06 jerome crotteux - 3 e

BETTER ASSESSING RENEWABLE ENERGY PROJECTS 3E’s lessons learned – PV projects February 2011

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INDEPENDENT EXPERT IN RENEWABLE ENERGY & ENERGY EFFICIENCY

• + 20 years of experience in renewable energy

• Offices in Belgium, France, Turkey and China .

• Driven team of engineers, PhD´s, scientists and experts

• 15 nationalities

• Result driven management

• Linked to major research programs

• Independent consultancy • Technical Advisor

• PV

• Wind

• Biomass

• Energy efficiency

• Power markets

• > 15 countries

Expertise

Grow

th

People

Projects

3E AS PREFERRED PARTNER FOR FULL RISK ASSESSMENT

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3E is well positioned to fully assess and

control risks in renewable energy

projects

World-class expertise

Full risk assessment and integrated organisation

Recognised globally in the renewable energy industry

Experience in renewable energy for more than

20 years

SOME REFERENCES

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Major financial institutions Industrial clients Associations

Due Diligence

COMBINED KNOW-HOW STRENGTHENS DUE DILIGENCE QUALITY

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Design phase

Realisation phase

Operational phase

Evaluation phase

3E’s experience during lifetime of RE projects

Energy scan

Project feasibility

Design verification

Module assessment

Yield verification

Full project guidance

Site progress visits

Provisional commissioning

Final commissioning

Operational monitoring based on 3E tools

Intelligent alarms sorting

Exact diagnostics and remedies

Short term predictions

feedback feedback feedback feedback

Financial monitoring based on 3E tools

Increased reactivity tools

3E’s long term track record PV projects – lessons learned

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EPC contract

O&M contract

Surface lease contract

PPA contracts

Material choice

Design

Performance

Resources & yield

Design phase

Realisation phase

Operational phase

Evaluation phase

Contracting phase Design and yield estimations


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Design phase

Realisation phase

Operational phase

Evaluation phase

Defects/errors Description Profit reduction

Incomplete contractor’s obligations Contractor’s obligation are not exhaustive regarding the installation works. Works and responsibilities as AC (Middle-Voltage) works, effective grid-connection, etc. are not included.

Mainly for international projects where the frame is flue.

0 - 10%

Errors in yield/performance guarantees Faulty measurements equipment

Yield guarantees are set up based on faulty references. Under-/overestimation of the expected yearly yield (incoherent P50). Too optimistic guarantees can lead to unexpected recurrent penalties for the contractor (until bankruptcy?) or low guarantees can lead to un-maintained plants.

Contract’s formulae are based on un-accurate measurement equipment or references (real plant’s performance is unknown). Strong overestimations are common (based on inverters production data and sensor cells).

2 -12 %

Definition of completion and acceptance

Contracts should include performance verifications. The guarantee, risk and ownership should not be allowed if the real performance is not known. Mechanical/electrical completion is not enough for assessing the quality of energy plants. Acceptable test period between completion and acceptance should be taken into account.

Plant could be accepted with an average performance far below the P50 scenario.

0 - 11 %

EPC contracts / Framework agreements


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Design phase

Realisation phase

Operational phase

Evaluation phase


Proposed material Components should be described or list of potential components should be available for review. Components’ quality and performance can highly fluctuate (also in case of same technology). Designs are depending of chosen components. When new components are chosen, the errors’ probability is rising and uncertainty on P50 is substantially increasing.

0 - 60 %

Spare parts / Provisions Proposed number of spare parts or proposed provision are clearly defined or not covering the failure risks. Spare parts could be part of O&M. Spare parts are depending on the design concept (central or string inverters).

0 - 5 %

Operational control Use of inadapted monitoring systems. Errors/failures could not be detected. 0 - 5%

EPC contracts / Frameworks

Unknown new brands and suppliers !!!


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Design phase

Realisation phase

Operational phase

Evaluation phase


Incomplete contractor’s obligations Limited contractor’s obligations or liabilities. Can lead to unexpected additional costs. i.e.: replacement defected parts, cleaning modules, direct environment maintenance (shadow problems), etc.

