Energy Toolbase’s Post

Technology firms are the dominant industry investing in solar as electricity demand soars to keep pace with data center growth. #Business #EnergyStorage #Installations

Why the solar industry's favorite financial metric isn't broken (but it's not enough) There's a heated debate happening in clean energy circles about LCOE (Levelized Cost of Energy) - the industry's go-to metric for evaluating solar projects. Some say it's broken. Others defend it. Both are missing the point. Here's a reality check: Arguing whether LCOE is "right" or "wrong" is like debating whether a hammer is the right tool. It depends entirely on what you're trying to build. Let's use a real-world example: Imagine you're planning a solar farm in Texas. LCOE tells you the average cost per unit of electricity over the project's life. That's useful—just like knowing a car's average miles per gallon is useful. But here's where it gets interesting: • Local electricity prices might spike during summer afternoons • Your panels might perform differently than the regional average • Grid connection costs vary dramatically by location • Storage could completely change the project economics LCOE captures none of this. But that's not a flaw—it's just the reality of what the tool was designed to do. Smart developers understand this. They: 1. Use LCOE for initial screening 2. Layer in local market analysis 3. Add detailed performance modeling 4. Validate with multiple approaches Here's the key insight: The problem isn't with LCOE—it's with treating any single metric as the complete answer. Just like a doctor wouldn't diagnose you with only a temperature reading, we shouldn't evaluate multi-million dollar energy projects with just one number. Question for energy leaders: What combination of tools do you use to evaluate projects in today's complex market? #CleanEnergy #SolarDevelopment #EnergyFinance

I've been looking at more detail into Australian Energy Market Operator (AEMO) Connection score card for the FY ending June 2024, and also comparing it to the FY ending June 2023, firstly, much better format so well done to those pulling the data together 👏 . There are a few things that jump out at me that show we (the renewable energy industry as a whole) need to do better: 1. Not NEARLY enough plants are making it through commissioning and to full output. If you saw David Dixon from Rystad Energy speak at the Clean Energy Council's ACES this week, you'll know that number needs to be above 8GW a year to meet 2030 targets. Last 12 months was struggling to make it towards 2GW 2. Projects do not seem to be moving fast enough between 5.3.4A and Market Registration. While the FY ending June 2023 saw 6.8GW get 5.3.4A, one year later less than half of that made it to market Registration. But most of this seems to be a delay between when the Proponent passes the 5.3.4A milestone, and then gets round to submitting their R1 package. I can't see how Proponents can complain and want an R1 rule change, when many seem to be taking an eternity to submit R1. Of course AEMO and the NSP will need to check everything! Don't you realise how much the network can change in 2 years! If you're not targeting Registration within 6-9 months of 5.3.4A, then maybe you need to find a different industry to Develop stuff in. 3. December 31st is an artificial target we set ourselves. The 5.3.4A numbers (driven by a large number in NSW) have a huge spike in December and then disappear in January and February. The energy transition is a marathon. A sprint every December only then to collapse in Q1 the following year does nothing to help and promote long term sustainable growth. 4. Applications by technology class are back the front if we want to hit 2030. We need more wind than batteries, but wind seems to be on the down. I think though this has more to do with State Government planning processes delaying development, rather than Developer appetite for such projects Very interested to know what of this you agree with and disagree with. https://lnkd.in/gxuEnSh5

Solargis updates software for PV project design, evaluation: Slovakia-based solar data provider Solargis has released the next generation of its Evaluate software. Evaluate 2.0 features high-resolution solar and meteorological data, a 3D PV power plant designer, a PV components catalog and energy yield simulations. #RenewableEnergy #Photovoltaic #Technology

