Grid-Scale Solar Underperformance is Significant: What are the Issues?

 

     Capex for utility-scale solar had been dropping steadily until 2022 when those costs rose for the first time in decades. In mid-2022 insurance provider kWh Analytics did a cost-analysis in that year’s Solar Risk Assessment report. They concluded that grid-scale solar remains plagued by underperformance issues. Performance remains below expectations. According to Liam Stoker of PV Tech, the assessment: “cites new research confirming that system degradation, inverter availability and overly-optimistic PV modelling have meant that the solar industry has “significantly overestimated” expectations of solar assets and, as a result, will need to “reckon the realities in the field with the assumptions we use on paper”. Along with those issues, other issues were analyzed that contribute to local and regional solar underperformance, including topography and uneven terrain (up to 6% performance losses) and extreme weather events such as hail and wildfire smoke. Wildfire smoke led to as much as 3% annual soil–related performance losses at solar PV sites in California between 2018 and 2020. Operational risks include inverter performance and inverter service support problems. Overall, the study identified by far the largest underperformance issue as financial modeling risk, which is routinely overly optimistic. kWh noted: “92% of lost EBITDA is due to underproduction, dwarfing all other sources of risk.”

    In the same report, Solargis, a solar resource data company, recently analyzed “annual global horizontal irradiation (“GHI”) compared to long-term averages, finding significant resource variability in North America over a period of 23 years from 1999 to 2021.” They concluded that annual solar irradiation is 10% below long-term averages in several U.S. regions.

     One problem with inverters contributing to operational risk is inverters abandoned by manufacturers who discontinue models and go out of business. Solar operation & maintenance company Solar Support noted in the same report that solar facilities with discontinued inverters from manufacturers no longer in business perform at an average of 85% technical availability whereas the industry standard goal is 97-99% power plant availability. Grid solar operator NovaSource, also in the same report, reported that inverters were underperforming compared to expectations during their 2-year warranty period. They concluded that inverters underperformed by 40% during the 2-year warranty period. NovaSource found average inverter failure incidences at about 1 per year per inverter (0.8-1.4 times /year). That is not a large problem by itself, but one must also calculate mean-time-to-repair (MTTR) in order to evaluate effects on technical availability. Again, and surprisingly, inverters under warranty performed worse and required more time to repair. Suggested strategies for improving the problems include better inverter testing before large deployment, developing an inventory of standardized parts and expertise to speed up repair times, and enabling O&M companies to perform some repairs to decrease down time.

     Underperformance from uneven terrain that increases shading can be addressed with more advanced tracking and better modeling. DNV calculated up to 6% of losses from uneven terrain, much of which can be reduced.  

     There are some other issues that lead to underperformance such as Balance of System anomalies associated mostly with large and complex systems. String anomalies were the most common, but inverter, combiner, module, and tracker anomalies also affect performance. Digital Analytics company Raptor Maps, in the same report, concluded that these types of anomalies led to 2.63% underperformance in 2021, up from 1.85% in 2020.

     Basic system degradation results in efficiency losses that the NREL calculates at an average of 0.75% per year. This is based on 4915 inverters being analyzed and with a total of more than 7.2 GW under observation monitoring for long-term performance.

     Manufacturing changes can affect system degradation. In solar module manufacturing, doping with gallium instead of boron has improved the problem of destabilization but has also led to faster degradation. This will require more research, says PV Evolution Labs, also part of the study.

     Current ongoing supply chain issues can also have negative effects on quality control/quality assurance. Better inspection, testing, and further QC/QA may be needed.

     Analytics company UL Solutions noted that the recent study concludes that solar underperformance compared to pre-construction estimates is at 6.3% on average and that 3-4% of that lost energy is recoverable as the problems that lead to it are addressable. UL Solutions provides monitoring, production key performance indicators (KPIs), analytics, and reporting.

     The kWh solar assessment report also showed that actual production vs. P50 estimates have been getting further apart in recent years despite improvements in module and system efficiencies through the years. A December 2022 article in PV Tech by Jonathan Touriño Jacobo notes: “… the underperformance trend remains a nationwide issue with average lifetime performance ranging from 5-10% below initial P50 estimates across the US, with the exception in 2021 of the Northwest and Southeast regions which improved by 1% and 2%, respectively.”

  U.S. Solar Installations: Source: Bloomberg NEF. Note: Capacity reported in direct current (DC) terms.

 

References:  

US solar remains beset by underperformance issues as capex costs on the rise. Liam Stoker. PV Tech. June 14, 2022. US solar remains beset by underperformance issues as capex costs on the rise - PV Tech (pv-tech.org)

Analytics and expertise to assess, optimize and report on operational performance. UL Solutions (website). 2023. Operational Performance Assessment For Solar Assets | UL Solutions

US solar assets ‘are not meeting performance expectations’, kWh Analytics says. Jonathan Touriño Jacobo. PV Tech. December 7, 2022. US solar assets ‘are not meeting performance expectations’, kWh Analytics says (pv-tech.org)

Solar Risk Assessment: 2022: Quantitative Insights from the Industry Experts. kWh Analytics. Solar Risk Assessment: 2022 Quantitative Insights from the Industry Experts (squarespace.com)