The opening of SunEdison’s new 9.1MW solar PV power plant in Canada exemplifies the “drastic changes” ahead for the North American solar PV market, as interest intensifies from utilities as well as the vendor partners and suppliers pursuing their business, according to one analyst.
by James Montgomery, news editor, Photovoltaics World
October 23, 2009 – The opening of SunEdison’s new 9.1MW solar PV power plant in Canada reflects a confluence of factors from financing and incentives to increased interest from utilities — which together are poised to “drastically change the nature of the PV market in North America,” according to one analyst.
The 90-acre “First Light” site in Stone Mills, Ontario — jointly developed by SunEdison and SkyPower, financed by Nord/LB Group, and spurred by Ontario’s Green Energy Act — incorporates ~126,000 ground-mounted thin-film PV panels. It started sending energy on Sept. 30 to Hydro One, the region’s largest electricity transmission/distribution company; first-year expectations are for output of >11.5M kWh (enough to power ~1000 homes) and a projected 210M kWh over 20 years (42,000 homes).
Besides the promise of renewable energy for thousands, the SunEdison plant represents “a harbinger of utility projects to come in North America,” according to Alfonso Velosa III, research director at Gartner, in a recent research note. The solar PV market’s original focus was on residential and corporate projects, installs ranging in size from ~1kW to 3MW that live on the end-user side of the equation, he notes.
But growing interest from the utilities (and the scale of those potential projects) changes the game, shifting the market from an end-user-owned model toward one that is utility-owned/controlled, with a mix of central and utility-controlled plants ranging from 10-20MW up to a full gigawatt in size. “A large number of financing deals” have been publicized recently, showing the will from companies and supporters to pursue PV solar projects, Velosa noted.
Solar independent power producers (IPP) including SunEdison are hot to tap into utilities’ growing interest in solar power in the US and Canada, particularly big ones including Duke Energy and PG&E — and traditional IPPs are increasing their focus in this area too, according to Velosa. This focus from IPPs, as well as pressure on utilities to add renewable energy sources to their offerings, “is about to drastically change the nature of the PV market in North America,” he writes.
Velosa expects to see more collaboration “up and down the value chain” in pursuit of the large utility-scale projects, and even more PV specialization in certain geographic regions leveraging relationships with local utilities and public utility commissions, Velosa notes. There will still be a large and attractive market for end-user-hosted PV systems (especially given their shorter lifetimes), “but the big animals whose steps you can start to hear are the utility customers and the traditional IPP firms — and their feet will change the dynamics and relationships between the PV vendors, the solar IPP firms, and their engineering, procurement, and construction (EPC) partners.”