back my signed contract and the name of their company was not specifically clear. While GST was referred to as Contractor throughout the contract, was I dealing with Green Solar Technologies Mississppi, Inc. – a state licensed contractor capable on bidding on project work? Or was I in contract with Green Solar Technologies Inc, a DBA out of California managed by Edward Harner? It seems that not signing business documents is a standard practice at GST.

Part II

“The pioneer of the nationwide model”

First off, let me just say that Mississippi has a dumpster fire of solar policy, but perhaps more than any other state in the country, it is entitled to it.

Did you know Mississippi has the first electrical cooperative in the country? I had no clue! The Corinth Experiement served as the pilot project to the Tennessee Valley Authority, and within a decade of the pilot, rural grid connections in Mississippi increased 600%. The end result is a network of 27 different fiefdoms within Mississippi, some having fewer than five customers per mile of distributed power line. Perhaps some consolidation is due. But just a true, anything you might think about grid operator revenue loss due to solar is of particular concern in this region. What would happen if they saw 80% of their customers drop offline within ten years? Essentially, the entire system would have to be replaced with solar micro-grids, which is where Community.Solar is heading as a company. At the same time, I think these facts entitle grid operators to having the worst consumer solar policy in the nation. The TVA, for example, despite being a regulated, publicly owned monopoly, only provides instantaneous PURPA buyback for net-metered solar arrays, at less than three cents per kilowatt hour. The TVA pay utility-scale solar developers more for congested, centralized solar power than they pay their own customers delivered to the point-of-use! In January 2018, when arguing with the TVA on why they should allow my net-metered GST customer to proceed with his net-metered solar interconnection, the TVA net-metered program manager told me they only had 35 net-metered solar arrays in the entire TVA! And despite telling the Mississippi Public Service Commission their TVA electric power cooperatives have net-metering procedures in place, they don’t! And the EPCs are allowed to charge solar discriminatory meter fees on top of the avoided cost buyback, and some do! And the southern part of the state is just slightly better! I thought utility monopolies were supposed to grant some consumer protections, but solar consumers get better rate options on deregulated markets such as Texas, where there are zero net-metering laws on the books!

“According to the U.S. Department of Energy, Mississippi’s residential electricity rates increased, on average, by 1.47 percent annually between 2006 and 2016.” A Consumer’s Guide to Solar Power, ATTORNEY GENERAL JIM HOOD STATE OF MISSISSIPPI Mississippi Attorney General’s Office Consumer Protection Division

Much of my next few months of Green Solar Technologies (GST) contract work was spent arguing with the TVA on why they really needed to get their net-metering policies in order. On the other hand, I was faced with an increasing number of GST customers asking me about project economics, like, right when I was getting out of my car. My NABCEP code of ethics obligates me to answer such questions truthfully, and uniformly, those customers would not proceed with their projects. I asked a colleague at a national solar finance company what they would consider to be a fair rate escalator for modeling solar power, as some GST customers mentioned a rate of 7% per year. My own models had shown that US electricity actually ticks a hair below inflation, which fits with our very low electric rates compared to other developed nations. He mentioned they do not fund contractors who model a rate escalator above 4%. Keep in mind most conservative solar economic models peg performance degradation at -½% per year. My first GST customer decided he did not like Mississippi net-metering so well afterall, and I paid to convert his array to the TVA below retail buy-all, sell-all program – essentially a guarantee his loan would be underwater, but he was sinking to the bottom of his bank account at that point, having failed to implement any of my recommended load shifting measures to manage his site electric use. GST did not appear to have any NABCEP PV Installers on staff, but as evidenced by their solar reviews profile, they were a SEIA member and similarly bound by a code of ethics. I found myself having to sandbag larger projects, as it was obvious GST was not providing accurate economic analysis to their customers. In fact, they were instructing me not to do so.

“It’s like a big family. I started here a year ago as an opener, and now I’m a six figure guy… nothing but net profit”

GST claims to have been started in 1987 but the first time that I can find co-founders Nikki’s Vic and Shay Zavar work together was in 2005, about the same time there now COO Edward Lai Harner was issued a CPA certificate from the state of California. Savar founded a contracting company called American Home Remodeling and zvick founded a separate contractor company called Y & Z Construction. it is true that a separate company called American Solar and Home Remodeling was founded in 1987 by Jerry Sergey Goldman, which also listed a DBA as American Solar Solutions. Perhaps more confusing, Y & Z Construction did not file Articles of Incorporation with the state until 2010, this time signed by Shay Yavor. Zvic and Yavor split the corporate titles, and issued to new company names: American Solar Solutions and Green Solar Technologies.

Slthough I have not found a record of any agreement between Goldman Victoria bar wear one party acquired the other’s company, firmly establishing green solar technologies timeline back to 1987 as they claim, I believe it is reasonable to assume some kind of relationship formal or informal was agreed upon by all parties at some point in time, based on a track record of similar Behavior by their respective company founders. In 1995 Terry John Madison Construction Corporation was cited for aiding and abetting unlicensed construction work in California, with Goldman as CEO/President. A similar penalty was issued against Goldman’s company remodelex in 2003. Y & Z construction was cited in 2007 for among other things, misleading, false, and deceptive advertising to induce contract. In 2013, a contractor filing by you’ve are listed yavar as a hundred percent owner of green Solar Technologies, but named Goldman as the responsible managing officer. later that year business documents were amended to list Goldman as a 20% owner of the company, Yavar as its secretary / treasurer, and Zvik as President.

Part III

The solar industry is like the grocery business, and that it is incredibly difficult to ramp up Nationwide expansion. Unlike say our neighbor to the South Mexico, who has a national electric company with a national net-metering policy in place, regulation of electricity pricing in the USA is left to each individual state. How each state divvies up its electric grid is a crap shoot. Some States team up with others to establish large are regulatory Frameworks, other states isolate themselves from the rest of the grid. Within those Frameworks each state can choose to open its Market to multiple competitors or Grant power companies a monopoly in a given region, and often you will find different policies for municipalities versus the rural regions outside the city. States may or may not regulate their contractors and electricians, and may have different regulations for residential versus commercial as well as investor-owned utilities or public Electric cooperatives. cities themselves may have different permit procedures and classifications independent of the grid operators. this Patchwork quilt has a historical basis in that we were the first country to develop the electric grid, with other countries coming later to the game to develop a more streamlined process.

