Adopting data standards to evaluate solar asset performance and raise capital

Few companies are as deeply invested in solar energy output as sPower. With a portfolio of over 1.1 gigawatts, the Salt Lake City-based independent power producer is the largest private owner of operating solar assets in the US. Whether developing new projects or acquiring operational systems, sPower must evaluate performance, and performance models, while controlling for variables that can alter energy output, such as ambient temperature, shading, and intentional curtailment.

A performance engineering manager at sPower, Pramod Krishnani, participated in the International Electrotechnical Commission working group that developed an industry standard for performance evaluations. Krishnani and others also provided the classification system for solar performance evaluations to the Orange Button Initiative, a collaborative effort to reduce the cost of sharing solar project data. Any project developer or investor can freely access tools to collect or report performance evaluation data by joining the Orange Button implementors network and downloading the Orange Button data standard.

The performance evaluation is essential for asset owners wanting to obtain financing secured by future revenues, whether the asset is a solar project or another revenue-generating asset, like a golf course. If it’s a golf course, the players expect healthy grass on the fairways and the putting greens. A course that’s pockmarked with patches of dead grass will turn away golfers, driving down revenues. But it’s important to know what caused the grass to turn brittle and brown. If the culprit was unseasonably cold winter, investors may chalk it up to factors beyond their control and issue financing. If it’s a matter of substandard grass seed and fertilizer, they will be more inclined to withhold financing. Technical performance data provides the answer.

The same scenario applies for solar assets. If a system is underperforming, investors need to know the cause. They need to know if it’s related to a product defect, a system engineering and design deficiency, or just an unusual amount of cloud cover. What’s more, they need to know that when you adjust for weather-related variables, the system is still performing at its best.

At sPower, Krishnani correlates technical performance data with financial data to evaluate solar assets. sPower can report all this data to investors using the Orange Button data standard, as it has done for a multi-million-dollar bond financing deal with Citibank.