At Intersolar North America, the cleantech industry delivered supply-chain and soft-cost solutions as policy threats loom in the distance.
by Julian Spector
July 14, 2017
Intersolar North America packed glitz and glamour into San Francisco's Moscone Center this past week as outside events created an underlying sense of unease.
The ongoing Section 201 trade complaint hovered over the expo hall and cocktail receptions alike. Meanwhile, just 90 miles away from the conference, the California Senate bill that would create a 10-year step-down for energy storage funding got quietly pulled from the schedule, pushing it to next year's legislative session.
The solar section of the expo had condensed from three floors to two, and many of the big names in the industry weren't visible on the floor. Storage, though, filled up a considerable chunk of the acreage.
There wasn't a readily identifiable hot new trend on the floor, in the way that VR sends shivers down the spines of our more mainstream tech friends in the Valley. If I had to pick out an overarching theme, it's a humbler one: the gradual consolidation of disparate, interlocking technologies to reduce friction throughout the supply chain.
There were solar modules shipping from the factory with a microinverter already built in; solar trackers with space for factory-built flow batteries to bolt into place; solar inverters with a built-in EV charger, to eliminate redundant wiring and labor costs down the road. Not earth-shattering, but these kinds of efficiencies add up to soft-cost reductions and easier lives for installers. It's the step-by-step improvement of a maturing industry.
Lost in the legislature
So about that California Senate bill. SB 700 aims to do for energy storage what the California Solar Initiative did for solar: use a long-term funding commitment to foster a young industry, with the rebates phasing out as adoption picks up.
In this case, the bill would replace the Self-Generation Incentive Program and extend the storage rebates through 2027. The plan isn't dead, but Assembly rules are such that it can't be taken up again until next year.
This seemingly narrow proposal touches on several bigger and more powerful industries. Interestingly, the big public support behind it came more from solar folks than the usual energy storage advocates. One of those leading supporters, CALSEIA, responded to the delay with an allegation of utility meddling.
A utility that procures and distributes money may well want to avoid or delay the scenario in which a large swath of the state population turns its home into a miniature power plant. For his part, Committee Chair Chris Holden told me that the utility interference explanation "is a simplistic statement" that "avoids the substance of the issues surrounding further development of storage in California." That's not quite a no, and doesn't shed much light on what issues concern him with the evolution of storage in the state.
SGIP still has a few years of runway left, so the legislative developments shouldn't hamper storage deployments through the rest of the year. What's at stake is the additional investment that industry might make with the certainty that California will prioritize this technology for many more years to come.
We've seen a few high-profile acquisitions in the storage space, but this week brought a new kind of union. Independent power producer AES will merge its storage team with the counterparts at electrical equipment company Siemens to forge a new global storage heavyweight. They dubbed the venture "Fluence."
AES brings a decade of utility-scale storage experience and a leading position in terms of megawatt-hours deployed. Siemens brings a global sales and engineering presence in 160 countries, plus a commercial storage business.
The dynamics here reflect the growth of the industry itself. AES owns power plants; at a time when few companies were developing large storage projects, AES decided to do it in-house. A few years later, that expertise became valuable to others, and AES started developing for third parties.
"AES as an IPP is more accustomed to owning and operating assets, and in that context, AES Energy Storage's pivot to system integration has been, at some level, divergent from AES' core business model," said Ravi Manghani, energy storage director at GTM Research.
"While that has worked so far as the storage industry has remained relatively small, and AES' storage business was close to a rounding error in the parent company's financial reporting, it is natural that the storage business reached a juncture where to scale any further would need capabilities that look more like an industrial equipment vendor than an IPP," he said.
Fluence, then, represents the storage business at two very large companies growing robust enough to merit a standalone business model.
Massachusetts, here we come?
I tried to gauge the level of excitement storage professionals were feeling about the newly chosen 200 megawatt-hour procurement goal in Massachusetts. I can't claim a comprehensive sample size, but so far I have yet to find a company that has planned a significant buildup of operations in response.