Powerplants of all fuel types require a tremendous amount of start up capital to develop. It is not uncommon for a 30-year bond to be issued to spread out that Capital cost over a long period of time amongst a large general population, guaranteed to be recovered as a rider on your electric bill. Rooftop solar, a small power plant, is no exception. It is not well known that the 30% solar tax credit at the corporate level, is part of a larger more comprehensive tax credit called the energy investment tax credit. Note that renewables are not part of that title. when I work in oil before getting into solar, the refinery expansion Mega project I worked on received the energy investment tax credit, I’ll be at 10% rather than solar’s 30%. when the solar tax credit sun sets in 2022, the corporate tax credit does not phase out but rather drops down to that 10% level. Up until green Solar Technologies started sending leads my way, I thought of solar as a millionaires game. Our import tariffs policies cross partisan lines and date back to 2014. State and local incentives if available do result in a lower system cost to the system owner, but do have a subsidy effect of raising total project cost. Treating solar as something special can substantially raise development and permitting costs. But if the end user is getting a deal that’s too good to be true, the developer has little incentive to lower there project development fees. This creates an economy where only those who pay substantial federal taxes can participate in solar array ownership. It is not a Level Playing Field that can be enjoyed by all, which would require not only in elimination of all renewable subsidies, but also the end to a long-standing tradition that allows fossil-fuel based business models to profit while dumping large quantities of carbon emissions into the atmosphere for free.

A handful of solar Developers have tried to cross the Rockies from California, or Appalachians from the East Coast, and most have flamed out in spectacular fashion. SunEdison, Akeena Solar, American Solar Direct, Sungevity have all left customers uncertain of where they’re solar leases stand after bankruptcy proceedings. Many industry insiders thought SolarCity was on that path to until they were bailed out by rich uncle Tesla.

Still, the question of whether big solar Will trump small solar remains in play. As solar power world senior editor Kelsey Miss printer rights in her March 2018 article https://www.solarpowerworldonline.com/2018/03/online-selling-growing-pains-solar-installers/ Some smaller installation companies don’t have the resources to have an internet savvy employee work on search engine and social media optimization full-time. This has resulted in Nationwide sales companies filling that energysage is a market leader in that niche. In the article CEO Vikram Aggarwal said the site had about five million U.S. visitors in 2017, with that number expected to double this year.

Zvik hits the fan

Green Solar Technologies is a master of social media. Their current CEO Edward Harner made the news for writing Congress in support of solar import tariffs, stating that the solar energy industry Association and most solar installers were wrong to oppose the policy. Media savviness runs in the family it seems. His brother-in-law Patel is one of the four listed cofounders of Huffington Post / BuzzFeed along with Arianna Huffington and Stephen Bannon. my contract with them prevents me from disclosing their marketing methods, but internet searches easily reveal they are actively engaged in social media management.

Well they do not appear on solarpowerworld top 500 contractor list for 2017, they rank umber 3 on popular lead generation website solar reviews. Com where they jaw dropping 4. 83 out of 5 star rating. They are listed as a seia and ASCS member, but their name does not appear in those directories. They have an A+ rating with the Better Business Bureau 24 positive and five negative reviews. Similar results can be found on evaluation platform such as Yelp, glass door, and canoe kunuduru. They routinely post job openings for social media content writers and optimizers, as well as one for a legal assistant. They advertise themselves as the creator of the Nationwide solar Contracting model.

We are extremely excited about receiving this certification from SolarWorld,” said Edward Harner, COO at Green Solar Technologies. “Very few installers are able to meet the quality installation standards required by SolarWorld, and being awarded the Platinum Installer status is quite an honor. To have one of the biggest panel manufacturers in the world certify us should matter a great deal to our customers because it means that SolarWorld trusts us to be good brand ambassadors. We feel that we are aligned with SolarWorld in its efforts to provide the best product to customers; Green Solar’s product is the overall project experience, from customer engagement all the way to the actual installation of the solar,” Harner continued. “Ever since we began as a business, we’ve aligned with only the best equipment manufacturers. SolarWorld has always been our partner because it makes the best panels in the world and, almost as important, it makes its panels right here in the U.S. in Oregon. We just feel more confident with an American-made panel because we can trust in its quality-control standards,” Harner said.

“The solar industry has changed drastically in the past few years. There are more and more small mom-and-pop operations doing solar, and it’s very important for customers to do their due diligence on the installer. Some of these people have no experience installing solar; they’re just electricians!” Harner said. “We’ve been doing solar for a long time and have always required extensive training for all of our installers. We feel confident that we are the best solar installers in the country. Period.”

Solar

Unlocking Solar Financing

August 8, 2018August 8, 2018
by John Cromer, instructor

As NABCEP Installers, we know that many people want solar, but not everyone can afford to pay upfront. If you’re a small residential contractor like me, you may prefer to work with cash-only customers who can afford to pay upfront. But only targeting this market means that customers in need of financing will seek out higher-priced sales companies whom subcontract out the installation, meaning the installer will still be required to cove labor and balance-of-system costs and have less control over end-of-project payments. So how does solar financing actually work?

Home Equity Line of Credit – Currently 4.5% to 5.5%

One of the cheapest ways homeowners can finance solar is through a home-equity line of credit (HELOC). This will typically give the customer a ten year loan between 0.5% to 1.5% above prime. It takes about two weeks between the time the customer completes the loan application to the time the money is deposited into the customer bank account. At that point, the customer has the ability to spend the money as they wish. Having a strong customer relationship can ensure the project is adequately funded without straining the installation contractor’s finances, similar to a cash deal. This can result in a beneficial project structure for both the customer and the installer.

