- Let your “why” lead the way.
Rooftop or onsite solar installations offer numerous company benefits, such as financial savings and hedging, carbon footprint reduction, and future-proofing various sites. As a first step, we recommend defining your priorities, anchoring these within your organization, and letting these priorities lead the way when rolling out your solar projects.
What do we mean by “lead the way”? Let’s say, for example, that your primary motivation is financial savings. You should prioritize the sites that generate the most savings. Moreover, cost will be a key evaluation criteria in your Request for Proposal (RFP) process, and your finance team should be a key stakeholder in your roll-out. Suppose, instead, that your key motivation relates to sustainability values. You’ll want to focus on a different set of sites, evaluation criteria and internal stakeholders.
- Identify and involve your internal stakeholders early on.
As with any organizational change project, you need to address questions from your internal stakeholders. Don’t wait. We recommend inviting your colleagues to raise their questions early on. Or, if that is too time consuming, send out an FAQ. Why not involve your supplier in the process?
Typical key stakeholder groups may pose questions like these:
- Site team: How will the installation and O&M impact site operations? What are our responsibilities?
- Finance team: How should our financial reports reflect the contract/s? What is the business case?
- Sustainability team: We already buy green power from the grid. What’s the difference? How will it impact carbon reporting? Are the panels sourced from sustainable suppliers?
- Legal team: What happens if we decide to exit the PPA agreement? Why does the contract have to be so long?
- Let your supplier do the heavy lifting.
Don’t overthink the choice of technology or engineering. Instead, focus on your solar installation as a source of energy. If you choose a good supplier, the supplier will be able to provide a site feasibility assessment as well as engineering and design. They should also be able to outline and drive your permitting processes.
Pete Rive shares how large RFP processes were driven in the U.S: “For some major RFPs in the U.S., we only received the GPS coordinates for installations at more than 100 sites. It was then up to us to assess the feasibility and quote a price and design for each site. In the end, what mattered the most to our customers was the energy savings – what would they be paying for solar energy compared to what they were paying utility companies to meet their energy needs.”
- Spend time on the “right” risks.
On a similar note, what are your real risks?
Pete Rive: “If you choose the PPA model, you only pay for the energy produced and are reimbursed if the system produces below the agreed-upon minimum level. If the system does not perform, you do not pay. Therefore, it does not make sense to spend time thinking about performance risks or technical risks related to the system.”
What, then, are your real risks?
Pete Rive: “You will be paying a fixed electricity price over an extended period while the market remains volatile. You then face the risk of electricity prices dropping. Is that a considerable risk? There is the possibility that electricity prices will decrease for short periods during your PPA agreement. However, given a 20-year perspective, that risk decreases significantly.”
- Go big straight away if you can.
Rolling out more than 10 sites may seem overwhelming, but hopefully we have provided some insights into the value of multisite roll-outs.
Pete Rive shares his final piece of advice: “Go for it. Rolling out several sites at scale makes financial sense while delivering sustainability benefits. As the number of sites increases, a solar PPA provider can generally offer lower prices. There are also economies of scale regarding your legal and administrative costs.”
Pete Rive, Founder of SolarCity (now Tesla Energy) and onsite solar advisor at Alight
Pete is a founder of SolarCity (IPO Nasdaq 2012), one of the largest US solar PPA firms, which has merged with Tesla and been rebranded as Tesla Energy. Peter has in-depth experience of supporting large corporate buyers, such as Walmart and Intel, in rolling out solar effectively across a large number (100+) of sites. During Peter’s time at SolarCity, the company completed more than 300,000 solar power installations.