Orange is the New Green (Button)

Getting solar project partners to speak a common data language should reduce soft costs

The biggest obstacle to the mainstreaming of solar energy is not, John Previtali says, its cost or intermittency; it’s data management. Previtali is Vice President for Environmental Finance at Wells Fargo, where he employs 15 people full time to analyze the data the bank receives on projects seeking investment.

“The issue is that data comes into us in an incredible disparity of different forms, including PDFs, Excel spreadsheets and Word documents,” he said. “You have this huge jungle of documents, and then you have to have people manually hunt and peck through that data to pick out what they need and then validate that that data is correct.”

This status quo is not tenable, for practical or business purposes, Previtali says.

“We have had 50-percent turnover over the past two years among that staff,” he said. “These people are quitting because this work is so monotonous and boring. And these are people we rely on to monitor the actual performance of these funds and — in many cases — make very important decisions about these projects.”

Previtali was speaking at Solar Power International (SPI) in Las Vegas earlier this month, where he and other solar industry executives were unveiling the Orange Button initiative, a federally funded project aimed at taking the drudgery and high costs out of solar project data management.

The highly technical initiative can best be described as a digital dictionary of data fields used to streamline and improve the security of data collection, management, exchange and monetization across the solar value chain.

For example, for financial institutions such as Wells Fargo, Orange Button provides standardized data formats covering project finance, portfolio finance, securitization, insurance and construction finance. The goal is to get everyone speaking the same language to make it easier for banks to fund and manage solar projects, thus encouraging more efficient and cost-effective financing of distributed energy projects.

Soft Costs Are the Biggest Costs

Why this is so important is that even as solar costs overall continue to drop, so-called “soft” or non-hardware costs remain stubbornly high. One of the big stories coming out of SPI was the announcement from the Department of Energy’s SunShot Initiative that it had reached its goal of cutting the cost for utility-scale solar below $1 per watt three years ahead of schedule. But, according to a report from the National Renewable Energy Lab, soft costs continue to make up as much as 60 percent of solar prices — especially in the residential and commercial markets — and data management can account for half of that total.

At Wells Fargo, the real-life impacts of that imbalance have been significant, according to Previtali. The amount of paperwork involved in solar project data management is so burdensome that the bank has shifted attention from distributed generation to utility-scale projects, he said. More to the point, in 2014, internal auditors were forced to temporarily shut down his division because it was unable to effectively manage the data required to monitor the performance of its projects.

Aaron Smallwood, Senior Director of Technical Services for the Smart Electric Power Alliance (SEPA), said industry-wide adoption of the initiative’s data standards could have a dramatic impact on the time, cost and accuracy involved in managing solar data.

“Using a standardized solar data taxonomy with defined terms and units of measure will put pressure on the total cost of solar by lowering soft costs,” he said.  “This will increase accuracy and make data more timely.

“Currently, there is no standardized solar data format,” he said. “That’s what Orange Button is going to do.”

It takes a team

Smallwood and SEPA are part of a consortium of organizations that have been working on Orange Button since it was first launched by SunShot in 2016. Its original, somewhat unwieldy, title was “Solar Bankability Data to Advance Transactions and Access.” The Orange Button moniker was aimed at creating a brand for the initiative similar to other data streamlining efforts such as Green Button, the Energy Department program that established data standards for utility customers to download their electricity usage information.

In addition to SEPA, other Orange Button partners include the SunSpec Alliance, kWh Analytics and the National Renewable Energy Laboratory (NREL). While collaborating on the project, each organization has a different area of focus and responsibility.

SEPA’s primary focus was on working with a broad group of industry stakeholders to define the industry requirements that would serve as the foundation for the Orange Button taxonomy — that is, the actual system of data standards classifications and definitions. The taxonomy is being developed by the SunSpec Alliance, while kWh Analytics is creating cloud-based data translation tools that can translate legacy solar data into Orange Button compliant formats to make adoption easier across the sector.

Finally, NREL will develop the Solar Data Exchange Platform, a website that will provide a comprehensive solar data catalog, and easy access to common data standards, a means to combine data, and search functionality. The goal here, said Kristen Ardani, Solar Analyst and soft cost reduction program lead for NREL, is interoperability.

“Making data interoperable is very important for reducing soft costs and transaction costs for the industry,” Ardani said.

Less customization = lower costs

A series of sessions at SPI constituted the initial public unveiling of the Orange Button data standards and the launch of a 30-day period for industry stakeholders to review and comment on them. A crowd of solar industry software developers, financiers and construction representatives heard from Previtali, Smallwood and other project partners about the current status of Orange Button, the nuts and bolts of how the data standards work and the experiences of early adopters.

A key component to those data standards is the XBRL (eXtensible Business Reporting Language), which is the foundation for the Orange Button dictionary of terms.

“XBRL is a standard that’s widely used around the world,” says Michelle Savage, Vice President Communications, XBRL US, Inc. “It has been adopted for financial reporting in over 60 countries, and over 10 million public and private companies report their financial information to government authorities using XBRL.”

The Orange Button project then augments that data with solar-specific terms from existing solar data standards.

“When you think about financial information, in order to understand what you’re looking at you need to understand if the data is in euros or U.S. dollars, or yen, you need to know things like measurement units and time periods, and you need to know whether values reported are in thousands or millions.” Savage said. “There’s important information that needs to be transported along with every data point in order for the end user to know what they’re looking at.”

Skip Dise is Lead Project Manager for Clean Power Research’s SolarAnywhere project, an early adopter of Orange Button. “The economic case is that the less we have to customize our software interfaces, the more we can reduce our own costs and sell more software,” he said.

For example, he said, Orange Button’s data standards could help utilities reduce the time it takes them to interconnect solar projects to their distribution systems. Reducing interconnection times has been a key issue for solar market growth and customer satisfaction.

“At SPI, the most impressive part of the day was seeing that multiple solar software vendors were able to easily integrate the Orange Button taxonomy into their software and services, not in months, but in weeks and sometimes days,” Smallwood said. “What that shows is that the Orange Button taxonomy can be easily adopted and integrated into a key space in the solar industry: software providers.”

Previtali also reported a positive impact. “Orange Button can streamline the data exchange between our partners, our vendors, our operators, our advisors and ourselves in two ways,” he said. “They can give us documents we can actually read with that data in them, but then our business machines can use the metadata in these documents so our databases can be populated automatically.”

In addition to Clean Power Research and Wells Fargo, other early adopters include Sunnova Energy Corporation and Oracle’s Enterprise Performance Reporting Cloud Service, which is using the Orange Button taxonomy for its disclosure management capability.

Getting to 60 percent

The Orange Button Initiative was launched with a big-picture goal of gaining a cross-industry adoption rate of about 60 percent. The 30-day review of the data standards announced at SPI is one of the steps that will provide momentum toward that target.

For more information, or to sign up to participate in the review process, go to the XBRL website. An Orange Button Taxonomy Review Webinar is scheduled for Sept. 27.

“Standardizing data collection is a critical means to reduce the soft costs of solar financing,” said Tom Tansy, Chairman of SunSpec Alliance. “All solar energy stakeholders owe it to themselves and their businesses to review the standards and give us feedback. Every participant has a chance to influence the final standards that will be the industry norm in solar financing. That will benefit participants’ companies and ultimately the entire industry.”

Michael Penwarden is Vice President of Hirsch Media, a marketing agency serving the cleantech industry. He can be reached at [email protected].