“We’re past the gold-rush portion of the solar boom. Now that we’ve got all this solar installed, we need to answer the next question: How are we going to maintain it so it works for the long-term?”
By Frank Andorka, Editorial Director
SunSpec Alliance Development Director Tim Keating caught the essence of the operations-and-maintenance (O&M) debate at Solarplaza’s March Solar O&M Conference in San Francisco.
“We’re past the gold-rush portion of the solar boom,” Keating told the audience of 249 attendees. “Now that we’ve got all this solar installed, we need to answer the next question: How are we going to maintain it so it works for the long-term?”
This is not a throwaway question. The industry has expanded so rapidly in recent years that developers often don’t think about including maintenance into their business plans. This is a huge mistake, says Rue Phillips, CEO and co-founder of True South Renewables, a third-party O&M firm.
“Yes, preventative maintenance is more expensive upfront, but the increased output from the solar project more than offsets it,” Phillips says. “It’s much better to fix things before they break than after.”
Glenna Wiseman, partner in solar marketing firm Identity3, has written extensively about the subject. She believes the level of understanding among solar installers varies greatly by market segment.
“Utility-scale independent power producers (IPPs) build O&M into the equation from the development phase as a rule, and commercial distributed generation (DG) is next,” Wiseman says. “But the application of consistent solar O&M use is, I believe, spotty.”
Cedric Brehaut, principal consultant at SoliChamba, says the United States is a booming market, which makes it attractive to third-party O&M providers. For example, Alectris, a Greek-owned third-party O&M firm, is making a strong move into the United States to take advantage of the recent solar boom.
But will there be projects willing to pay outside companies to handle the O&M? It’s not an easy question to answer, and the partisans on both sides are passionate in their beliefs.
“It’s a mixed bag,” Wiseman says. “As the field of independent solar O&M service providers grows, competition grows. You will have more companies moving to outsourced models.”
Chad Sachs, CEO of Radian Generation, says companies doing their own O&M is a huge drain on resources that can be better spent elsewhere.
“O&M is not something you can undertake lightly as a company,” Sachs says. “It’s a huge investment. You should definitely contract it out to take that burden off your company, which will allow you to focus on what you do best — growing your company.”
But some of the industry’s leading companies, including SolarCity, have decided to bring their O&M operations in-house.
“We’ve centralized our O&M operations so we can keep control more tightly on the quality of the maintenance,” says Jimmy Bergeron, director of O&M for SolarCity. “At one point, we used mom-and-pop solar installers when we started — but as we’ve grown, we have realized the importance of making sure we do a better job of quality control.”
Most O&M providers think it will be the investors who drive the O&M debate and make it part of the ongoing conversation about solar installations.
“Who are the real owners of the solar assets?” Sachs says. “It’s the banks and financiers from around the world. They are not interested in optimizing the performance, but if the project doesn’t function as promised, it will cost them money — and that’s the primary consideration in which they are interested.”
In the end, the competitive O&M market will spur greater diversity of services and will put consumers in an advantageous position.
“Competition is good for the customer so all of this industry dialogue and outreach from service providers will create a more sophisticated market for solar O&M customers,” Wiseman says. “That’s good for everybody.”