For example, my market (Mississippi) has pretty low electricity rates AND lacks net-metering. The only way to make the project economically beneficial is to provide extremely aggressive pricing, below $2/W before sales tax. But that also means I need to reduce my project risk. However, at such a low installation price point, it is easy to explain that the customer needs to cover the material costs upfront, plus some mobilization fees to cover the design and material receiving. The customer is usually happy with these terms, because it can be easily demonstrated to them that they are receiving incredible pricing. Likewise, having the customer do the legwork for a home equity loan does not increase my project cost. So long as the homeowner has equity in their home, the project can be structured similarly to a cash deal (at least from the installer perspective).

It should be pointed out that most solar customers want a 10 year payback (or less) on their solar projects. If you are selling at a 10 year simple payback, a 10 year HELOC will add interest fees to the project. This will cause the solar loan to be “upside down” in the sense that the loan payments will exceed the cost savings of the array over the during the duration of the loan. But most solar customers who qualify for HELOCs understand that while they may be increasing their monthly expenses, the solar array will eventually be paid off and result in long-term payback. And it would not be unfair to characterise the solar array as “paying off the loan” in the sense that the financial structure will substantially reduce the out-of-pocket expense of the homeowner. For example, I recently sold a project where the HELOC loan payments were $2500/year but resulted in $2000/year in electric savings. The customer was happy to spend $500 more per year for ten years, on a low-risk gambit which would result in $2000/year savings even after the loan is paid off, for a 12.5 year payback.

“Short Term” Unconventional Solar Lending – 4.9% – 29.9%

Unconventional lending, also ironically called subprime lending, is a loan which is issued ABOVE prime and does not meet traditional home lending guidelines. This can be an expensive loan, but it can also be a good option for customers with good credit whom do not have enough equity in their home for a HELOC. For example, a customer with good credit may have recently used a HELOC to upgrade their home, with the solar project being an afterthought. They may also be new home-buyer who simply does not have any equity in their home. So there are a number of home owners with good credit who simply do not have home equity, and these customers can be well-served by unconventional financing with loans similar to HELOCs. Because the loans do not involve the bank coordinating with the home title company, some solar installation companies prefer simply to deal with “solar financing companies” rather than use banks for conventional HELOC financing.

A “Short Term” Unconventional solar loan is similar to a commercial capital equipment loan, in that the term typically ranges between 3-7 years. Even if the interest rate is similar to a HELOC, the shorter loan term will result in a higher monthly payment and more “out-of-pocket” expense than a 10 year HELOC. At the same time, the shorter loan term means that less interest is paid. Referencing the previous example, a 7 year unconventionally financed array results in a similar payback to a 10 year HELOC for a customer with good credit (about 12-13 years, under a 10 year “simple payback”).

Short-term unconventional solar loans are also similar to HELOCs in the sense that the customer is given the money upfront. As such, we can structure the project payment terms to provide great pricing, provided that the customer trusts the installation contractor enough to provide a substantial upfront payment (which might be as high as 70% of the total project cost). Customers with bad credit can qualify for shorter-term unconventional solar lending, but the project will not be economic.

“Long Term” Unconventional Solar Lending – 4.9%/yr + 12.5% contract value (20 years)

Finally, we get to long-term solar loans. This kind of loan typically requires the installer to have $2MM in revenue and a couple years in business. On the other hand, the money is paid directly to the installer!

The conventional financing counterpart to this kind of loan is a long-term home mortgage, but unlike short-term unconventional loans, it carries a substantially higher premium. Long-term unconventional solar loans typically have a provision to allow the customer to pay down the loan without penalty within the first year or two of the loan-term. While shorter options are available, a 20 year loan term is common. The loan usually allows the customer to claim tax benefits of solar and not have it factored into the long-term price of the loan.

These loans add substantial cost to a solar project. Even if the interest rate is the same as a short-term loan, a longer term will substantially increase the total amount of interest paid. On top of that, the loan is riskier for the lender. As such, the lender charges an upfront fee which starts out at 12.5% in order to overcome that risk. So if I am installing solar at $2/W, a long-term loan will increase that starting cost to $2.25/W, before the 4.9% interest kicks in.

Still, customers may seek longer financing terms such that the array can “pay for itself” over the life of the loan term. In other words, the cash flow of the customer would remain positive for every year of the loan. However, customers should remember that this is not a guarantee. In many parts of the country, the 20 year price of electricity does not above the price of inflation, but rather, below it! While this price may not account for the true cost of electricity, being a function of political whim and being disrupted by distributed generation, it is not known how these factors will impact the value of solar to a customer. For example, the Tennessee Valley Authority only pays 2.5 cents for distributed generation outflow for a “net-metered” solar array. In the executive summary of its 2018 rate change report, it explicitly states the intent to reduce the value of distributed generation further, meaning regional cooperatives will be able to increased fixed meter fees rather than increase the metered electric rate. To get true “retail price” from the array, a residential solar customer in this market may be best served by going “off grid”.

In other words, if a solar customer is presented a long-term cash flow diagram which shows a 7% increase in the price of electricity, but the value of solar only increases at 1.5%, it effectively adds another 6.5% to the interest rate of the loan. In other words, while it is common for a short-term solar loan to be “upside down” over the loan term and still be beneficial to the customer over the long-term, potential solar owners should be advised that long-term solar financing can result in true “upside-down” economics if the solar model is too aggressive. Ultimately, long-term upside-down solar loans are bad for the solar industry.

My recommendation is that unconventional long-term solar financing only be used under ANY of the following conditions:

the price of metered electricity is well above the national average
long-term consumer protections for solar (such as near-retail price net-metering) are firmly established
the project includes a battery bank large enough to take the customer 100% off-grid (even if the customer remains grid-tied)

Regardless of solar policy, a conventionally-financed solar array under a long-term mortgage is usually a good deal!

Finally, if you’ve made it this far down the post, here is a list of solar finance companies to consider:

If you are work in the industry and liked this post, why not support my cause by registering for continuing education? I don’t get paid to write this stuff – your financial support is how I keep this solar content going!

Solar

Hopscotch: Stop Worrying and Love MLPE

August 4, 2018August 13, 2018
by John Cromer, instructor

Here is the summary!

