For businesses that are planning to install PV systems, there are essentially three major choices that must be made: which equipment to buy, what the size of the system should be, and which installer to hire. In addition, you’ll need to consider where you want to put the system and how you’ll finance it.
Development of specifications for quality equipment has largely been completed by organizations that subsidize PV systems, such as the California Energy Commission (CEC).
Modules. When looking for high-quality PV modules, the CEC’s current list of eligible photovoltaic modules is a great place to start. Many utility rebate programs require that the modules used in a PV installation meet the CEC’s or other, similar standards. The requirements for inclusion onto the CEC list are that modules must be certified by a qualified test facility to meet Underwriters Laboratories (UL) Standard 1703, “Standard for Safety for Flat-Plate Photovoltaic Modules and Panels,” and manufacturers must submit electrical test data demonstrating module power output to be within 10 percent of the module’s nameplate rating. Today’s PV modules typically carry a 10-year warranty, though an operating life of 30 years or more is not uncommon. There is no minimum efficiency standard for PV systems.
Inverters. In addition to complying with all safety and interconnection requirements, the CEC requires that inverters undergo performance testing by a qualified laboratory, and the CEC publishes the results of that testing for each inverter. To make it onto the CEC’s list of eligible inverters, individual models are required to pass UL’s tests for safe operation and interconnection with the utility system, as well as a battery of performance tests.
Along with the classic multimodule string inverters commonly used with solar arrays, microinverters are also now available that can handle DC-to-AC power conversion for individual PV modules. In installations with a high likelihood of future expansion or those that have unique configurations, microinverters may be desirable, though they also tend to be a more-expensive option.
Like most PV modules, today’s inverters also typically carry a 10-year warranty, but inverter lifetimes are about half as long (15 years) as module lifetimes. They therefore must be replaced at least once over the course of a 30-year array life, and the cost of inverters represents about 10 percent of the overall installed cost of commercial PV systems.
Storage. Although electricity storage batteries remain relatively cost-prohibitive for many commercial PV applications, the benefits of adding storage to on-site renewable power generation make them attractive for continued consideration. Storage batteries enable more flexibility for system sizing and grid-interfacing options, opening up the door to strategic power purchasing, peak demand reduction, and electricity resale. Batteries can provide momentary backup power and can also help to buffer the energy used on-site.
But batteries are a much more expensive option than generators for providing backup power during momentary or prolonged outages. And though integrating batteries into an on-site PV system offers potential benefits, it may also require a significantly different, more complex, and more expensive system design than one without battery storage. Storage is more likely to be desirable and cost-effective in applications where backup power generators are already in use; where critical loads are being served; or where electricity prices are high, demand charges are significant, or tiered pricing increases are steep.
When considering the inclusion of storage, it’s important to work with a contractor that has significant experience with both PV systems and battery storage—and such knowledge is not always locally available. Consider evaluating offerings from larger companies—for example, Solar City (now Tesla), Solar Grid Storage, and Kaco—many of which offer storage options for grid-tied PV systems.
Sizing your system
Over the 30-year life of a typical commercial PV system, the amount of money a business saves will depend on a number of factors, including the level of solar resource (how much sun reaches the PV array site), the available space for siting the array, the local utility rates, the availability of financial incentives, and the method and interest rate used to finance the installation.
Given these factors, it’s critical to choose a qualified PV contractor or installer that offers engineering and design services to assist in sizing your system. If there are multiple qualified contractors in the area, consider requesting quotes from two or three different contractors and compare their designs, recommendations, and project costs.
Selecting a qualified installer
As the demand for grid-connected PV systems has risen in recent years, so too has the demand for qualified installers. Many contractors have entered this field with little formal training in PV system design and installation or in the PV provisions of the National Electrical Code. This lack of PV-specific experience increases the possibility that inexperienced contractors will make design or installation errors that negatively affect system performance.
Since 2003, one of the more reliable indicators of solar contractor proficiency has been certification by the North American Board of Certified Energy Practitioners (NABCEP). This certification is conferred on PV installers who pass a rigorous exam that was developed with input from PV-industry stakeholders. Before a contractor is eligible to take the NABCEP exam, which is offered twice each year at many locations around North America, they must demonstrate that they possess the necessary experience or educational prerequisites.
NABCEP certification is widely recognized in the industry as the single most credible indicator (though not a guarantee) of contractor competency. Contractors who have received NABCEP certification are listed in the NABCEP contractor database. Another resource for finding local solar contractors and reviewing their qualifications is Solar-Estimate, a partnership between the nonprofit American Solar Energy Society (ASES) and Seattle-based online tools developer and solar business organizer Cooler Planet.
Siting a solar array
Some businesses place PV arrays on parking lot canopies, atop pole mounts, or on racks in open fields, but the majority are sited on rooftops. Important criteria to consider when selecting the location for a commercial PV installation are how much sun exposure the site has, the condition of any of the site’s building surfaces, and the presence of any objects that will shade the array. These are all factors that the solar contractor will take into account when sizing a system to develop a quote.
In general, a flush-mounted array on a slanted roof will be the least expensive option; a ballasted array that’s angle-mounted on a flat roof will be more expensive and have a larger footprint. A PV array should not be sized and sited to use all available space. Rather, it should be sized to provide the best economic scenario for the business and to fit appropriately within the available space.
Estimate the available solar resource. Solar resource refers to the average annual amount of sunlight that reaches a given site. The greater the solar resource, the more energy a particular PV array will generate. One of the most powerful and simple tools to help with this type of site evaluation is a free online tool from the National Renewable Energy Laboratory called PVWatts. This tool allows you to quickly estimate system output throughout the year based on geographic location and system setup.
Determine the condition of the existing roof. It’s vital for businesses to be apprised of the condition of their roof prior to installing a PV array because once the array is in place, the cost of any necessary repairs will be substantially greater. So if the existing roof is in poor condition, the time to address that problem is before the array is installed.
Minimize the impact of shading. When an individual cell within a module or an individual module within an array is shaded, its output will be reduced—and typically to a much greater degree than simply the proportion of the area that’s shaded. This can be an even larger problem for some polycrystalline modules because of the way they’re built—their panels effectively shut down when heavily shaded or covered with snow. When siting an array, the contractor will assess the local “solar window” for it, effectively estimating the unshaded region of sky at different times of the year.
Measurement tools and software made by companies such as Solar Pathfinder and Solmetric are available to help PV array owners and contractors estimate the solar window for a proposed or existing array. They can also predict or measure performance throughout the year. Proper and regular tree maintenance can help maintain the original solar window for a given PV system, especially for systems mounted at ground level.
Financing a solar installation
Finance mechanisms can play a significant role in determining the cash-flow scenario and net present value for commercial PV systems. Capital and operating leases are among the most popular financing options. Another often-used option is power purchase agreements, which enable business owners to establish contracts for the sale of future power generated at their facility, whether to a utility, to another third-party aggregator, or even to a financial vehicle such as a yieldco, which effectively treats future anticipated power production as a tradable resource.
Whichever financing structure you settle on, the solar array should be sized in such a way that either the monthly payments for the system, including any applicable maintenance fees or taxes on avoided utility expenses, are lower than the avoided costs (the electric bills) or the yields on power traded exceed amortized system costs. And of course, the ideal financial investment plan should break even in fewer than 30 years and include all anticipated lifetime costs (such as replacement inverters and modules and maintenance costs).