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Intersolar 2014 brings interesting news and realities to solar PV

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Intersolar 2014 brings interesting news and realities to solar PV

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More than ever, patience and passion is needed by developers to prevail when building a PV power plant. With the increase in panel pricing due to the tariff and the reduction in PPA’s the developers and EPC’s are getting squeezed from both ends. The expansion of the tariff to close the loop hole of using Taiwanese cells in Chinese panels and an upcoming tariff on Taiwan’s cells, has caused PV module prices to increase by 10 to 15 cents per watt.

PV solar Tariff’s allow a newcomer have an advantage

Newcomers like RECOM www.recom-solar.com have become excellent solar PV options because they manufacturer in Europe and Korea for the US market. Their European production management team oversees production in all locations. With the tariff news out and little clarity to what it really means, RECOM had to move US related production to Europe and Korea.

Banks and Financial Institutions search for good solar projects

The market changes have convinced early stage developers with viable projects to sell their project earlier than before. Investors such as Starwood, GE Capital, NRG and newcomers like Greebacker, Coronal/Panasonic, ECOPower Capital, Chamberlink, etc. are looking to buyer earlier because of all the financial institutions interested in purchasing solar projects. Now banks and financial institutions are taking less time to complete due diligence and approving financing. This reduction in time is a direct reflection of the positive returns created from the solar power plants that are presently in operation.

What is Bankability

We hear Developers and EPC’s speaking about bankability yet bankability has become less of a question when it comes to PV panel manufacturers. Every time a PV manufacturer sits in the first place position of sales we find them having financial problems or making some dramatic costly error, yet the power plants where their panels were used continue to work. Fighting to stay number one seems to bring about their disappearance or their loss of relevance after a year or two.

Bankability for inverters and mounting system is important as well. In fact, each of these technological components are secondary to the experience, balance sheet and reliability of the Developer’s and EPC’s. Before the Developer and or EPC has been approved for financing the funding organization has gone through an extensive calculation to ensure the return on their investment. These financial institutions are scrutinizing the whole development process and their legal arms work at ensuring lose ends are tied up.

Storage gains ground in the renewable space

One of the most essential additions to renewables is the continual growth in the use of storage. Finally, storage has become a more viable addition to solar PV developments. Companies like Princeton Power Systems ( www.princetonpower.com ), designs and manufactures state-of-the-art technology solutions for energy management, microgrid operations and electric vehicle charging. Princeton Power is becoming a global energy management leader working with customers and partners across North America, Europe, Africa and the Caribbean.

Their UL and CE-certified power electronics are used in advanced battery operations for PV projects, with built-in smart functions for ancillary services. Princeton Power builds customized, integrated system designs, with expertise in commissioning and operating microgrids.

Bankability today does not mean Bankability tomorrow

Strategies to be considered to improve the odds that your project will get financing include:

  • Work with companies that have a good reputation, experienced team, strong balance sheet and follow through with their agreements.
  • Plan for bankability early in the engineering process by collecting data and having it vetted by recognized third-party companies like PVEL (PV Evolution Labs has merged with DNV GL) and SolarBuyer.
  • Review your technology company’s quality control and reporting systems before it becomes a problem.
  • Obtain the right price point for each component and the BOS.
  • Ensure the management team of the technology manufacturer is responsive and willing to put in the time and energy to deal with issues before they become problems.

What is the dictionary explanation of bankability

1. bankable - guaranteed to bring a profit; profitable - yielding material gain or profit;

2. bankable - acceptable to or at a bank/financial institution; "bankable funds" acceptable - worthy of acceptance or satisfactory;

Global markets such as US, Japan, Africa & China are the strength of PV solar

In closing although the tariff and PPA pricing has dampened the U.S. market our industry should out-perform Europe. The solar market has moved rapidly beyond its reliance on Germany/Europe. The US, China, Japan, Africa, Mexico and finally South America are becoming meaningful consumption markets.

As the solar market achieves truly global scale, established Energy Corporation, and non-energy corporations have entered the market through partnering, joint ventures, project joint developments, using their tax equity options and investments via mergers and acquisitions and having their own PV power plants built.

If you have any questions or you would like to find out more about RECOM or the other companies mentioned in this article please contact me at br@recom.gr or 916-284-8841.

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