0 - 10%

Errors in yield/performance guarantees Faulty measurement equipment

Idem EPC 2 - 12 %

Poorly adjusted O&M concepts O&M strategy is in depending on project location (roof, ground), direct environment (industrial activities), design (centralised or decentralised inverters).

0 – 8%

Yearly degradation Too pessimistic power degradation. Can lead to irrelevant yield guarantees and un-maintained plants. Depends on technology used.

0 - 0.6%

Incomplete preventive procedures Can lead to unexpected losses or unsafe situations.

i.e.: tests of electrical switches, grounding issues, no detection of yield losses due to soiling, high cables losses, inefficient inverters, etc.

0 - 5%

O&M contracts


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Design phase

Realisation phase

Operational phase

Evaluation phase


Incomplete contractor’s or owner obligations

Limited contractor’s or owner’s (tenant’s) obligations or liabilities.

i.e.: roof and environment maintenance, stability issues, site consumptions, roof access, electrical maintenance, etc.

0 - 10%

Surface lease contracts

PPA contracts Defects/errors Description Profit reduction

Short term contracts Long term cash flow conditions are not ensured. 0 – 0.5%

Non market conform prices Underestimation of the purchase prices. 0 – 0.5%

No indexation Absence of price indexations. 0 - 0.4%


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EPC contract

O&M contract

Surface lease contract

PPA contracts

Material choice

Design

Performance

Resources & yield

Design phase

Realisation phase

Operational phase

Evaluation phase

Contracting phase Design and yield estimations


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – Material choice

Modules • Questions:

1. What constitutes a “good quality” module? basic quality. 2. How “reliable” will the module be in the field? reliability.

• New/unknown brands New technology Toll manufacturing

High risk; impact on profit: 0 – 60%

?


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – Module Quality & Reliability

Module certifications Based on IEC, EN, UL or other standards. IEC61215 (cSi), IEC61646 (thin film) design qualification.

• Module performance capability in accelerated environmental test. IEC61730, UL1730 safety qualification.

Limitations Insufficient statistical data from PV fields:

lack of data for reliability standards. IEC61215 & 61646 do not address long

term reliability, ie. design qualification does not imply module’s reliability.

Basic Quality

Reliability


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – 3E Module Technical Assessment

Module Technical Assessment • Focus on mid-term risks • Complimentary to IEC • Detailed evaluation of manufacturing

practice and quality management • High expertise required

Implemented manufacturing & quality practice (documentation)

evaluation

On-site factory evaluation

+

• To-date: 22% of assessed unknown module brands are not satisfactory.


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – Material choice

Inverters • new unknown brands lower risk as mostly EU products

future: will be needed (trend in other countries to use non-EU inverters / new design concepts)

• power electronics more expertise from manufacturers • reduced impact on profit: 0 – 25% (max. in case central inverters) • inverter is assembly of interchangeable parts

• main potential errors • use of unsuited and inefficient inverters

impact on profit: 0 - 6% • installation errors (IP class, ventilation, etc.) invalid product guarantee • insufficient safety (DC switches, etc.) • incompliance with national grid connection codes

If failure, component can be replaced


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – Design Defects/errors Description Profit reduction

(probability) AC diagrams not supplied Losses on AC cables are unknown. 0 - 2% (50%)

Flash tests not supplied Effective power and mismatch losses are unknown. 0 – 3% (25%)

Grid-connection study supplied Compatibility between grid capacity and plant power is unknown. 0 - 20 % (38%)

Mounting structure is unknown Compatibility with roof stability and chosen module is unknown. 0 – 20% (19%)

Error in sizing inverters Inverters are undersized. Affecting the PR. 0 – 3% (6%)

Error in connection modules to inverters

PV arrays with different characteristics are connected to the same inverter (MPP tracker). Non-optimal system.