The most committed response was a company that had "laid the groundwork" for an eventual ramp-up by reaching out to distributors and installers in the Bay State. More common was a feeling of disappointment that the target wasn't as high as state leaders had initially discussed.
The title of East Coast storage industry hub is very much up for grabs. It looks like it will take more than a modest target to attract the West Coast players to open new offices. If you're a storage company planning a new branch in Massachusetts, though, shoot me a note at firstname.lastname@example.org.
The inverter-coupled solar module is here
Enphase has taken its distributed inverter architecture to its logical conclusion.
The company has released AC modules -- solar panels that ship with a microinverter already built in -- with LG and Jinko. The former ships later this month and the latter will be available in early Q4.
The mechanism ships flat, with the microinverter lying flush with the frame of the solar module. To prepare for hookup, you pull the inverter up from the back of the module, and it locks into position with a satisfying snap. That leaves 1.5 centimeters between inverter and module, which is key to the system's air-cooling process.
The aim is to sell the integrated product for the same price or less than the discrete products. Enphase envisions this model taking over the residential solar space due to the savings associated with easier system installations.
The tradeoff is that AC modules remove an installer's ability to mix and match modules and inverters based on a customer's needs. The market will decide whether the potential savings justify the commitment.
All that's missing from an AC solar module is the ability to simultaneously install storage. California company JLM has been pitching something similar with its Phazr product, a battery that slips onto the rack during installation. We're still waiting for someone to test the value proposition of the solar-storage-inverter trifecta.
Tracker-sized solar-plus-storage is here
NEXTracker is selling solar-plus-storage at the tracker level with its NX Fusion Plussystem, currently aimed at large commercial customers.
This is a product to watch for any flow battery sympathizers out there who are disaffected with lithium-ion's total domination of today's storage market. It has the makings of the first truly mass-scale flow battery deployment.
The product situates a 2- or 4-hour vanadium flow system from Avalon Battery on the end of the tracker, to extend the hours the solar system can deliver energy and eliminate clipping, in which power is lost because the inverters can't handle it all.
The batteries are small enough to ship wet (that is, already filled with their electrochemical juices) from the factory, and they come with inverters intact, said Ralph Fallant, NEXTracker's sales director for storage solutions. That increases the efficiency of installation compared to storage systems that have to be assembled onsite.
The design has a few other tricks up its sleeve. It's easier to clear a utility impact study without expensive wires upgrades with a system below 1 megawatt-AC, he noted. The storage allows control over the energy output, meaning the DC solar capacity can be a bit higher without fear that it will put too much power onto the grid at once. More power generated is good for the bottom line.
The system also can get a 20 percent SGIP rebate bump because it is manufactured in California -- San Leandro, to be exact. Lastly, the system architecture makes it possible to prove that none of the electricity charging the storage systems came from the grid, maximizing the investment tax credit that the system can claim.
Fallant wouldn't get into the details of how many of these trackers have shipped so far, so we'll have to wait to see whether the concept is catching on. He did say he was getting a "huge amount of interest" from the developers and EPCs the company sells to.
Building a name in the U.S.
Tabuchi Electric has been building hardware in Japan for almost 100 years. It's been focusing on solar inverters for the last 20 years, and has a storage system that combines its inverter with Panasonic lithium-ion batteries in 10- and 20-kilowatt-hour sizes. A partnership with Geli for battery management software will reach fruition in three to six months.
The company has sold more than 20,000 hybrid solar inverter and storage systems worldwide, with a majority going to OEM customers, said Daniel Hill, director of sales and marketing at the company's U.S. branch.
The challenge now is to spread the Tabuchi name in the U.S., where it doesn't have the same kind of recognition as in Asia.
A mark in its favor is the simplicity of the install. As an inverter specialist, Tabuchi put all the necessary power conversion equipment in one box, reducing complexity of installation compared to hybrid systems that require additional boxes and wiring, Hill said.