Advantages:

1) Improved installation logistics on the ground and roof

2) Improved cable management when combined with U channel racking

3) Mounting the module BEFORE DC optimizer improves workmanship

The Hopscotch Process:

On the Ground:

a) Select a rail with a top U channel.

b) Pre-assemble the rail, rail splices, and grounding lugs.

c) Mark where the L-feet and module frames will land.

d) Make up your home run and lay-into the U channel.

e) Mount the DC optimizers on the other frame of THE NEXT MODULE OVER, with two optimizers under the last module at the end of the row.

f) Tie wrap the DC optimizer whips into the U channel on each side of the optimizer.

g) Lift the entire rail up in one piece.

On the Roof:

a) Attach the rail to the L-feet, square and level the rack, and complete your wiring.

b) Mount one module onto the rack.

c) Reach under the module to grab the module whips.

d) Plug the “tight whip” into the optimizer. There should be very little slack.

e) Wrap the “loose whip” around the “tight whip” to remove the slack.

f) Repeat.

If you’re a NABCEP solar installer, you are probably already engaged in a love-hate relationship with Module Level Panel Electronics (MLPE). MLPE has clear design and performance advantages to offer solar owners. But MLPE exponentially increases the cabling and electronic failure points on the roof. At the very least, MLPE means addition installation time. Under the worst case scenario, rodent-destroyed cables or otherwise faulty optimizers can result in numerous trips back to the job site which are not always supported by the manufacturer warranty.

There is no way to fully eliminate this risk, as individual panels are plugged into their adjacent neighbors during installation. Cable management techniques such as tie-wraps and cable clips have their shortcomings too. Even the best cable management system does not address the exposed length of cable between the module junction box and module frame, which will inevitably droop over time.

Every solar installer has their favorite cable management technique, and I’ve finally honed in on a MLPE-mounting technique I’d like to share.

Do the Hopscotch!

1). Select any racking system with an “open U” top channel. I like the Everest Cross-Rail system, but even Unistrut will do.

A U-shaped top channel assists easy cable management.

2) Everything except the L-foot attachments and module mounting is done on the ground. For example, you will fully assemble the solar rail and then lay the home-run cable into the U channel, before lifting up to the roof.

Pre-assemble the entire rail length on the ground (including rooftop home-run cable).

Liberal use of tie-wraps mitigates failure and vanishes exposed cable.

3) Measuring and marking the rail is critical for ground pre-assembly. With practice, much of this work can even be performed at the office before getting to the job site. The goal is identify where every single component, down to the zip tie, will land on the rail in order to avoid any conflicts up on the roof when mounting the modules. You want to mark the following:

• Module End Clip • L-foot attachments

• Module Edges • DC Optimizer Locations

• Module Mid Clip

4) The Hopscotch!

Traditional Method:

DC Optimizers are commonly located on the rail underneath the solar module, located to not interfere with the module edges or L-foot attachments. Before mounting the module, the optimizer is plugged in. Then the module is lowered in such a manner that the loose cable whips remain atop the optimizer and below the module. Combined with pre-assembly, this can result in a very “clean” looking installation. However, this process requires multiple hands to install, and cables remain loose underneath the array, which could be problematic down the road.

Traditionally, the optimizer is located under the module with awkward cable management to prevent drooping.

Hopscotch Method:

Locate the DC Optimizer underneath the next module over. This may sound like heresy. But consider the advantages of the next few installation steps.

5) Back on the ground, mount the optimizers on the rail and plug them into their next-door neighbors. Make liberal use tie-wraps, at least one on each side of the optimizer, with additional tie-wraps to keep any slack in the U-channel. Doubling up the cable-whips provides cheap insurance that the cable will remain in the rail over the life of the project.

6) Lift the entire rail assembly in one piece up to the roof. Attach the rail to the previously mounted L-feet and square, completing the rack installation. At this time, you will also want to finish wiring your transition box and home-run cable run down to the inverter.

7) BEFORE plugging the module to the optimizer, mount the module onto the rack. If you used the Hopscotch layout, you no longer need to juggle the module and optimizer connections, substantially improving the installation time of this process.

Hopscotching allows mounting the module BEFORE cable management.

8) Reach underneath the module and grab the loose module whips. Plug into the exposed optimizer whips. There should be almost no slack in the “tight” module whip. Wrap the “loose” module whip around the tight cable to eliminate any slack. Compared to the traditional method, you will be able to see the cable whips running underneath the module frames. But because there is no slack, the cable is secure and will not shift over time.

Wrap the 'Loose Whip' around the 'Tight Whip'

9) The final module will have two optimizers underneath. After “hopscotching” the second-to-last module, the final module is mounted in the traditional manner.

And that’s it! Through careful planning of every system component, ground-mount pre-assembly is utilized for a quick and clean installation on the roof. The additional planning time is more than made up for through reduced time spent on the roof, eliminating all sorts of project risks such as installer fatigue or unexpected rain (which can damage “unplugged and exposed” optimizer). Any misplaced optimizers can be easily adjusted AFTER mounting the module. Because you no longer have to fight MLPE mounting and cable management obstacles, you can finally learn to stop worrying and love your module-level panel electronics!

'Vanished' cable with hopscotched MLPE

Blog Author John Cromer is a NABCEP-certified solar installer, mechanical engineer, master electrician, and residential builder. He’s on a mission to convert Mississippi to 100% solar power. Because if a “bad solar policy, low electricity pricing” market like Mississippi can flip to solar, there will be no more excuses for carbon-heavy electricity and the rest of the USA will follow.

If you liked this post, why not support his mission by registering for The Glass-Slapper Guide to Solar Power for continuing education? The program meets 100% of NABCEP continuing education requirements and includes unlimited course access and updates.

