The end of the year was quite a scramble to meet the expiration of the grant in lieu of ITC expiration date, but we were able to do it.  Baker & McKenzie was great to work with as was Reznick and we got it done.

Now a few transmission hurdles and we will be able to break ground and complete these projects. 

The CREST program and SCE’s transmission network is a world unto itself - there is an incredible amount of complexity to understand so that you have a REALISTIC idea of when you are going to be able to connect your project to the grid and how much it’s going to cost you.

There are many developers out there pushing CREST projects who are seriously deluded on connecting their projects to the grid!

We have been looking at the business of cleaning and maintaining solar PV systems.

According to Go Solar California (the organization that runs the California Solar Initiative) there are over 51,000 systems either installed or currently reserved in the big three shareholder owned utilities’ territories (PG&E, SCE and SDG&E).

In looking at systems that have been in place for as little as three years it’s amazing to see how dirty the panels have become. We have also seen panels shaded by weeds growing up from in between the panels!  This especially seems to be an issue with some of the early SunPower (Powerlight) lay flat systems.  The complete lack of access to the interior portions of these systems is a major problem for conducting ongoing maintenance.

We inspected another site where the system was producing less than 2/3rds of projected production and the managers on site had no idea.  The monitoring company that had been paid to monitor the system not only failed to notify the owner, they didn’t even realize they were being paid to monitor the system and had never enabled the data link to the meter!

These examples are for multi-million dollar commercial systems.  It’s likely that there are similar problems in the residential sector.  System installer’s salespeople often told the prospective buyers that the system would be maintenance free and require no servicing.   In many instances this has not been the case.  Panels get dirty, inverters malfunction, connections fail, etc.  Meanwhile the production suffers, and once production is lost you can’t get it back.

At a minimum, it seems like there is a real need for reliable remote monitoring - like an alarm company for your solar PV system.  Owners can receive daily email reports, or texts with a summary of the previous day’s production, or simply a “your system is functioning normally” message.  Prolonged below expected production would then trigger a service call to find out what’s wrong with the system before more production is lost.

Amazing how SPI continues to grow and grow - we mostly did meetings but couple anecdotes from the exhibit hall:

1. Panel manufacturers - how can any of these guys possibly distinguish themselves from the competition on a technical or features basis?  Other than bankability (warranty) and price - there is no discernible difference.  Commodity.

2.  Tracking, concentrating, other than pv technology (for distributed gen) - lots of interesting things, but I am not sold on the long term performance of these systems and maintenance requirements.  Also not “bankable” at this time with any banks or TEI’s I know of - that makes them a non-starter, unfortunately.  This is a prime area for DOE loan guarantees, in my opinion.

3.  Attendance - massive.  So much buzz around solar yet so few people actually making real money in the space.  I suppose it’s a combination of people still feeling that they are early in an industry that will take off and a genuine passion for green/environmental/sustainability.

4.  (related) Public Attendance - on Wednesday night the show was “open to the public” and the lineup to get in was around the block.  Shows either that the “public” has a real hunger for solar or free exhibit hall swag.

5.  Inverters - in a follow on to the Intersolar event in SF, it seems that larger inverter manufacturers are starting to realize that inverter replacement puts a huge crimp in the cash flow of a financed project and are coming up with ideas to essentially include a reserve in their pricing to accommodate future replacement.  Can take the form of an extended warranty or premium pricing that includes service and replacement.

Recurrent Energy and Kaiser

SCE/Sunpower - T5 product

Wells Fargo and SunPower team up to offer PPA’s.

Interesting exchange between Greentech Media and Vinod Khosla..

As of January 2010, I have joined Renergy Capital, LLC as a partner, along with Jeff Phillips and John Markham.

We intend to finance distributed solar generation, fuel cell and other renewable energy projects at commercial scale.

But JLM, as Seth Godin says, sometimes it’s more important to know when to quit if you want to succeed (see “The Dip” for example). Always a fine line between persevering/”never say die” and “the definition of insanity is trying the same thing expecting a different result”. Sometimes you have to find the door instead of bashing your head against the same wall, but some times there is no door! I know you are a military historian, should the British have continued to fight in France (never say die/press on) to victory or retreated (quit) at Dunkirk? I bring this example up because I believe it is often cited as one of the greatest military decisions in history, preserving the men of the British army so they could eventually succeed in WWII, right? Look forward to your thoughts on this one.

Great post! Sometimes street smarts can take a while to sink in (or be rediscovered). I founded a company in 1999 and left a very staid old (low margin) industry to do so. The founder of my prior company had boostrapped it over 25 years into a $100M business and I learned a lot about how to run a lean and successful business from him. That all went out the window when we took venture capital in 1999. Every board member was on top of our management team to hire every consultant and headhunter we could find so we could “push out product out to the market” and “grab attention and market share” and “staff up”. I guess on the one hand they were right, because as Steve Blank says “in a bubble, get liquid”. With another round or two and a bunch more employees and some semi-useful software, I guess we could have emulated Ariba, Commerce One, or one of the other ecommerce/vertical market companies that never really had a solution that solved ANY significant problems but managed to make the employees rich, but we missed that window by about 6-12 months. That did not end well! Fast forward to my next two companies where we “recovered our street smarts” and bootstrapped and had to find early customers to make ends meet, and that discipline forced us to develop stuff that people would actually pay for. The flip side to that is that bootstrapping and trying to find quickly addressable markets can cause you to go after small markets/solutions that can’t result in the kind of home run you dream of as an entrepreneur. I guess there is a happy medium in there where street smarts combine with thinking big and if you look hard enough (maybe that is an element of street smarts as well) you find an addressable entry point to a large market. That way you get early traction but can grow into a situation where you can grab the brass ring in the large market. Again, thanks for the post and the series!