Last week marked yet another Solar Power International. We sat down with Joe Song, Senior Director at Sol Systems, to discuss some of the Sol engineering team’s biggest takeaways from this year’s show.
Module price declines continue, and they are here to stay. This year at SPI, rumblings of further declines were heard throughout the conference. As we have written about in past issues of SOURCE, this is due to a number of issues, such as the solar investment tax credit (ITC) extension and decreased demand from international markets.
In 2016, we’ve experienced an approximately 20 percent price decline since the beginning of the year for conventional polycrystalline technology, which may force high efficiency module manufacturers to react accordingly to stay competitive. We would not be surprised to see some modules prices dip below the $0.40/Watt range by the end of 2017, and we anticipate that these price declines will be permanent.
The U.S. Department of Energy’s $1/Watt by 2020 goal is becoming very real, and has a real chance to exceed those goals in some markets.
The inverter space is changing rapidly. The introduction of extremely price efficient Chinese inverters ($0.04/W – $0.08/W), combined with new competition in the utility-scale space is giving incumbent inverter companies a run for their money. 1500V certifications should enable 2017 utility projects to more widely deploy higher voltage installations, with the goal to shave a few pennies from Balance of System (BOS) costs.
The small utility-scale space is of increasing interest to EPCs and equipment manufacturers alike. This sector is perceived as the next “it” market sector, and Sol Systems built out a utility-scale origination team in Q12016 to focus more on this sector (generally speaking, <25MW, though this team is currently reviewing projects 7MW – 40MW in size). These projects are efficient with shorter development timelines than large utility-scale, can be more targeted to grid-specific “need” areas, avoid transmission interconnection, and may still achieve price economies similar to large utility-scale projects. Many community solar program size limits fall within this range.
Creative, brilliant, and necessary technologies were on display in the exhibit hall this year. We observed some broad leaps in the tracker space, a continuation of the module/racking integrated product approach, light-weight carport products, bi-facial and laminate crystalline silicon modules, and high voltage inverters. We continue to see opportunity to optimize core components, reduce balance of system costs, and find ways to enable disruption. The exhibit hall was littered with great ideas that are being supported by industry partners such as Powerhouse and DOE SunShot. We’re excited about the opportunity to witness continued innovation
Carports and single axis trackers are growth areas in the Balance of System and racking space, where we see these types of projects increasing in market share. Trackers are especially increasing in popularity as the pricing and design have improved to enable smaller projects, with higher tolerances for interesting site conditions. Carports continue to be one of the main levers in the C&I space and should experience efficiencies as products find ways to reduce steel and incorporate installer-friendly design. Competition within the racking space will continue to be fierce, as arguably more gains may be achieved with racking when compared to other core components.
Have questions on technology trends? Shoot us a note at firstname.lastname@example.org, and we’re happy to connect you with our engineering team.
This is an excerpt from the September edition of SOURCE: the Sol Project Finance Journal, a monthly electronic newsletter analyzing the solar industry’s latest trends based on our unique position in the solar financing space. To view the full Journal or subscribe, please e-mail email@example.com.
ABOUT SOL SYSTEMS
Sol Systems, a national solar finance and development firm, delivers sophisticated, customized services for institutional, corporate, and municipal customers. Sol is employee-owned, and has been profitable since inception in 2008. Sol is backed by Sempra Energy, a $25+ billion energy company.
Over the last eight years, Sol Systems has delivered more than 500 MW of solar projects for Fortune 100 companies, municipalities, universities, churches, and small businesses. Sol now manages over $650 million in solar energy assets for utilities, banks, and Fortune 500 companies.
Inc. 5000 recognized Sol Systems in its annual list of the nation’s fastest-growing private companies for four consecutive years. For more information, please visit www.solsystems.com.