Can the 25 year warranty get better?

What’s happening with solar panel/module warranties? Can they get even better?

There are so many high quality solar modules/panels to choose from today that it’s hard to go wrong in your selection.  The gold standard for warranties is a 25 year power warranty broken out in year 10 and the year 25, or a linear power warranty guaranteeing  power percentages over 25 years.  On top of these power warranties  are workmanship warranties typically for 5 years.  Now we are seeing module/panel manufacturers upping the warranty ante.  As an example, Chinese solar module manufacturer Jinko Solar Holding Company has their Quantum 1 module workmanship warranty listed now for 10 years and the power performance warranty is 90% performance for the first 12 years and 80% performance for the remaining 13 years.  Canadian Solar, REC, and First Solar have all made similar extensions to their warranties.  I expect other solar equipment manufacturers to follow suit.

 

These long and extended mechanical warranties and power warranties are a clear demonstration of the proven performance of the solar equipment and the manufacturers’ confidence in their robust power producing longevity.  There are few products, and especially those that are electrical, where the purchaser/consumer  is backed so solidly by the maker of the product.  One more reason why solar is a good investment.

Skyward’s B. Freeman featured in Forbes

Recently, Bruce Freeman of Skyward Solar Power Company was a feature blogger on Peter J Riley’s site at Forbes. (Thanks, Peter)  His commentary on “Should Solar Stand on Its Own in the 21st Century” was featured on an additional 15 websites. View the original at:  http://www.forbes.com/sites/peterjreilly/2011/11/01/should-solar-stand-on-its-own-in-the-21st-century/

Should Solar Stand on Its Own in the 21st Century

Solar has taken a hit lately in the media, and the opinion of some newspaper columnists is that solar technology deserves a stern dressing down.  The negative stories written about Solyndra have put a smear on the entire solar industry.  Solar, before the Solyndra debacle, enjoyed extremely positive press for its reliable and clean energy generation delivered amazingly by the sun every day.  Solar enjoyed a rebirth at exactly the right time as a strong growth industry that provides good quality jobs and careers across the country.  But then Solyndra collapsed and the solar goodwill suddenly was in flames.  The columnists could have chosen to reveal that Solyndra, through no fault of its own, competed in a market  that was about to be flooded  by Chinese solar manufacturers, and we all know what that means – equipment becomes a commodity and  commodity product pricing forces a rapid price decline.

In the solar module market equipment is priced by the watt.  In 2009, when the Chinese made modules began flooding the market, Solyndra priced at over six dollars per watt for itsmodules. That’s expensive.  They competed against modules being sold as low as almost two dollars per watt at that time. Solyndra’s challenge was to take their highly innovative and excellent technology and reduce its very expensive manufacturing costs to a price per watt that competed against the Chinese.  It couldn’t be done.  Their target price was  to be under two dollars per watt before 2012. Even at this price per watt, Solyndra was still not competitive because the pricing of competing technologies continued to fall.  Unfortunately, it appears there was mismanagement within Solyndra, but mismanagement does not over ride the market conditions in which they were forced to work.

This brings me to the columnists’ outrage of the $535 million government loan guarantee Solyndra received two years ago.  Columnists and commentators have suggested that solar should not be propped up and that it should stand on its own merits.  Well, how about all the other industries and Fortune 500 companies that receive government hand outs?  In the early 1900s oil subsidies found their way into special government assistance and have never left.  There are so many government subsidies extended to the oil industry you need to be a forensic accountant to be able to pull them out and understand them.  A short list would be:  tax incentives, tax credits, special deductions, exemptions, grants, loans, special below market royalties, R&D, and foreign competition protections. In one year alone, oil and gas will receive over $3.5 billion in subsidies and special treatment.

The agriculture industry benefits from government subsidies that  are older still, dating back to the 1800s. This sector, for decades, receives as much as a whopping $30 billion every year not to mention $5 billion dollars per year in cash.  Timber, another government subsidies old timer, is also in the billions of dollars per year.  Even our biggest department store received $1 billion in special government favors.  Coal, oil, gas, nuclear and ethanol receive over $12 billion a year in special government assistance.  I would have expected that by the 21st century these industries wouldn’t need to be propped up by special government help.  By comparison, what solar gets is a pittance.  Run your finger down the Fortune 500 list and see for yourself who either always gets special government favors or who has at some time received government help.  It’s a long list of hand outs received.