Introduction

Killing me softly with soft cost

July 3, 2018July 3, 2018
by John Cromer, instructor

The main problem with residential solar is that there is a tremendous amount of what is called “soft cost” which are everything other than the direct cost associated with the project. So aside from the actual hardware and take home pay of the laborer, there is overhead, design, sales, supply chain mark-up, installer profit, a partridge and a pear tree, and in mainstream construction, this soft cost margin is around 30%. Solar residential soft costs are far above this figure. It may not be the installer’s fault. In Mississippi, I might design, procure, and install a solar project within seven days start-to-finish. The permit process can take months, with more time spent fighting grid operator obstruction than doing real work. This can create a market where a specialty installer must be used to navigate a time-consuming development cycle, and must charge a huge specialty margin in order to make enough money to simply get by. In other words, the profit made on a one week project might have to last the installation team for two weeks or more. It is no wonder these specialty contractors go out of business whenever there is a policy shift in the local solar market.

This soft cost drops dramatically at the utility-scale. But that does not mean that the direct costs of utility-scale projects are substantially less than residential. The soft cost of a rooftop solar project can be brought down substantially through a well-planned design process when there is not substantial obstruction from the local permit authority.

Subsidies increase soft cost, yet have a benefit to the project owners by lowering their out-of-pocket expense. Not always – the import tariffs have substantially eliminated much of the tax credit benefit while making solar more difficult to afford for lower income households. Supposedly, the subsidies will vanish with the tax credits and permit offices will realize the bulk majority of residential projects are smaller than the minimum amount of residential electric service mandated by national electric code.

But to accomplish solar without reliance on subsidies of any kind, we will have to be smarter about our solar design to reduce those soft costs, which is what mainstream construction

does on a regular basis. That discipline has not yet made it into the solar industry. More likely, building construction experts know little about solar and need to know where to find someone

who knows about solar design, and solar installers are focused on low-hanging fruit retrofit markets rather than incorporating their practices into a larger general construction practice. This is where a smaller solar designer might find an opportunity, working with local architects and engineers to incorporate solar into existing design and construction firms.

Introduction

Solar Timeline Part II – Tax Credits + Buyback

July 1, 2018July 1, 2018
by John Cromer, instructor

In 1978, the Public Utility Regulatory Policy Act (PURPA) was passed to clean the electric grid with some low-hanging fruit. On the one hand,m acid rain wabs burning leaves off of trees and choking out fish in the streams. On the other, the energy crisis of 1973 which had quadrupled the price of crude oil was fresh on the public’s mind. Manufacturers who needed more power for their manufacturing processes than what the utility could provide them from the grid were generating their own power onsite. But to achieve a stable power supply, the manufacturers were generating more power than they could consume. These were traditional fossil fuel generators, but even gas generators produce fewer emmissions in regions primarily powered by coal. These “qualifying facilities” wanted the ability to sell their surplus power back to the electric grid, but the electric utilities claimed it was not their role to purchase backfed power from their own customers.

PURPA was a compromise between manufacturers and grid operators, requiring the utility to allow generator interconnections and purchase the backfed power so long as the facilities were small (defined as less than 80 megawatts) and generated by power sources cleaner than what the utility would otherwise provide. The compromise was that the forced purchase rate would be set at avoided cost – essentially the raw material cost the utility pays to buy the coal before shoveling it into the powerplant, less an administrative fee. So PURPA established a bare minimum purchase price that the power companies should find acceptable to buy back clean power from their customers. But keep in mind that the definition of a small and the definition of clean were both far behind that of a residential solar array today. Still, this was not a policy intended for individuals to offset their entire electric bill, but rather more of a convenient arrangement between power companies and large manufacturers to clean the grid without impacting the cost of electricity.

The debate over fair buyback rates between grid operators and their customers still continues to this day, with PURPA being the starting point over what is fair compensation for backfed clean power. Even at avoided cost buyback, PURPA is under attack. There are states like Hawaii which have brought so much solar online that PURPA does not really apply anymore. Homeowners in Hawaii are allowed to interconnect to the grid, but must program their solar arrays to throttle back their output rather than push surplus production onto the grid. This is because enough backfed power appear as a power outage to to “dumb” infrastructure – as the electricity is flowing the wrong direction! Also, in some regions the avoided cost electricity rate is high enough to stimulate utility-scale solar development, which upsets traditional power generation balance sheets due to the first-in-line status given to backfed renewables. A powerplant that was designed for 24/7 operation may find itself without a buyer for its mid-day electricity. These fossil fuel owners may claim they need to increase the cost of electricity to make up for the shortfall. Whether higher night time rates translates into effective increased consumer cost is yet another factor worth consideration, as daytime electricity is traditionally considered to be “peak”. Combining these scenarios, consumer solar advocates may find themselves on the opposite side of utility-scale solar developers, both competing for the limited capacity of backfed power that the grid can handle without upgrade. Even in a world of 100% renewable energy, there will still be debate between “consumer owned” and “Big Energy” stakeholders.

It may come as a surprise to learn that George W. Bush deserves special recognition for contributions to the solar industry. His administration is responsible for reinstating Carter’s solar tax credit in 2005 and uncapping the tax credit as part of TARP in 2008. Additionally, his Energy Policy Act of 2005 required all states to develop develop a net-metering policy, which defines how customer-owned solar consumers are compensated for their outflow at rates above and beyond PURPA. Typically, net-metered solar is constrained to less than five megawatts at the commercial scale or less than 25 kilowatts at the residential level but it varies by each state. Additionally, commerce clause restrictions on Federal power make the Federal net-metering mandate act more like a request rather than a mandate; some states have chosen not to develop net-metering policies without punishment. Perhaps more confusing is the compensation rate – in other countires, a net-metering policy is more akin to PURPA rather than compensation above and beyond avoided-cost.

The spirit of USA-style net-metering is that you are allowed to offset your energy use with what you push back onto the grid, provided that you do not produce more than you consume at the end of a billing cycle, which may be a month, a year, or even unlimited. Traditionally, net-metering policy is set by each state’s public utility commission. Before the era of “smart meters”, the analog meter would simply “spin backwards” when outflowing electricity to the grid – essentially an unlimited net-metering benefit. Digital meters can track the inflow and outflow independently of each other, meaning the instant a solar array begins pushing electricity onto the grid, the value of that electricity can be worth as little as 15% of average retail pricing. Net-metering may increase that value up to as much as a 1-to-1 match for inflow verses outflow. So because net-metering policy is left to the states, the economic value of solar can be completely different in Kansas City, Missouri verses Kansas City, Kansas.This brings a localization to solar design where one must be an expert in regional policy.

