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Home > Feature Articles > Alternative Energy Solutions > Solar Energy

The Perfect Solar Storm Has Arrived in California

EI Solutions designs and installs large commercial rooftop solar systems.

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"Solutions" Executive Summary

  • Distributed power is revolutionizing the energy picture
  • Photovoltaic Solar is becoming cost effective
  • Alternative energy meets a growing cultural shift in perceptions
  • California is a hotbed of solar innovation and sunshine!

Photovoltaic Solar Installations
by EI Solutions


The Google solar campus installation will be the largest photovoltaic system in the nation! EI Solutions is the project designer and installation provider.


Commercial systems run the gamut in size. The Seghesio Winery makes profitable use of solar power for its temperature control and processing equipment needs.

Desktop computing and the Internet turned business communications upside down. Communications transformed from centralized powerhouses into a distributed business model.

Alternative energy technologies are creating the same paradigm shift in how power is created and distributed. One example is solar energy and its conversion into electricity using photovoltaic systems. "The grid" has been a closed-system with energy supplied only by the utility companies. Alternative energy sources can now sell extra generated energy to the grid by state mandate. That's distributed power generation. And that's the emerging, disruptive business model for the energy industry.

Distributed Energy is Disruptive Innovation for Energy

Distributed energy represents a paradigm shift for the century-old utility company revenue model which is based on distributing risk over many customers. On-site energy generation, or "distributed energy" as it is called in the industry, is the exact opposite. The risk of producing and distributing energy is concentrated in one spot on one customer. Today this risk is mitigated by the fact that customers have the back-up of still being tied to the grid and are able to draw power when their systems are not producing.


"California's ten-year Solar Initiative (CSI) program gives industry a consistent plan that is very transparent. It's a serious commitment that companies can work with."
Bill Gross, CEO of Energy Innovations


The Million Solar Roofs Initiative spawned the California Solar Initiative (CSI) to encourage solar adoption in the commercial, residential and non-profit sector. The ambitious CSI program hopes to see 3000 MW of solar installed in California by 2017. To achieve this, $3 billion worth of subsidies have been allocated in an incentive program that reduces incentive levels over a ten year period. Cost-reductions in the maturing solar industry are anticipated to gradually overtake subsidies in making solar broadly affordable. It is worth noting that PG&E has already moved into step 4 of the program where incentives are at .26 cents per produced kWh. SoCal Edison is in Step 3 at .34 cents and San Diego Gas & Electric is about to move to step 3 which will also be at .34 cents per kWh produced.

EI Solutions is one of California's providers of large-scale solar power systems whose business strategy is to deliver clean, reliable, cost-effective energy solutions to business, government and institutional clients. EI Solutions brings together engineering, construction, capital financing, and project management skills.


"...a full fledged microprocessor that can track the sun costs only 20 cents.
That's down from $2000 just two decades ago."


Bill Gross, CEO and Andrew Beebe, President of the solar power high-tech launched the company in 2001 with a goal of making solar cost effective by using their backgrounds in computer technology to improve the process. Headquartered in San Rafael, California, engineering, project management, finance and administrative functions are based at the company's headquarters. EI Solutions also operates from offices in Pasadena, California, the home of its parent company, Energy Innovations. Energy Innovations emerged from the Idealab in Pasadena, CA as one of its noteworthy member startups.

"The real 'a-ha' moment on solar came when I was reading Moore's Law. One of the ideal ways to make solar more affordable is to concentrate sunlight. Until recently, microprocessors were too expensive. Now with 40 years of Moore's Law at work (technology doubles every 18 months…), a full fledged microprocessor that can track the sun costs only twenty cents. That's down from $2000 just two decades ago. This has revolutionized personal electronics in computers and cell phones but until recently had not been applied to energy," explains Gross in an interview with Worldchanging.com.

"Results will be felt much more in 10-20 years than tomorrow, but strategies for reducing the price of solar electricity needs to be worked on today.

"First, make silicon cheaper by scaling production of silicon, robotizing more, make it thinner so there's less waste. But prices are only coming down 3-4 percent a year based on these strategies.

"Second, find alternatives to silicon that can be mass produced.

"Third, use less silicon by concentrating the sunlight and use 100 times or 500 times less. This is Energy Innovations' strategy. We use high efficiency semiconductors and concentrate sunlight as much as possible. We are not first to try to concentrate sunlight but we are making systems to do it compactly, reliably, and inexpensively."

"One other aspect of EI Solutions' cost effective strategy is the low profile tracking concentrator that's roof mountable. All other track concentrators need to be pole-mounted into the ground. EI's low-profile, fully-assembled unit is manufactured in China at a much lower cost and is easy to mount in just a few minutes," he explains.

Google Photovoltaic Solar System

System Size:
1.6 MW

Energy Output:
2,611,719 kWh per year

Savings:
$393,000 + annually

Results:
C02 emissions reduced by 3.6 million pounds/year (equivalent to 4.28 million car miles/year)

READ MORE...

The California Solar Advantage

California is a hotbed of solar innovation because the state has good sunshine and high demand for electricity. And a lot of pollution to resolve.

Innovation is also a strong part of the California culture. EI Solutions is nearing completion on the 1.6 Megawatt solar "power plant" at Google's Mountain View campus. Google requires an enormous amount of electricity to power the computers and servers it uses to run its information business. The company wanted to find a way to reduce energy costs at its California "Googleplex," as well as make a statement in support of clean energy.

The variable size of solar installations make them appropriate for almost any business that wants to off-set their traditional grid-fed energy consumption. EI Solutions specializes in large commercial installations, but 10,000 square feet of roof space and 100kW systems are the starting points for their business model of delivering highly-engineered systems.

