downstream cost reductions to drive mass adoption of ... drive mass adoption of residential solar...

For Mainstream Energy Internal Use Only.

Downstream Cost Reductions to Drive Mass Adoption of

Residential Solar

Gregg Fisher Vice President/General Manager

AEE Solar


Comparing Solar and Consumer Goods


• Need/Demand

• Energy is an ‘anyway’ cost.

• Simplicity

• Consumers gravitate towards things they understand.

• Access

• How many people have access to this product/technology?

Is this considered a luxury item?

• Confidence

• Is the product service reliable and consistent?

KEY MARKET DRIVERS FOR MASS ADOPTION


Simplification of Installation

Main Drivers • Permitting/Interconnection standardization

• Self-standing industry (no subsidies required)

• Cost reduction – 3rd party financing not required

• Integrated products

– ‘Smart module’ with simplified racking attachments and built in AC inverter

• Modularization, pre-assembly, standardization

While integrators not only need a path to installation simplification, they also need to find a sustainable path to cost reduction.


“Local permitting and inspection processes are the bane of the solar industry, and costs are falling at a glacial pace. Certain installers experience this cost rising, and some even refuse to sell in certain jurisdictions that have especially cumbersome processes. These costs are unnecessary and counterproductive, and streamlining will support safety through efficiency and repetition.”

Source: Thinkprogress.com July 2011


2012 Residential System Costs

Source: GTM


Addressable Rooftops by price

Source: Photon

SMA America

Making Solar on Every Roof a Reality

May 17 , 2012

Jurgen Krehnke, President and General Manager, SMA America

SMA America

> $2B+ in annual revenue

> 5,300 employees worldwide

> Present in 20 markets on four

continents

> 12+ GW total manufacturing capacity

> North American production in Denver

and Toronto

> Product portfolio for any application,

any power class

> The world leader in solar inverter

technology

> More than 25 GW installed worldwide

> Estimated 35% global market share

2

SMA Solar Technology AG

SMA America

Challenge #1 – Educating Consumers

3

> End-users are motivated by:

> Return on Investment



> Simply “being green” does little to motivate a

mass market

> Installers and manufacturers should

educate consumers on:

> Understanding incentives

> Knowing the cost of electricity

> Clearly presenting ROI

> Peak shaving (or time-of-use pricing, where

applicable)

> Understanding solar adds value to a home; amazingly, end-users often see increased value in excess of 100%

of the installation cost

SMA America 4

Simplified Example Calculation (Northern/Central California)

> Tiered Rate Structure (PG&E)

> Tier 3 : 130-200% = $0.30/kWh

> Tier 4/5 : > 200% = $0.34/kWh

> Cost of 3kWac Installation

> 3 x $4,500 = $13,500

> ITC = $13,500 – 30% = $9,500

> Energy Production = 4,500 kWh/yr

> Energy cost avoided = $1,400/yr

> Total Return

> System completely paid off after < 6.8 years

> 25 year return = $35,000

> 20 yr ROI = 9.7% !!! (assuming $475 depreciation per year)

> Depending on your cost of electricity, solar might already be the greatest investment!

SMA America

> Solar technology is a “new thing”

> PV technology is decades old and mature

> PV is essentially maintenance free and very

reliable

> PV is a safe investment, often providing

better returns than the stock market

> Solar is too expensive

> Prices have fallen dramatically in recent

years

> Incentives exist in many forms

> Solar leased and PPA’s have, to a large

degree, removed the upfront cost barrier

> Solar only works when the sun is at

its brightest

> Germany is the world’s #1 PV market

5

Challenge #2 – Addressing Consumer Misconceptions & Myths

SMA America

Challenge #3 – Maintaining Policy and Utility Support

6

PV has ample benefits:

> Reduces the need for peaker plants

> Energy production is highest during

highest demand

> Transition to electrically powered

vehicle fleet will require additional

green power generation – PV is fast,

cost-effective

> Grid-management features to stabilize

grid

> Reasonable incentives and policy

support must be preserved as costs

continue to decline towards grid

parity

> Continued cooperation among

regulators and policymakers to support

solar power is needed!

SMA America

SMA is Addressing the Challenges

7

> Industry best efficiencies improve ROI

> 99% Sunny Tripower

> Introduction of higher efficiency transformerless

technology to U.S.