Obama extended and expanded W’s solar programs. The solar tax credit was extended in 2015 (as part of a bi-partisan energy bill which punted on cap-and-trade and expanded fossil fuel development domestically and abroad). The tax credit is 30% of total system cost through 2019, 26% until 2021, 22% in 2021 (a great year to go off-grid), and then the residential credit phases out while the commercial tax credit demains at 10%. It may seem odd that corporations get an added tax benefit above residential consumers, but technically, the commercial tax credit is for energy projects – other forms of energy projects (not necessarily renewable) may also qualify for the 10% Energy Investment Tax Credit. The oil refinery expansion project I was working on while researching the solar industry back in 2006 was a product of the ITC.

One item many do not realize is that if you have already installed a solar array which qualified for the tax credit, you may expand the solar array (such as adding solar-charged batteries or more panels) and have the expansion qualify for the tax credit.

Introduction

A Solar Timeline Part I

June 30, 2018June 30, 2018
by John Cromer, instructor

Let’s start with a timeline of human energy use which helps paint the solar industry in a broader perspective. There’s a lot of volatility in in solar, an industry whose individual segments may grow or shrink based on energy policy. For example, the utility-scale market was expected to shrink back in 2017 when the tax credit was originally expected to expire, resulting in numerous projects coming online in 2016. Instead, the utility market continues to grow as the tax credit was extended. Although presently, import tariff decisions are dampening growth rates. Solar is energy and the industry is be driven by energy politics as much as by plain, old-fashioned value. But as we’ll see, solar energy policy actually goes back a very long time, perhaps longer than what we can fully appreciate in a human lifetime. At the same time, our industry policies do not have much to do with environmental politics as you may think.

Solar design is the most lacking skill in the entire industry, in my opinion. There’s a number of reasons for this, some of which have to do with subsidies. United States solar subsidies have been focused on driving projects to market as quickly as possible. When incorporated into a rooftop, solar knowledge is focused on retrofitting, with few people understanding the required scope, resulting in one person wearing many hats on the entire project. While an individual may be very proficient at what they do, a team follows a design review process with specialty division of labor, which can reduce project cost as demonstrated by mainstream building design and construction best practices.

So what’s happened in years past is someone like me, a solar specialist, would manage all aspects of the project: sales, design, procurement, installation, commissioning, and maintenance. But that’s not how mainstream construction manages the project development cycle, and if we want to reap the benefits of transitioning solar into the mainstream, we need to get our design work up to snuff. We need to make it so general contractors can can execute a solar project, along with the rest of the building and electrical scope. This program is focused on those advanced issues, as well as revisiting the basics.

Some background on myself: I’m a mechanical engineer by degree. I have a master electrician certificate in Mississippi and have served as a master electrician of record for multi-million dollar commercial construction company. I’m also a NABCEP PV installer – what that means we’ll get to later. I’ve taught solar since 2009, and overtime my content has expanded into batteries and policy. Chasing solar subsidies brought me to Mississippi, and when they vanished, I remained to refine my trade, to identify how solar projects might come to market independent of political whimsy. I firmly believe our electric grid will transition to 100% solar, with other forms of energy providing storage and back-up capability. I’m not a fan of “energy baskets”, believing solar is the clear winner in this horse race. Back in 2008, I quit my oil industry job to help advance that belief.

Back to the timeline, what did people do without solar power?

Hopefully that becomes a tough world to imagine, but actually solar bridges the time span from prehistoric cavemen up until today. During the industrial revolution, we had oil lamps, but what did we do before then? In cave dwelling times, that oil lamp equivalent would be sticking a stick into some animal fat to making a torch, or eventually, putting the same biofuel into a well with a wick, burning it for light. In addition to wood fire and candle wax, the genie inside Aladdin’s lamp was an oil vessel to refill those floating wicks. What we think as a kerosene lamp didn’t originally burn kerosene, but rather biofuel, but even that did not come to market until right before the founding of the United States. Fossil-fuel-based kerosene didn’t really come to market until right before the Civil War era, after the discovery of massive quantities of crude oil. Like today, coal was difficult and expensive to gassify.

But even before coal was burned to create steam to generate electricity, we had solar rules and regulations on the books. So if energy subsidies of all types cause you to pull your hair out of your head, even if you traveled back to 600 AD you would find laws on the books regarding a human’s right to access sunlight. Solar access property rights might sound stereotypically like a California burdensome regulation, but imagine how you would feel, living in a cave, if if your neighbor built a mud hut in front of your cave window. You’d be pretty upset with them because the sun was your main source of residential lighting. Going back into 600 AD Justinian Code, we find laws on the books preventing you from casting a shadow onto your neighbor’s property.

Expansion into the new world was funded out of a quest for burning timber of Virginia’s forests as much as a desire of the pilgrims for religious free expression. Europe was running out of wood, and had passed laws protecting the King’s forest. The major industry in colonial New England was tree-felling, chopping down timber to ship back to Europe. It was only natural to build boats out of the timber, creating an economy of experienced sailors well-familiar with ship building. Before the benefits of fossil fuel were known, our world was powered by “surface carbon” with our energy portfolio coming from wood burning. Our first energy regulations in the United States were based on the ability to cut down trees. Our first building codes were bans on fireplaces inside the city when constructed from wood.

The “wild west” style oil lamp was invented right around the founding of the United States, a relatively new invention less than 300 years old. The lamp could burn oil derived from animal fat or vegetables, so you could imagine in the 1780s when this new lamp technology came to market, it created an insatiable appetite for whale oil with New England being uniquely positioned to exploit. So the invention of the oil lamp led to the whaling industry, which today might be called “free-range biofuel”.

We had coal, but the ability to extract gas from coal (called coal gasification, the same process used in generating “clean beautiful coal” today) was expensive. The mainstream kerosene lamp market originally burned gas derived from crude oil, rather than coal-based kerosene and that didn’t get off the ground until the 1850s. So with the whaling industry coming online in the 1780s and 1790s, and petroleum not being discovered until the late 1850s, society faced a problem as the demand for whales outstripped the supply.

