Solar Partnership

REC and Summit Power recently partnered to develop utility-scale photovoltaic projects in the US market. Dana Zentz joins us to discuss their ambitions for providing solar systems to utilities.

Explain what this new partnership between REC and Summit Power is about.
Dana Zentz. We are very excited about teaming up to promote solar as a resource for US utilities. REC is a major global player in the solar industry that possesses the most vertically integrated value chain in the industry. As a result it is able to systematically reduce costs across all of REC’s business lines – silicon, wafers, cells and modules. The REC-Summit Power partnership combines this with Summit Power’s extensive development experience – in total 6000 MW of traditional and renewable energy technology – giving the partnership powerful capabilities in responding to utilities’ needs as they want to go solar.

Why is now the time for utilities to go solar?
DZ. During the last six to nine months in particular a confluence of events is pushing solar energy to the forefront. Utilities increasingly face hurdles to the implementation of non-renewable energy sources, as well as calls from both governments and customers to promote renewable energy.

At the same time, the costs of solar energy are coming down at an accelerated rate. The solar industry has over the last 3-4 years also reached a greater level of maturity, which means both greater technology performance and lower execution risks. All of these things make now a great time to go solar.

How are solar costs coming down?
DZ. Since the demand for renewable energy is here to stay, the challenge for solar is to become as cost-effective as other clean energy choices. This is happening already as the price and performance of PV modules rapidly improve. Indeed, PV is already in the cost range of conventional generation options in many instances. It also is notable that as much as 50 percent of solar system costs can arise from Balance-of-System (BOS) components, which we are focused on driving down significantly through replicating and scaling proven solutions. Finally, Summit has pioneered a low-cost project-financing model for wind development that can lower costs further.

What do you think utilities want to see in a solar resource?
DZ. In addition to lower costs, utilities certainly want to see reliability and minimized project execution risk. For this utilities need experienced project development professionals that understand the utility business model and focus on scalability and standardization. Our team, which has developed 6000 MW of generation projects in the US using traditional and renewable generation technology, is very close to finalizing development of a standardized reference PV power plant, which can be replicated quickly and cost effectively.
 
We also intend to employ an ‘urban infill’ strategy for project siting, which will move power generation to relatively small sites close to loads and thereby increase reliability benefits to utilities while minimizing transmission costs and development risks associated with massive central station power projects. This approach has clear environmental as well as cost reduction advantages.

Lastly, utilities need load-matched resources. Solar can provide a more predictable and peak load shaped generation profile than wind, for example.

What are your prospects for long-term growth?
DZ. We are optimistic. The 80 percent growth in demand we saw in 2008 can only continue to result in the dropping of market prices and structural changes in the industry as competition intensifies. We are confident to succeed through our REC-Summit partnership, and we have already received very promising feedback from utilities with which we have discussed project opportunities.

For more information contact us at 1.877.687.7786 or www.summitpower.com/solar.

Dana Zentz is Vice President of Summit Power and has over 25 years of active involvement in the energy industry. He founded and managed Inland Energy Consulting, Inc. Inland Energy assisted utilities, independent power producers and energy merchant firms with strategic and commercial matters related to power and natural gas supplies and energy project management. He leads marketing efforts for the REC-Summit partnership to western US utilities.