Radian Generation is a proud returning contributor to the annual kWh Analytics Solar Risk Assessment. Each year, industry experts weigh in on the ever-changing landscape of solar production risk. See RadianGen Director of Technical Operations, Jackie Ahmad’s quantitative insights below. You can find the full report here: https://www.kwhanalytics.com/solar-risk-assessment
80% of performance tickets linked to inverters in 2020 due to reliance on OEM warranty service, extreme weather, and COVID
An analysis of nearly 2 GW of utility and commercial solar plants in 2020 shows that 80% of performance-related plant tickets are caused by inverter outages, as shown in Figure 1. These inverter outages result from a continued reliance on the original equipment manufacturer (OEM) warranty services and extreme weather. Additionally, pandemic travel restrictions significantly impacted mean time to repair (MTTR), as shown in Figure 2, further impacting project performance and underscoring O&M challenges. These issues are described further below.
Drivers of Inverter Outages
- Reliance on OEMs: Many inverter manufacturers are reluctant to offer training and certification to O&M providers to allow them to independently change out failed subcomponents without voiding the warranty. It is also rare to have cost-effective, efficient service level agreements (SLAs) in place with the OEM; many of these service agreements are more expensive than the losses associated with downtime. This often causes delays in repairs and long outage times due to OEM tech unavailability. These inverter repair delays were exacerbated in 2020 and 2021 with extreme events: the global pandemic and Texas Winter Storm Uri.
- Pandemic: Lockdowns on travel became widespread in the US in March of 2020 due to the COVID-19 pandemic. While utility workers were generally exempt from the lockdown, travel by OEM techs came to a near standstill unless the techs lived within driving distance from site. This phenomenon resulted in longer repair times. For example, inverter outages that required OEM on-site support went from a MTTR of 6.9 days in Q1 of 2019 to 19.6 days in Q1 of 2020. This number went back down to 6.5 days in 2021 as travel restrictions eased.
- Extreme Weather: In February 2021, Winter Storm Uri caused approximately 70% of Texans to lose power. While solar performed better than natural gas and wind plants, most site and equipment designs did not anticipate the severe weather, causing inverters to trip offline and require OEM intervention. While most inverters were restored to service fairly quickly, some repairs were delayed due to flight cancellations. Even a day or two delay resulted in millions of dollars of lost revenue due to the $9,000/MWh ERCOT scarcity market price.
Conclusion
Notably, the best time to negotiate warranty SLAs with OEMs is prior to the purchase of the equipment, however the project sponsor is often not yet involved. Warranty negotiation would then fall to the EPC who may not have the same incentives, since they’re excluded in the long-term ownership of the site. Therefore, it’s important for financiers to review site design and SLAs closely. Specifically, we recommend considering the history of OEM response times, reviewing the revenue structure of the project in the context of service agreements with inverter OEMs, and asking potential O&M providers about their training and certifications with OEMs.