> Grid-management features stabilize grid

> Advanced R&D focusing on cost reduction

> Leading testing and production processes

enhance reliability, reduce replacement needs

> Unique Sunny PRO Club program provides

installers with consumer-level marketing tools

to communicate end-user benefits

SMA America

Summary

8

> “Main street” solar adoption is dependent upon

consumer education

> We need to work together to address

misconceptions and lack of information

> We need to clearly and simply explain the

financial benefits

> We need to address the “politics of solar”

> We can draw parallels to “organic food”

> By meeting these objectives, the industry will

quickly move close to the mass market tipping

point = mass adoption of PV Solar !

SMA America

Thank You

9

Universal PV Interface™ Alliance Overview

May 2012

Greg Madianos, SolarBridge Technologies

Confidential 2

The Universal PV Interface Alliance (UPVI) is an

industry-led initiative to develop a globally-accepted,

standard interface between PV modules and

electronics devices, available for implementation to all

member companies.

UPVI Mission

http://sandbox.upvi.org/Home.aspx

Confidential 3

UPVI Alliance – Goal

Globally-accepted, standard interface between PV modules and electronics devices.


Confidential 4

UPVI Members

SPONSORS

CONTRIBUTORS


Confidential 5

• PV module connectors (finally) became common in late 1990’s

• No attempt to develop a standardized connector

• MC-4 eventually emerged, numerous manufacturers developed mechanically-compatible products. But…

– Vendor-specific tools needed to crimp each type

– Use of incorrect tool invalidates product listing and can lead to failure

• To date – none listed for interoperability

• Potentially serious safety issue and major headache for manufacturers, installers, and AHJ’s

• A PV connector based on a standard design would

have avoided many of these problems

Background

Photon Magazine’s lab tested 39 PV connecters – not a single one received an “A “ grade (Nov 2010)


Confidential 6

“The lack of flexibility in reconfiguring PCs has been acknowledged as the Achilles’ heel to further deployment... from the end user’s point of view, the PC’s I/O interfaces, such as serial, parallel ports, keyboard/mouse ports, etc, do not allow plug-and-play.” [1996, USB 1.1 specifications, page 1]

• Development of USB began in 1994 by a group of seven companies

• Objective was to make it easier to connect external devices to PCs by replacing the multitude of connectors on PCs, addressing the usability issues of existing interfaces, and simplifying software configuration of all devices

• >2 billion USB devices now sold per year

USB Case Study


Confidential 7

• Cost-Neutral with J-box / Cable Solutions

– Base configuration is a simple interface with cable assembly (i.e. a ‘passive’ J-box)

• Cross-Device Compatibility

– Single SKU simplifies development, mfg, and supply chain

– Eliminates need for technology bets

• Cross-vendor Compatibility

• Global Scope

UPVI Requirements


Confidential 8

Current Status 2012 2013

Q2 Q3 Q4 1H

Corporation Established MRD complete

Technical Specification (PRD) underway

Specification Available Member Company Development & Qualification

Certification Testing

First Compliant Products Introduced

Currently developing the Technical Specification PRD there is now an opportunity for early Members to influence the design at a formative stage

UPVI Roadmap


Confidential 9

1. Improved Safety – products are tested and

certified for interoperability

2. Lower Costs – compatible products available

from multiple vendors

3. Increased Adoption – multiple module

companies using same interface

4. Reduced Technology Risk – no need to bet

on one winning technology

5. Simpler Supply Chain – final assembly can

occur in the distribution channel or in the field.

UPVI Benefits


Confidential 10

Membership

Get Involved!

• Membership documents available at www.upvi.org

• Technical working group meetings now underway

For More Information: • www.upvi.org

• [email protected]


http://www.upvi.org/

1 Confidential

SolarWorld Americas Americas Largest Solar Manufacturer since 1975

2 Confidential 2 Confidential

Company Overview

Company Overview


History

1977 1990 2001 2006


Global Presence


US Manufacturing

35 Years of American Manufacturing

Over 1,100 Americans employed

Bankability backed by decades of success

…only the sun has more experience

6 Confidential

US Locations

Hillsboro, Oregon – US Manufacturing Headquarters

Camarillo, California – Sales and Marketing Headquarters


Complete Vertical Integration


Mill

ion

s o

f U

S D

olla

rs

Year

Financial Strength

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2004 2005 2006 2007 2008 2009 2010 2011

Revenue

EBITDA

9 Confidential

SolarWorld is Advancing the Industry

SolarWorld

Product

Support Solutions

10 Confidential

Environmentally sound manufacturing & technology with end-of-life product recycling

Over 35 years of American manufacturing experience

Industry leading 25 year linear warranty

Engineered for real world performance

Improving cell technology to sustainably drive down cost

Product

…quality that leads the industry

11 Confidential

Turn key system design

Authorized Installer Program

Installer training

SolarWorld Financial Solutions

Solutions

12 Confidential

Support

Industry leading customer support

Local distributors and inventory around the US

National network of sales account managers

13 Confidential

Encourage free markets to drive equipment and installed cost down

Technology advancements on BOS

Increasing installation labor efficiencies

Streamlined permitting and grid interconnection

Expanding financing options

Stable incentives

What the Industry Needs to Advance

© 2012 NPD Solarbuzz, part of The NPD Group. All rights reserved.