We, Americans, are very quick to dismiss what other countries achieve especially when it comes to science.  This ivory tower position today shows we have our heads firmly stuck in the sand.  While Europe, China, and Japan are competing against each other in the big race to transform their energy sectors, the USA may not even qualify for the event.  Europe is on track to produce 20% of its energy from renewable sources and be carbon free by 2050 under its 20-20-20 plan – reduce 20% of its greenhouse emissions, reduce energy consumption by 20% and increase renewable energy by 20%.  The USA, by comparison, is all about drill, baby drill, and dig, baby, dig. The USA’s backward attitude will guarantee that we will lose technological and production leadership to Europe, China, and Japan.  China is easily the world’s leader in investing in renewable energy.  Last year China invested $54 billion in private  sector investments alone in renewable energy.  Germany invested $41 billion in private sector renewable energy investments.  The USA’s backward thinking has held us back and it will be one more race for which we fail to qualify.  Solar was once the technological and manufacturing domain of the USA.

Without question solar technology has proved itself.  Solar reliably produces power and the systems are engineered to last for decades.  The power produced is clean and the systems require very little in operation and maintenance in comparison to most other forms of energy generation.  The USA has an excellent solar resource that should be exploited to the maximum.  Solar contributes to job growth, energy independence, and environmental sustainability.  Solar has earned its place in the mix of renewable energy generation.  The political  hostility against the development of solar must stop.  Solar has earned a national commitment to its growth. Today is the time for the USA to ramp up for the energy race and be the leader we should be.

Breaking news: All Americans love the sun!

From a letter sent to Bruce Freeman, President Skyward Solar Power, from Michael Rader SEIA.

Given the weather around most of the country (and the East Coast in particular), you may not be surprised to learn that solar energy is still pretty popular among Americans.

Just how popular may surprise you.

For the fourth consecutive year, the annual SCHOTT Solar Barometer survey showed that overwhelming majorities of Americans support greater development of solar energy in the United States. The key results from the poll are below:

•    Nine out of ten respondents (89%) think it is important for the U.S. to develop and use solar power.

•    Solar energy is non-partisan: Independents (90%), Republicans (80%) and Democrats (94%) all agree that developing solar energy is important.

•    Eight out of ten Americans (82%) believe that solar energy should receive the same level and type of support as fossil fuel industries have enjoyed for decades, and that the government should support solar manufacturing.

•    A plurality (39%) would choose to prioritize solar if they were in charge of U.S. energy policy, more than natural gas (21%), wind (12%), nuclear (9%) or coal (3%).

•    More than half of Americans (51%) would be more likely to buy a product if they knew it was made using solar energy.

Let’s be clear: it takes more than some dreary weather and a little early snow to make the sun this popular. These survey results show that Americans believe in the power of solar to provide a meaningful shift towards a clean energy future.

The U.S. is on the fast-track to becoming the largest solar energy market in the world with thousands of new jobs, tremendous potential energy savings for consumers and billions of dollars in new private investment. As you’ve surely seen, there has been plenty of consternation in the 24-hour news cycle about the fate of renewable energy – these results show that Americans aren’t buying it.

Given these numbers – which are consistent with the polls conducted the past three years – you might wonder why you don’t see more pro-solar policies coming out of Washington.

The short answer is: on solar energy issues, the public is way ahead of Washington and we need passionate advocates like you to help us get this message through

Click
here to read the SEIA release on the SCHOTT Solar Barometer or hereo read the full results (PDF) and help us spread the good solar word!

 

A 25 Year Warranty!

The last time you shopped for something electronic and you made the purchase at Best Buy, hhgregg, Staples, etc., it’s very likely the cashier asked if you wanted to purchase an extended warranty.  I always decline because I expect what I buy to work for a good long time with a minimum five to ten years. Today’s electronic products such as the TV, washing machine, computers  do not make it beyond four or five years.  You probably have heard the term “engineered obsolescence”.  Nevertheless,  I’m still not going to purchase an extended warranty.  I still have longevity expectations of my electronic purchases.  So, how about solar electric systems?

