Multiple strategies needed to cut solar interconnection times

By  Kristen Ardani, Miriam Makhyoun and K Kaufmann

When utility customers decide to go solar, the question frequently uppermost in their minds is — “How long will it take before my system is up and running?”

As photovoltaic (PV) solar panels are installed on more residential and commercial rooftops across the country, utilities have found that answering these questions — called interconnection requests — can draw on a range of their operational capabilities and personnel. Applications must be checked for completeness, projects screened for compliance with technical requirements and, in some cases, impact studies undertaken, all while maintaining communications with customers.

An industrywide focus on reducing the so-called soft costs of solar installation, which are now a major part of the upfront costs for rooftop systems,  has also intensified the drive to streamline interconnection.

A recent report from the Solar Electric Power Association (SEPA) found that utilities may take from two weeks to two months or more to process and approve solar interconnection requests.

Source: Solar Electric Power Association

To gain a better understanding of the interconnection process — and help utilities and installers cut associated time and costs — the National Renewable Energy Laboratory (NREL), along with SEPA and other organizations, have launched the Distributed Generation Interconnection Collaborative (DGIC). The initiative is aimed at fostering research, innovation and information-sharing on interconnection policies and practices, which in turn could help utilities and policy makers come to more informed decisions as the amount of solar on the grid increases.

With a cross-section of industry members — utilities, regulatory bodies and PV solar companies — the group’s activities are “stakeholder driven, with research and discussion topics chosen by DGIC participants,” said Courtney Kendall, communications manager for NREL, who introduced a Jan. 21 webinar on the collaborative and its recent research efforts.

The group is likely to tackle a mix of process and technology issues going forward, she said. For example, plans for 2015 could include a study of how the addition of storage and smart inverters to solar installations might affect interconnection times and processes.

Started in 2013, the collaborative has so far produced the SEPA report, with an upcoming study from NREL soon to follow. Released in October, “Distributed Solar Interconnection Challenges and Best Practices,” summarized findings from SEPA’s survey of 64 utilities.

The NREL study — “A State-Level Comparison of Processes and Timelines for Distributed Photovoltaic Interconnection in the United States” — analyzes data from more than 30,000 solar installations, focusing on the time frames for specific steps in the interconnection process. It also provides state-level interconnection data for five states with active solar markets — Arizona, California, Colorado, New Jersey, and New York. 

A set-up for delay? Solar interconnection typically requires two separate but parallel approval processes, one by the local permitting authority — the United States has more than 18,000 such jurisdictions  — and the other by the utility.  Source: National Renewable Energy Laboratory

Key findings from the two studies were presented during the webinar.

● Both NREL and SEPA found that the average time for application review and approval for residential and small commercial systems was about one month — a figure that has not changed since 2008 — said research manager Miriam Makhyoun, a co-author of the SEPA report.  This average drops to less than two weeks for the 17 percent of surveyed utilities that have an online platform for interconnection approval.

● SEPA also found a correlation between completion times and the number of interconnection applications being processed. Among utilities receiving fewer than 500 interconnections requests per year, 41 percent had processed the applications within two weeks, Makhyoun said. By comparison, only 15 percent of the utilities receiving more than 500 applications per year had “nailed it,” she said, whittling down interconnection times to under four weeks.

With less than 5 percent of the utilities surveyed accounted for 78 percent of the requests processed, “soft-cost reductions resulting from improvements in interconnection processes can have a significant impact on the solar industry,” she said.

“With the rapid growth of solar — we’ve predicted 1 million systems by 2017 — it makes sense for utilities that may not have that much (solar) today to think of scaling their interconnection programs in the future,” she said.

Check out all SEPA’s recent research reports here.

● The NREL study looked at the entire deployment process — from  the submittal of interconnection applications and construction to the final permission to turn on a system — for residential and commercial solar installations of 50 kilowatts or less. While the study found that the average PV deployment, from start to finish, takes 63 days, the variations within that figure ran from less than one week to more than six months.

System construction represents the shortest part of the process, taking an average of two to four business days, depending on system size, said Kristen Ardani, a solar analyst at NREL and lead author of the study.  Even that low figure for PV construction may be an overestimation, Ardani said.

“The level of data we collected focused on the complete business cycle, from the day construction started to the day construction was completed, so half days’ work or actual labor hours were not captured,” she said.

At the other end of the spectrum, interconnection application review and approval were the most time-consuming steps in the process, requiring an average of 27 business days to complete, about the same as the four-week average found in the SEPA study. The NREL research suggests that states with regulations mandating specific time frames for interconnection might reduce overall project length.  However, several states have no mandated limits on interconnection times in place.

For installers, any delays in interconnection can result in lost time and revenues, she said. On the utility side, the rapid rise in PV installations and interconnection requests can add to workflow demands and the expense of application processing, while slowing down turnaround times.

Source: Solar Electric Power Association

● Both studies found that the most common challenges utilities face with solar interconnection applications are ensuring application accuracy and completeness, and communicating with customers. The top priority for consumers is having an interconnection process that is simple, fast, easily understood and well-communicated, Makhyoun said.

● On the utilities’ side, collecting information on system siting and technical specifications is of growing importance for purposes of both reliability and security. Two-thirds of the companies in the SEPA study are planning improvements to their processing of interconnection requests.  Utilities see a range of opportunities for innovation and improvement, from requiring utility approval of solar systems as part of the building permit process to finding better ways to explain insurance requirements for solar systems to customers.

One possibility brought up during the webinar’s question-and-answer session was a federal mandate requiring all utilities to have an online process for interconnection requests. Such a broad mandate does not exist or seem likely at present, Ardani said.

Collaboration drawing in all stakeholders — utilities, solar companies, regulators and consumers — might provide better solutions, said Makhyoun.

“There are constructive ways to deal with these problems that benefit both sides of the meter,” she said.

“A State-Level Comparison of Processes and Timelines for Distributed Photovoltaic Interconnection in the United States” will be available from NREL in the coming weeks.  Information on the report and the DGIC can be found on the collaborative website here. 

Kristen Ardani is a Solar Technology Markets and Policy Analyst at the National Renewable Energy Laboratory. She can be reached at [email protected].

Miriam Makhyoun is a Research Manager with the Solar Electric Power Association. She can be reached at [email protected].

K Kaufmann is SEPA’s Communications Manager She can be reached at [email protected].