0 – 3% (38%)

DC diagrams not supplied Losses on DC cables are unknown. 0 – 2% (13%)

Undersized DC cables High losses and overheating issues. 0 – 5% (13%)

Stability report is not respected Roof is not strong enough for proposed PV system. 0 – 20% (19%)


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – Design Defects/errors Description Profit reduction

(probability) Shadow is underestimated Expected losses are underestimated. 0 - 8% (6%)

Absence on product warranties Proposed material does not have the minimal warranties. 0 – 5% (12%)

Use of inefficient inverters Inverters with low efficient are proposed. 0 – 5% (6%)


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – Performance • portfolios under full scope: actual PR = 82.6%

• if design verification was not performed and issues resolved lower PR

• difference between 3E’s PR estimation during design verification and actual PR = 1.9%

verification on design level required for obtaining high PRs 3E’s PR estimations are accurate (< theoretical models uncertainties)


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Design phase

Realisation phase

Operational phase

Evaluation phase

Design and yield estimations – Resource and yield

P50 estimation • benchmark of data sources is required

• local effects can always occurs and could affect the results • Belgium relatively flat profile but differences in uncertainties up to 6% • New PVGIS data base: tentative to improve accuracy

• 3E integrates it in the benchmarked results but accuracy is not better than other sources

• Climate impact not proven and historical data analysis (KMI – 3E study) does not show any significant trend for the increasing of long term irradiation averages


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Design phase

Realisation phase

Operational phase

Evaluation phase


P90 estimation

NB: P90 is not 90% of PVGIS’ P50

• PVGIS’ P50 is not taking into account design details and subtleties Estimated error of +/-10%

• P90 is not 90% of a P50 value Estimated error of +/- 5 to12% (Belgium: +/- 6%) • P90 is a statically calculated value based on long term daily values and including precise combination of all uncertainties

• uncertainties on models, algorithms (depending on technology used, etc.) • standard deviations


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Design phase

Realisation phase

Operational phase

Evaluation phase


High yields possible – P50 > 850 kWh/kWp.y

But only thanks to higher system performance And not thanks to higher irradiation averages !!!

Low standard deviations and relatively low uncertainties in comparison with other RE technologies lower risk on resources’ availability


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Design phase

Realisation phase

Operational phase

Evaluation phase

Realisation phase – Installation risks

Site progress visits for MWp systems

Sample based site progress visits for smaller systems • site visits expensive for small projects • solution: randomly samples => cost reduction 25% and risk by 50%

• how fast an issue is identified, how easier the implementation of the solution and how lower the risks are • visits at crucial moments and not only mechanical expertise


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Design phase

Realisation phase

Operational phase

Evaluation phase

Realisation phase – Installation risks Provisional commissioning • state-of-the-art protocol

• visual inspection, measurements, performance verification • >3 weeks between grid-connection and tests (accuracy of performance measurement) • expertise for right diagnostics

Final commissioning • reduced scope • still important as some errors only identifiable after several operational months


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Design phase

Realisation phase

Operational phase

Evaluation phase

Realisation – Commissioning Defects/errors Description Profit reduction

(probability) Poor monitoring system Alarms are not taken into account. Maintenance control is low. Performance

decreases are not identified (not working inverters – 11%) and solved. 0 - 20% (43%)

Modules and mounting structure not correctly mounted

The mounting structure and the modules are not correctly installed. Roof damages are possible.

0 – 5% (29%)

Difficult roof access The roof access is difficult. Maintenance operations will be done under poor and unsafe conditions.

0 - 20 % (3%)

Differences between design and as-built

Modifications between the provided design and the reality on site. 0 – 5% (11%)

Badly installed inverters Inverters are not installed in accordance with supplier’s recommendations. Guarantees are not applicable or inverters are inefficient.

0 – 9% (14%)

Unexpected shadow Obstacles were not mentioned in the design documents and are casting shadow on the plant.

0 – 8% (3%)

Damaged components Electrical boxes, cables, inverters, modules, etc. were damaged during installation works and were not replaced.

0 – 2% (11%)

Dirt deposition Unexpected dirt deposition due to direct environment. 0 – 2% (6%)


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Design phase

Realisation phase

Operational phase

Evaluation phase

Conclusions • full scope still needed due to learning curve experience by installers

• portfolio risks and contractor’s overestimated guarantees bankruptcy risk not always insured

• very dynamic market bottlenecks and thus risks change rapidly • new module manufacturer assessment and expertise required for quality evaluations (dynamic and maintained eligibility lists possible) • multi-disciplinary expertise required

senior experts expertise in module manufacturing PhD experts meteorological experts experts with RE experts commissioning experts modelling experts 11 nationalities