Schlichting WREF, May 2012

Wolfgang Schlichting

Research Director, NPD Solarbuzz

[email protected]

World Renewable Energy Forum, May 17, 2012

Simplify, Integrate & Standardize - How to design successful products for the

residential PV market which have mass-market potential

http://wref2012.org/

World Renewable Energy Forum Denver, May 2012


Schlichting, WREF May 2012

Agenda

1. Introducing the panellists

2. Setting the Stage

3. Panellists’ presentation

4. Prepared Q&A

5. Open Q&A




Speaker Introduction

Jurgen Krehnke, President & GM SMA

Jack West, Founder & CTO Zep Solar

Gregg Fisher, VP & GM AEE Solar

Prashant Panchal, Residential Segm. Mgr. SolarWorld

Greg Madianos, Product Line Dir. UPVI/SolarBridge




Small Solar Standardization, Integration and Simplification

Open standards, integrated and easy-to-use products were the

foundation of many other industries to reach mass consumer

adoption. (PC, CE, UPS…)

The same can be achieved with small solar systems.

Multi-vendor support of interchangeable modular products

creates a competitive market that grows quickly.

This allows vendors to bring easy-to-install products at

consumer prices to market and sell them at large-box retailers.

Key is to bring stakeholders together to discuss features and

requirements, as well as to learn from best practices in other

industries.

This can bring our industry into this important new phase.




Why Integrate?

Reduce component count

Reduce cost

Move more systems design in the manufacturing

process

Less installation labor (quality & quantity)

Better quality control




Why Simplify

Improve out-of-the-box experience

Speed up the purchase decision time (impulse

purchase)

Easy marketing messaging

Less need for educating user and training of the

installer

Word-of-mouth marketing by satisfied users




Why Standardize?

End-user confidence and adoption

Coopetition

Easy Licensing

Quickly growing market and declining prices

Joint branding, marketing and education

Insured interchange leads to specialization and

cost reductions




Speaker Presentations

Jurgen Krehnke, President & GM SMA

Jack West, Founder & CTO Zep Solar

Gregg Fisher, VP & GM AEE Solar

Prashant Panchal, Residential Segm. Mgr. SolarWorld

Greg Madianos, Product Line Dir. UPVI/SolarBridge

This document contains confidential information related to the patented technology owned by Zep Solar, Inc. This information is not to be disclosed or distributed without express written permission from Zep Solar, Inc.

Jack West • Over 20 years in the PV industry

• Began experimenting with rail-free mounting in the 1990’s

• Filed patents in 2004

• Incorporated the company in 2009

• Has raised capital and grown Zep Solar into global industry leading organization

• Industry’s 1st installation platform

• Licenses Zep Compatible technology to 12 top module and BOS manufacturers (including 5 of the top 10 PV manufacturers)

• Delivering radical cost reductions through standards-based, rail-free, auto-grounding installation systems

Introduction

© 2012 Zep Solar, Inc. CONFIDENTIAL 3

How Zep Is Contributing to Mass Adoption of PV


• Standardization

• Structural Optimization

• Reduced Labor

• Improved Logistics

• Improved Aesthetics

• Improved Safety

Increasing integration, standardization, & partnerships • Cost-saving integration of system components requires partnerships between

manufacturers who design and manufacture around a standard

How Zep Solar is Contributing


Optimizing Structural Systems



Conventional Systems




Leveling

Foot Interlock

Zep System II




Front

Leg

Rear

Leg

Zep System III

Reducing Logistics & Labor Costs



Photos courtesy of Vivint Solar

2-3 residential PV systems consistently installed in one day by 3 man crews

Requirements for Mass Adoption of PV


• Simplify technology

• Reduce cost

• Mass market aesthetic

• Consumer/installer safety

• Attractive financing packages

• Mature customer support infrastructure

• High volume manufacturing techniques

• Sales & Marketing innovations

downstream cost reductions to drive mass adoption of ... drive mass adoption of residential solar...

Documents