In fact, by the 1830s, society was headed towards yet another pre-fossil fuel energy crisis and had begun to revert back towards other animal and plant-based biofuels, less expensive yet also less clean, healthy, and safe than whale oil. America’s energy costs were on the rise and

Entrepreneurs were using cottonseed (whose availability was accelerated by slavery, railroads, and the cotton gin) as well as pine-tree derived turpentine to produce ethanol. In other words, the Southern United States was positioned to become a biofuel powerhouse just as the debate over slavery was leading it towards Civil War.

Ethanol was cheaper than coal-based kerosene and whale oil had been essentially priced off the market. But a major discovery of crude oil in Pennsylvania brought a new technology to market: crude-oil-based kerosene, which at its discovery, leveraged the existing oil lamp research and development to immediately become just slightly more expensive than ethanol. Ethanol was problematic as it produced poor light, was prone to explosion, and left dirty suit inside the homes of its users impacting their health. When the Civil War officially started, the IRS was founded to raise money for the war effort. It’s very first tax was a 300% tax on alcohol, which was not only a vice tax but also had the effect of pricing ethanol off the market. In other words, the very first tax of the IRS was an energy tax that promoted more expensive fossil fuel over existing biofuels, in the interest of public health, safety, and welfare.

Maybe this is not the most tactful way to begin an introduction to solar, but the point is that no matter how far back you go in history, you will find politics shaping our energy markets in one way or another.

I did not start out being a solar advocate. My early career was in oil and gas, being an engineer from Houston, TX. In college, I was not part of any solar car team.I was more of a computer nerd and worked in computer repair. Moving away from politics, there’s a missed overlap between the computer sector and the solar sector that gets lost in the weed of our polarizing debate over accounting for the full lifecycle cost of our energy consumption,

In the 1940s, vacuum tubes were helping us create newfangled electronic calculators. Photovoltaics were an electrical hobby dating back into the 1800s, without much use, but in the process of developing silicon transistors to replace vacuum tubes, it was discovered silicon was a good photovoltaic material. In the 1950’s, Bell Labs created a silicon cell to generate electricity to power remote applications whose logistical costs outweighed the atrocious refining costs of solar power (even today, an expensive off-grid home might be more economic than building the grid out to the point of use).

Silicon is a semi-conductor, meaning that it can conduct electricity when energized. All semi-conductors are photovoltaic, meaning that in pure enough form, light particles from the sun, called photons, can cause it to convert energy from the sun into conductive electricity. So for the same reason that silicon computer chips could replace vacuum tubes, that silicon can also produce electricity. Albert Einstein published a paper describing this “photovoltaic effect” phenomenon in 1905, which would later win him the Nobel prize. But these costs to refine semi-conductive material to the point where there photovoltaic properties became useful remained uneconomic for decades thereafter.

In the 1960s, NASA and its military predecessors used solar power to develop extra-terrestrial applications of silicon technology. It should be noted that solar power was considered reliable enough to power satellites, where maintenance would be quite expensive.

Regardless, imagine yourself a silicon refiner in the 1970s with two options: manufacture silicon to make computers or spend even more energy cost to make photovoltaic silicon to compete with coal, oil, nuclear, hydro, wood, and all other forms of electric power generation. Obviously computers are the more profitable application, and the electronics industry underwent exponential growth in the 70s, 80s, and 90s. And that’s exactly the decision silicon refiners made in the the first 50 years of shovel-ready solar power. Solar technology was only used for the most remote applications and any other silicon coming to market went into consumer electronics.

But by the the end of the 1990s, exponential growth in the semi-conductor industry crashed. Electronics were getting smaller. New technologies were replacing old technologies rather than creating new applications. So the same silicon refiner says, “Look we’ve enjoyed decades of

growth with computers, but now we need to find new markets. There’s far more silicon in a solar panel than in the electronics it could power, so how much money would it take to scale up the industry to the point this solar power stuff actually becomes a mainstream power technology?”

In fact, there was substantial investment in silicon refining in the early 2000s and this production capacity began to come online by the end of the decade. The oil and gas company I worked for helped build some of these early dedicated-solar silicon refineries between 2003-2006, and suddenly in 2007, the price of the solar panel began to drop – a trend which continues today.

The drop has been so precipitous that rather than embracing free trade, USA Republicans and Democrats have thrown up substantial protectionist import tariffs to prevent cheap solar from coming to market, policies which largely set environmental considerations aside. All this to say that what’s driving the solar market today has less to do with “green energy” and instead, the main motivation of solar growth is more closely related to the fact that silicon refiners are supporting a new market for their silicon beyond computers.

There’s plenty of silicon dioxide in the world. It’s the most abundant mineral in the Earth’s crust, which makes silicon the second most abundant element we can affordably access today.

Safety

Solar in a Tornado

May 14, 2018June 30, 2018
by John Cromer, instructor

Photos courtesy of and all rights retained by Mississippi Solar

Exposure categories, racking strategy aside, the added weight of the solar array had a ballast effect on those attachments, keeping the entire roof on the frame.

But let’s see how the other side of the roof did.

If you look closely, you will see how the metal roof tore the purlins off along with the roofing cladding. Longer roof life can be a real selling point to a customer who is right on the edge of a purchase whether it be in {{State}} or Mississippi.

Policy

Understanding the Mississippi Electric Grid

February 22, 2018June 30, 2018
by John Cromer, instructor

All of Mississippi has a regulated grid, full of electric cooperatives which act as purchasing agents for their customers. There is no customer choice. In fact, all of Mississippi consists of electric cooperatives.

Mississippi is supplied by TVA, Entergy, and Mississippi Power – but additional power is wheeled in through additional coop purchasing, excluding the TVA.

The non-TVA region consists of Mississippi Power, Entergy, and Cooperative Energy (a coop aggregator). The result is that electric policy is completely different in TVA + non-TVA areas of the grid.

SolarCoin

SolarCoin Directory 2018Q1

February 20, 2018June 30, 2018
by John Cromer, instructor

You have found an informal

SolarCoin Directory 2018

of organizations participating

in the SolarCoin ecosystem.