3E’s PV team


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Design phase

Realisation phase

Operational phase

Evaluation phase

Irradiation Problem: inaccuracy of sensor data / single sensor on site / sensor failure Consequence: inaccuracy on system performance (PR) estimated at +- 8%

Solution: benchmarking of sensor data with external satellite data

Meter Problem: inaccuracy of inverter meter reading Consequence: additional inaccuracy on system performance (PR) estimated at +- 3%

Solution: Green current meter reading

Failure Problem: Failure or malfunctioning of specific components in solar park Consequence: important losses on annual yield of the park

Solution: Moniotring by exception and 24/7 alarm management – inverter based

Problem: unforeseen or unexpected shading on installation Consequence: important losses on yield of the park

Solution: Smart alerts to indicate unexpected shading (trend analysis) – performance based Shading

Installation errors

Problem: installation errors, not reported in inverters (wiring errors) Consequence: unexpected system losses which arise in annual verification

Solution: 24/7 monitoring with inverter performance checking


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Design phase

Realisation phase

Operational phase

Evaluation phase

Wiring Problem: Wiring error at string level during installation Consequence: Performance loss at 1 inverter

Solution: Field intervention and re-wiring

Case Detailed description Impact on annual yield

Case specific: 2,3% No intervention:13%

Shadow Problem: Grass grown too high and shaded modules Consequence: Daily performance loss due to schadow

Solution: Field intervention and maintenance

Case specific: 3,5% No intervention:28%

Component Problem: Underperformance of 1 of the 4 inverters Consequence: Daily performance losses in the morning

Solution: Field intervention / change power electronics

Case specific: 1,1 % No intervention:18%

Earthing Problem: Inverter disconnection due to earthing error Consequence: Daily disconnection of inverters

Solution: Field intervention / change wiring

Case specific: 0,4 % No intervention:3%


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Design phase

Realisation phase

Operational phase

Evaluation phase

Stakeholders of energy

performance

Owner / Investor “I can’t follow up the financial & guaranteed performance of

my entire portfolio”

O&M “I must minimize my operational

costs while meeting the contractual guarantees”

Others - Energy consumers - Turbine manuf. - Compo. Manuf. - Traders - Dispatchers - DSO/TSO

Business Portal

• Report from park to portfolio level • Mirror to business plan • Report system and resource perf. • Report lost income • Follow up contractual guarantees • Receive critical business alerts

Operations & Maintenance Portal

• 15‘ / 10’’ granularity analysis • Technical parameters reporting • Receive all alerts • Alerts management • Interventions management • Instant portfolio monitoring

Other Portals

• Marketing portal • sub-contractor portals

Evolution PV perspectives in Belgium

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Next step in project development based on future tariffs

• decreasing incentives ⇒ the only solution for converging to grid parity

• proposed new scheme • bad communication • no support for innovation / intelligence • increasing hurry for new projects before July

⇒ lowering engineering quality and material choice ⇒ no space for roof membranes renovations

• finalisation & commissioning during summer • high dependency evolution module prices • increasing surface leasing prices • bank financing limitations due to 15 years period


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Actual characterization Belgian market

• large number installers & developers • high population & building density • low industrial/engineering knowledge • high installed peak power capacity / inhabitant • low EPC prices due to high competition, rooftop systems • number smaller installers moving to large scale systems

=> Intensive competition leads to higher technical risks: • cheapest material choice • surpassed roofs’ capacities • uncontrolled risks in proposed contracts


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Possibilities for sustainable market

• reinforcement knowledge energy in buildings for better energy integration • development BIPV experience – special incentives for pilot projects? => privileging onsite consumption • research/innovation grid interaction, short term forecast • development new mounting system (aerodynamics, roof integration) • use yield optimizer for better efficiencies on roofs • involving industries in research & concept/product developments

=> ensuring diversity, expertise and internationalisation perspectives • participation from Belgian companies in foreign start-ups • improving quality residential systems => installers quality labels • reinforce communication & co-development under professional clusters

3E WORLDWIDE

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B-1000 Brussels T +32 2 217 58 68 F +32 2 219 79 89

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06 jerome crotteux - 3 e

Documents

evolution pv perspectives

yield estimations resource

supplied losses

unexpected shading

system performance

design qualification

spare parts

important losses