Tuesday, August 13, 2013

Solar Operations and Maintenance are Increasingly Important

As solar energy steals headlines around the world there is a general trend in the industry toward more proactive and sophisticated operations and maintenance (O&M). As the solar industry continues to grow and evolve, strategies for effective O&M have acquired more importance.

The solar industry and other renewable sources of energy accounted for more than half of all new power plants in 2012. It makes sense that solar is among the fastest growing of all energy sources given that so much of the sun's energy remains untapped. The commonly heard refrain from solar power advocates states that there is enough sunlight in one hour to meet global energy demand for an entire year.

Solar power is crucially important because it reduces our need for dirty and destructive sources of energy like coal. The more solar energy we have the more we reduce the health and climate impacts from fossil fuels.

To help make solar power more efficient, O&M practices are increasingly important to owners, operators, developers, financiers and investors. Those involved with solar power production are looking to optimize their ROI by maximizing system output and streamlining O&M costs.

Historically, there was little incentive for US owners to manage and maximize system output as incentives were paid based on nameplate capacity or installed costs. Now, performance based incentive (PBI) programs pay system owners based on the energy a system actually produces.

In the US solar industry these changes have shifted metrics away from rated system capacity (kW/MW) to actual energy production (kWh/MWh). This is causing owners of solar facilities to increasingly focus on performance efficiency and system longevity which are important O&M related factors.

There has been a rise in the use of performance guarantees (a risk mitigating mechanism offered by third party system operators to ensure that a system produces a certain level of energy). Performance guarantees contribute to the growing importance of O&M. The increased focus on O&M has also coincided with more attention on safety and reliability.

Performance based incentives and interest in long term asset ownership, have combined with other factors to make solar O&M a salient concern.

© 2013, Richard Matthews. All rights reserved.

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