Community Solar

Is there a point to Solarcoin?

January 18, 2018January 18, 2018
by John Cromer, instructor

When I bought SolarCoin at $0.20, I couldn’t tell if I overpaid or what actually happened. I had to use BitRex and Coinomi and SolarCoin and something else… all with passwords of lengths I’ve never thought before. Some of the wallets I used are no longer available for download so… it’s a process to get SolarCoin into a SolarCoin wallet without being a solar owner.

If you have need for a Block Chain, it’s a good platform to consider. As a continuing education company, we use the SolarCoin BlockChain to record Certificates of Completion. Our public signature is secured, while allowing third parties to verify our attendees without the need of a login.

Yesterday I put up a Google Form which offered free SolarCoin registration for anyone with a solar array. As a result, I met two solar array owners in Africa, both whom own <1kW solar arrays powering their off-grid AGM rigs. One in Benin, the other in Bloemfontein. Now if you want to buy Renewable Energy Credits from Africa, we can do that.

SolarCoin counts production, a problem in the United States as well as developing countries. Any use for SolarCoin creates an incentive to get this micro-generation data counted.

Batteries

Demand Charges open up Commercial Solar Across USA

November 28, 2017
by John Cromer, instructor

Joyce McLaren of NREL has compiled useful data on utility kW demand charges, previously untracked by the EIA. The raw data can be combed through here but I thought I might quickly summarize the main points of NREL’s white paper and Joyce’s September 19th powerpoint.

$15/kW is about where batteries overtake battery-less solar.
70% of commercial load is on demand charges

And as one of our recent blog posts documents, in markets with low energy costs and high demand charges, battery-based solar offers quickest economic payback.

Batteries

Why solar batteries are great for Missouri (and other…

November 15, 2017November 17, 2017
by John Cromer, instructor

If you install solar unfriendly state, you may think yourself limited to a small number of luxury-oriented residential customers willing to prioritize environmental values above financial reward. But the battery market is changing everything we know about solar economics, forcing us to re-examine our design philosophy and project strategies.

I recently sent out the following marketing email to announce the registration of my Glass-Slapper program for NABCEP recertification / engineer + architect continuing education: “[YOUR STATE] is a great market for batteries and last year the USA battery industry grew over 275%. Is [YOUR COMPANY] prepared for this growth?…” To which I received the following response from a NABCEP-certified PV Installation Professional:

“Just curious, why do you think MO is a great market for batteries? The cost of power is relatively low and we don’t have time of use rate schedules.”

This forced me to put my money where my mouth is. I feel that batteries offer the most economic solar array in MOST of the United States, but what do the actual economics say?

Let’s take a look at the worst solar markets in the United States. NREL’s PV Project provides us with state photovoltaic installation data and the EIA provides us with electricity consumption data by state. Dividing one over the other will give us a decent ranking of solar by state market penetration. I’ve grouped the states into “good”, “ok”, and “bad” categories.

If you live in Massachusetts, New Jersey, California, or Arizona, congratulations, you live in a solar-friendly state! Nevada, Connecticut, Delaware, New Mexico, and Vermont are just okay, and all other states lag much further behind the solar adoption curve. For example, I would rank Missouri at #18 of all 50 states, but that doesn’t mean it has a good solar market. But rather than complain, let’s ask ourselves, where is the low hanging fruit in these sluggish solar markets?

First, let’s see what solar economics would look like for a residential customer under Ameren Missouri’s electric rate structures. Ameren charges about 12 cents per kwh in the peak summer months and 8 cents per kwh for the rest of the year. Performing a quick PVWatts calculation using conservative numbers, we determine that a $3/W battery-less residential solar array has simple payback of 16 years – no wonder our NABCEP PV Installer is frustrated with the local market!

Next, let’s explore Ameren’s default rate structure for general electric service, typical for small and mid-sized businesses. In this model, we take the same 8kW solar array and add a 25kW, 25kwh battery bank at $1/W. Without storage, this solar array would generate at around 10 cents per kilowatt hour, providing less of a return for our client. But Ameren is using a “block” rate structure, with the kwh price of electricity increasing as kW demand rises. It looks something like this:

Even though Ameren’s demand rate is relatively low, the true demand cost is hidden by this structure. By lowering the demand of the building, we push more electricity consumption into the cheaper rate, so that the client purchases more electricity at 5 cents vs. 10 cents. The solar payback drops from 16 years to 11 years – a 30% improvement in project economics!

Finally, let’s look at even larger commercial customers on a primary electric service. Ameren’s primary rate structure is a typical demand-based rate structure with high demand charges and low energy costs. In this case, we want a solar array that is just large enough to fill the batteries (which qualifies the batteries for the 30% tax credit). You may even consider not filling the batteries all the way up with renewables. The tax credit is taken proportionally, provided that a minimum charge of 80% renewable is met. So charging the batteries with 90% renewable would only devalue the tax credit on the batteries by 3%.

Now we combine a 16kW solar array with a 80kwh battery… 2x the size of the previous example. However, demand management is even more likely, because the customer would be using roughly 10x the energy. As we learn in the battery portion of class, the deeper you reduce a building’s demand, the more storage capacity is necessary, reaching a point of diminishing returns. Because a smaller system is more likely to be successful, a strategy would be to install a smaller system to demonstrate functionality ahead of a larger expansion.

The math doesn’t lie. A solar battery on a demand-rate structure in on Ameren’s grid in Missouri can reduce system payback by 60% as compared to a residential “energy only” rate structure. This is a phenomenal milestone in the solar + storage industry, as only a few years back, residents in solar-friendly Arizona were involved in a lawsuit to prevent mandatory demand rate structures from coming to market. Furthermore, many large corporations do not have adequate rooftops for large solar arrays. But a solar “peaker” array can have a much smaller footprint, as the solar array need only be large enough to charge the batteries.

So if you are a Glass-Slapper in a less-developed solar market, take a fresh look at your utility demand-rate structures. You (and your utility) may be surprised to learn they can offer the best solar economics in your area.

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