"Customers quickly get involved with their energy footprint when they go solar," noted Sara Hammes, Sr. Director of Marketing for EI Solutions. "One example is Seghesio Winery. This established winery tended, like most agricultural businesses, to concentrate on their core business -- growing grapes and making wine. They had no easy way to monitor their energy consumption. Now they have access to information and can make informed maintenance decisions that affect their energy efficiency. And now that they are a "power producer", they have developed a greater consciousness of how energy consumption affects their business and the environment in which they operate."

The marketing advantage of solar energy is that a significant system can be a show stopper for clients and visitors. The winery staff is able to share a lot of education about solar and how it works. "We often suggest putting in a kiosk for customer education," says Sara. "Kiosks help deliver great information and reserves staff time for answering more complex customer questions."

Seghesio Winery Solar System

The facility's monthly power bill has been cut in half. The company has been so pleased with the energy savings that they plan to invite EI Solutions to add a second solar power array, atop the new fermentation facility the winery will be building in 2007.

Location:
Healdsburg, California

System Size:
130 kW

Energy Output:
236,471 kWh per year

Savings:
$49,819 annually

Results:
C02 emissions reduced by 329,359 pounds/year (equivalent to 387,883 car miles/year)

READ MORE...

The Solar Power ROI

The conventional perception about solar is that it's just too expensive. But with today's perfect storm of high energy prices, more frequent heat waves, tightening regulations and demands of increasingly aware consumers -- solar has become a strategic advantage. Companies are starting to look at solar installations as an investment rather than a project. They consider paybacks in terms similar to leasing vs. building their own building. They look at brand value. And they look at ROI (return on investment) and IRR (internal rate of return)… and apply capital budgeting tools.

"Many major energy efficiency investments have 3-to-5 year paybacks. They require maintenance or they begin to degrade. An example is a high-efficiency HVAC unit. If it isn't maintained with cleaning and belts, etc., it gradually loses the efficiency gained. Most people don't figure maintenance into the equation," Sara explains.

Solar doesn't have much maintenance if it is properly sited and installed. "Clean it a couple times a year to remove dust. There are no moving parts. Inverters need to be replaced every 15 years. They can be a fixed installation on the roof…out of the way. Just keep it shade free," she adds.

The Solar Power Fit for Your Company

Factors that determine returns for a solar system include:
  • Building orientation and roof accessibility
  • The amount of shade
  • Ownership or long-term residency
  • Roof structure to hold the weight of the solar panels
  • Special cases provide low electricity rates that could decrease the appeal of solar

EI Solutions, like many of the innovators in the solar industry, has taken an active role in writing solar legislation. They have a regulatory specialist on staff who actively helps shape regulations and keeps abreast of the constantly shifting regulatory conditions and incentives that affect client installations. "Incentives change with the mood of the state or the country," Sara notes. "Public consciousness can greatly affect what legislation gets passed. The SGIP (Self generation incentive program) came along. Then through the Million Roofs Initiative we inherited the California Solar initiative. At the federal level there's the Federal Tax Credit -- which is currently under review. Policies are constantly shifting!"

Solar Incentives, Regulations...and Shifts in Demand

Solar energy is one of our state's most abundant - and least utilized - renewable resources. As part of Governor Arnold Schwarzenegger's Million Solar Roofs Program, California has set a goal to create 3,000 megawatts of new, solar-produced electricity by 2017 - moving the state toward a cleaner energy future and helping lower the cost of solar systems for consumers. The California Solar Initiative offers cash incentives on solar systems of up to $2.50 a watt. These incentives, combined with federal tax incentives, can cover up to 50 percent of the total cost of a solar system.

Commercial incentives are designed to be built out in a ten-step program, with each step having a dropping dollar level as it is subscribed to. As incentive levels drop, the market matures to fill in the difference. "The funds are being depleted very quickly," Sara notes. The program is very popular and the demand wasn't clearly understood."


"This is the perfect storm of opportunity."


And that's just government regulations. On the other side of the equation there is a raised consciousness that is bringing the issue of energy conservation and distribution to a national level. Last summer's "Inconvenient Truth" increased knowledge about climate change. And California's 2006 summer heat storm augmented other sources of information…people were living it!

Add to these factors, increasing international competition and companies are feeling the pressure to both lower prices and distinguish themselves from the competition. There is a confluence of market drivers driving change at the current time. It is creating the "perfect storm of opportunity." With federal and state incentives, and a shortfall of supply taken care of -- this is a great time to deploy solar.

Solar installations are growing in Northern California more than Southern for several observable reasons. The PG&E rate structure is designed to be more advantageous for solar installations. The general interest of the population is also stronger in the Northern half of the state -- but that is changing rapidly. "We should see more in SoCal because there's so much building in the Inland Empire and the desert. SoCal also has better climate for solar. And consciousness is also catching up in the region."

Some alternative energy players rise and fall. With the free source of sunshine in California, solar promises to have a long lifespan -- especially if innovation successfully brings costs down so that systems develop competitive payback returns for commercial installations. It's not always about the money -- but that's usually a big factor in business decisions!

CONTACT:

Sara Hammes
Sr. Director of Marketing for EI Solutions
626-685-4958
130 West Union St.
Pasadena, CA 91103
www.eispv.com
sara@eispv.com

SOURCES:
The California Energy Commission has additional background and resources for their parallel New Solar Homes Partnership, at www.gosolarcalifornia.ca.gov.

Interview with Bill Gross was conducted by Jonathan Greenblatt, read the complete interview at Worldchanging.com



Edited by Carolyn Allen, owner/editor of California Green Solutions
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