Very different.  A solar electric system, by comparison, is engineered for a very long working life with few service interruptions over several decades of seamless, quiet,  and automatic power generation.  To back this up, there are of course warranties.  Most warranties for solar panels are for 25 years.  Solar panels must be capable of handling a wide spectrum of extreme environmental conditions.  If we use North Carolina as an example, a solar system is likely to be exposed to year after year temperature ranges from as cold as <19°F to as hot as >145°F.  The same solar equipment must  be able to handle even more extreme conditions than presented in NC.  Solar panels have some power degradation over time and manufacturers have done well to lower the power degradation levels and keep performance high.  This power performance is backed up and spelled out in the warranties.  The typical power warranty is split into two numbers such as 10/25 or 12/25. The first number, 10 is years and means the panel is warranted to generate 90% of its rated power at year 10.  The second number, 25 means the panel is warranted to generate 80% of its rated power after the remaining 15 years.

The other major piece of equipment in a solar electric system is the inverter, which converts the solar module generated power from DC (direct current) to AC (alternating current) electricity.  Warranties for this equipment are typically for ten years.  However, the trend is now to extend the inverter  warranties beyond 10 years.  In fact, some inverters now have warranties that match panel/module warranties of 25 years.

The bottom line is solar equipment is made well and designed to operate for a great many years. Considering the extreme environmental conditions solar equipment must operate under, the quality and performance of solar equipment might just be unmatched in the electrical and electronics equipment world.

Increase the Value of Your Home: A Home Improvement with a High Rate of Return

A home owner only hopes to recover the money spent on improvements if they sell their home.  A few home improvements, such as updating kitchens or master bathrooms, might be lucky and get close to a dollar in for dollar back value.   Some home improvements, such as the addition of a pool, appear to add very little value to the home and may only be a “nice” feature.  It would be great to get 100% of your home improvement costs back – but for most, it is unlikely.

We are home owners in the 21st century and a home expense we can’t defer is our energy consumption cost.  However,  we can be strategic in how to face our month to month energy bills.  Tackling home energy challenges or fixing inefficiencies is a very different home improvement.  A renovated kitchen is a pleasure to cook in and attractive to view.  New attic or subfloor insulation offers something very different.  The pleasure comes each month in reduced energy bills, not in how lovely the attic  foam looks. The Appraisal Journal , October 1998, published an article written by Rick Nevin (who specializes in financial, statistical, and economic analyses) and Gregory Watson (a statistical analyst with ICF Consulting.)  Their article, titled “Evidence of Rational Market Valuations for Home Energy Efficiency”,  was a study that  investigated the investment of home energy efficiency improvements.  The authors’ conclusion was that the selling price of homes increased by $20.73 for every $1 decrease in annual fuel bills. Or, the home value increases about $20,000 for every $1000 saved in annual energy costs.  That’s a substantial win and money well spent.

In April 2011, the Lawrence Berkley National Laboratory published, “An Analysis of the Effects of Residential Photovoltaic Energy Systems on Home Sales Prices in California”.  This study evaluated homes with solar electric systems  to see if they sold for higher prices versus homes without solar electric systems.  The results of this study found strong evidence that homes with solar electric systems sold for a premium over homes without the solar power systems.

The Lawrence Berkley National Laboratory study is not alone in its conclusion.  Several other studies that evaluated the attributes of solar electric systems compared to increased home value, cost recovery and increased speed of home sale, also showed similar outcomes. These studies demonstrate that investing in a solar electric system is quite different from typical home improvements.  With solar electric systems, dollar for dollar cost recovery is a reality.

Price Drops and the Influx of Chinese Made Modules

Quality vs. Quantity.  Where do we stand?

A commonly asked question to Skyward Solar Power Company is,”What solar panels/modules do you use?”

Skyward is often approached by manufacturers asking us to utilize their product as the choice module for our solar installations.  These manufacturers come from all around the globe from countries such as Germany, China, Canada, Japan, Netherlands, Mexico, Philippines, and of course the USA.  Our challenge is to find what differentiates one manufacturer from another and create a group of favorites to select from.  This is difficult because the once clear differentiating gaps have closed and a great many solar module manufacturers meet the quality and performance bench marks now typically demanded as standard. Ultimately, does this mean that solar modules will become a commodity and are chosen by price?

It may shake out to this and China will be the driver.  Once upon a time, solar modules made in China had a less than best in terms of quality – low cost and cheap reputation.  A pillar of solar is quality – solar systems are designed, engineered, and installed for 30 years of almost automatic and seamless power production. Therefore, panels were selected as German made, US made or Japanese made.  But this is no longer true.