Are Companies Undervaluing Solar By Oversimplifying Financial Models? Recent studies have shown that electricity rate structures significantly impact the financial viability of solar—yet many feasibility studies still rely on blended rates and avoided REC costs without deeper analysis. 🔹 Blended Electricity Rates – A 2023 study in Energies (https://lnkd.in/eM-kWz3v) found that using flat or blended rates instead of analyzing time-of-use (TOU) pricing and demand charges can lead to suboptimal solar and storage investment decisions. Solar’s value depends heavily on when and how it offsets peak pricing, yet many studies simplify this into a single average rate. Does this result in undervaluing solar’s actual financial impact? 🔹 Avoided REC Costs – I’ve also seen feasibility studies include avoided REC costs as a savings metric, even when a company has never purchased RECs and has no obligation to. If there’s no real cost to “avoid,” does this inflate a project’s financial case rather than accurately assessing its true value? This makes me wonder—is the reliance on blended rates and avoided REC costs a strategic choice, or is it due to companies not wanting to invest in better rate analysis tools? TOU rates, demand charges, and tariff modeling require data, software, and expertise, but is the reluctance to invest in these tools leading organizations to undervalue solar’s true potential? For those working on onsite energy projects—have you seen cases where a detailed rate analysis changed the financial outlook for solar? Or is the simplicity of blended rates sometimes justified?

Illinois’ ComEd has come up with a tool to help expedite projects in its territory in the Northern part of the state, where demand for solar and storage is high. The utility debuted a new hosting capacity map that is updated every month. This gives developers such as New Columbia Solar a window into where projects are good prospects for near term development, based on their access to interconnection. This type of tool could have significant implications to increasing needed electricity supply and controlling rising costs. In October, ComEd received 2,250 new applications to interconnect with its electric system, which serves more than 4 million customers in northern Illinois. It was the seventh consecutive month with more than 2,000 applications to interconnect with ComEd’s grid, bringing the total applications received this year to 21,952, an all-time high for ComEd, according to Solar Builder magazine. “Our updated hosting capacity map provides developers every month with near real-time information about solar projects in the development queue, which is key to identifying the best available location to interconnect their project to our grid,” said Mark Baranek, senior vice president of Technical Services, ComEd. Across the nation, management of interconnection queues is a problem. Jammed queues are making it hard to get projects online quickly enough, creating a supply-demand imbalance and raising electricity prices. We believe that tools like the ComEd hosting capacity map will help speed project development in Illinois and could be an example for other jurisdictions to follow. https://bit.ly/4hOUUmf

🔋 The business case for long duration energy storage 🔋 Although long duration energy storage (LDES) can provide a variety of benefits to the grid, current market mechanisms are limited and do not incentivize LDES investment. Building longer duration storage requires additional upfront capex, and the incremental revenue from current wholesale power markets are insufficient to justify storage buildout beyond 4 hours. Power plant revenues are not just tied to energy prices, but are also tied to capacity prices, which exist to ensure power is there when needed. These capacity prices will become increasingly important for the financial performance of short and long duration storage assets due to the widespread deployment of solar. Solar, which can only provide power during the day, and therefore has limited capacity value, is creating demand for complementary capacity resources like storage, placing upward pressure on capacity prices. Solar also generates power at zero marginal cost, placing downward pressure on energy prices. Capacity markets themselves are evolving, too. These markets are moving to more sophisticated ways of compensating generation & storage capacity, using metrics such as effective load carrying capacity (ELCC) that will eventually result in additional revenue for storage with durations beyond 4 hours. The exact timeline of this transition will depend on factors such as variable renewable energy growth, accelerating demand growth due to AI, and evolving weather patterns due to climate change. In the short term, we expect LDES deployments to be limited to projects directly with regulated utilities as they are able to leverage their guaranteed rates of return to invest in LDES to provide grid resiliency and satisfy other longer-term clean energy targets that are not directly compensated by existing wholesale power markets. #energy #energystorage #batteries #bess #climate #ldes #economics

Utility rates and access to reliable electricity were once afterthoughts for real estate owners and tenants. But today, with the rapid growth of data centers and energy rates outpacing inflation, energy is now front and center in real estate planning and management. I'm excited to share SolarKal's latest Utility Rate Escalation Study. Dive into our findings to see where utility rates are heading and how real estate owners can stay ahead. #EnergyManagement #RealEstate #Solarenergy #SolarKal

☀️ 𝐓𝐡𝐞 (𝐇𝐢𝐝𝐝𝐞𝐧) 𝐂𝐨𝐦𝐩𝐥𝐞𝐱𝐢𝐭𝐢𝐞𝐬 𝐨𝐟 𝐒𝐨𝐥𝐚𝐫 𝐏𝐫𝐨𝐠𝐫𝐚𝐦𝐬 🌍 The energy industry is anything but uniform and this becomes especially clear when operating in multiple states (just ask any solar company) Whether you’re navigating Regional Transmission Organizations (RTOs), state policies, or individual utility rules, the complexities vary significantly. 1️⃣ 𝐂𝐨𝐦𝐩𝐥𝐞𝐱𝐢𝐭𝐢𝐞𝐬 𝐀𝐜𝐫𝐨𝐬𝐬 𝐑𝐓𝐎𝐬/𝐈𝐒𝐎𝐬 RTOs/ISOs (e.g., PJM, CAISO, ERCOT) operate large swaths of the grid and play a crucial role in shaping solar program dynamics: - In RTOs like PJM, solar projects compete in capacity and energy markets - ERCOT, with its energy-only market, prioritizes different mechanisms - Regional Resources & Transmission Constraints 2️⃣ 𝐒𝐭𝐚𝐭𝐞-𝐭𝐨-𝐒𝐭𝐚𝐭𝐞 𝐕𝐚𝐫𝐢𝐚𝐭𝐢𝐨𝐧𝐬 Every state approaches solar differently, driven by local policies & priorities: • Renewable Portfolio Standards (RPS) • Net Metering Policies • Geography and Solar Potential 3️⃣ 𝐔𝐭𝐢𝐥𝐢𝐭𝐲-𝐋𝐞𝐯𝐞𝐥 𝐃𝐢𝐟𝐟𝐞𝐫𝐞𝐧𝐜𝐞𝐬 Even within the same state or RTO, solar programs can be different: - Investor-Owned Utilities (IOUs) may prioritize accordingly - Utilities with modernized grids can adopt more and faster - Those with aging infrastructure may face limitations - Utilities with > demand-based rates may discourage adoption complexity demands understanding — It’s a longer-term play as opposed to short-term gains. The complexity of programs / strategies is undeniable, varying by RTO, state, utility. 𝑻𝒉𝒆 𝒓𝒆𝒂𝒍 𝒗𝒂𝒍𝒖𝒆 𝒊𝒏 𝒕𝒉𝒆 𝒍𝒐𝒏𝒈-𝒕𝒆𝒓𝒎 𝒍𝒊𝒆𝒔 𝒊𝒏 𝒖𝒏𝒅𝒆𝒓𝒔𝒕𝒂𝒏𝒅𝒊𝒏𝒈 ⚡ #Sustainability

📊 The Importance of Analysis in the Solar Industry: Boosting Performance Ratio for Maximum Efficiency ⚡ In the world of solar energy, Performance Ratio (PR) is more than just a number—it’s a critical indicator of system efficiency and reliability. But how can we ensure PR remains at its peak? The answer lies in deep and continuous data analysis. Why is Analysis Important? 1️⃣ Early Problem Detection: By analyzing trends, we can identify issues such as energy output drops, dirt accumulation on panels, or inverter failures before they escalate. 2️⃣ Operational Optimization: Data insights help us understand energy usage patterns and weather trends, enabling strategic adjustments to maximize output. 3️⃣ Maximizing ROI (Return on Investment): With systems operating at high PR, investors are assured their solar projects are performing at their best. 4️⃣ Compliance with Industry Standards: PR is a key metric to ensure projects meet LSS specifications and global benchmarks. How Voltake Leverages Analysis At Voltake, we utilize data technologies like Google Sheets, Looker Data, and automated analytics systems to: ✅ Generate weekly & monthly performance reports ✅ Analyze long-term trends ✅ Develop data-driven maintenance strategies The Result? Our solar plants consistently deliver high-quality, clean energy to the community. 🌞 Want to learn how data analysis can help your solar projects achieve better PR? Let’s connect! ✨ #SolarAnalysis #PerformanceRatio #SustainableEnergy #Voltake