Today, many Chinese manufacturers meet the quality demands expected but at a much lower price.  The past differentiators of watts per square foot, tight power tolerances, efficiency, and mechanical and power warranties are standard expectations and no longer the clear differentiators they once were.   Manufacturers such as SolarWorld known for their consistently high quality and proven top performance world- wide now must compete against manufactures who also can deliver the key differentiators but at a much lower price. This new world is going to be a paradigm shift for industry leaders such as SolarWorld.

Three years ago, I installed Sanyo solar modules on my own house.  I chose Sanyo because of their unique engineering that included layering thin film technology with monocrystalline technology, which was not available from any other manufacturer. The Sanyos work beautifully and I consider them high performance solar modules.   I later installed them on a commercial project and monitor their performance against a month by month benchmark expectation.  Again, their production is excellent.  However,  I have not installed them since. The reason simply is I can confidently choose other manufacturers at a far lower price, meet the power production targets, and satisfy all the necessary key differentiators we automatically expect from a high performance quality made module.

Obviously, solar module manufacturers are keenly aware of the danger of working in a commodity driven market .  This is in our favor because we are getting very high quality technology with excellent pricing that continues to fall.  What we don’t want to see are the Sanyo’s and SolarWorld’s driven out of the solar market because of price.  Module manufacturers like these two have contributed significantly towards solar innovation and set the original high quality standards for others to strive to match.  The question is:  when do we use their product if we can deliver an equal outcome at a much more competitive price?

Cause of Electric Rate Increases

NC utility rates have steadily risen since 2000 to pay for the rising cost of fuel, new coal, and natural gas power plants – but not to pay for renewable energy and energy savings programs as many consumers may think.  The NCSEA has conducted an investigation into the rate increases and will be releasing an Electricity Rates and Economic Impacts Report in early October.  Find NCSEA’s fact sheet at http://energync.org/assets/files/Rate%20Impact%20Fact%20Sheet(1).pdf

Energy Map

Check out this energy map http://www.good.is/post/transparency-america-s-appetite-for-energy/

Solyndra: A Sad Story For American Ingenuity

You may have heard or read about the recent collapse of the Solyndra solar module manufacturing company.  Perhaps you were angered by the $500 million government loan Solyndra received.  After all, some of that money came directly out of your pocket.  The media has positioned this story as one that is all about the loan and drove the story on an emotional level that focused on big government loans and bankruptcy. Certainly a story to be told.  However, there is another story not reported.

I work in the business of solar.  Skyward Solar Power Company specializes in solar electric system installations.  Typically, every solar installation we work on presents unique scenarios and unique challenges.  As solar specialists, we find the solutions to these projects and the outcome is a high performance solar electric system engineered to generate power for the customer for decades.

This is where Solyndra comes in.  Solyndra researched the various solar electric system installation scenarios and uncovered the unmet needs which technical solutions were not available.  With this data, and in their R&D, they created a very unique technology and manufactured it.  The Solyndra solar module works well and provides a number of excellent features no other solar module/panel made in the world is able to deliver.  It was well received by many solar installation companies who clearly liked its special features.

Why did they fail? Solyndra launched as solar cells and solar module pricing started a deep and rapid decline in pricing.  Solyndra was not able to join this new pricing market because their manufacturing has complexities that standard panel manufacturing simply does not.  This prevented them from competing.  In spite of their special features, when it came down to dollar versus dollar and ROI versus ROI the standard panels have the upper hand.   At Skyward Solar Power Company we submitted six Solyndra proposals and were not able to sign any of them solely because the price decreased the customer’s ROI.  The uniqueness of Solyndra was not enough trump lower cost technology.

I can’t speak to Solyndra’s use of their $500 million dollar loan.  I have no idea how well that money was used.  I do know Solyndra, designed and manufactured in the USA is American ingenuity at its best.  At a time when America is desperate for quality jobs, and demands “Made In The USA” –  Solyndra delivered .

Price Cuts Stimulate Growth in PV Projects

Due to reduced solar module pricing, there has been a significant increases in solar photovoltaic project development in the US.  The non-residential project pipeline has increased from 17 GW to 24GW, according to the United States Deal Tracker database by Solarbuzz.  http://solarbuzz.com/our-research/recent-findings/solar-module-price-cuts-stimulate-massive-growth-us-photovoltaic-projec