Solar Options: Which One is Right for Your Business?
CommercialDec 13, 2022
With the billions of dollars of incentives for renewable energy in the recently passed Inflation Reduction Act, you may be looking to learn about the advantages of solar energy or at least to get a refresher.
Very simply, solar cells convert radiation from the sun into electricity. However, how and where the solar cells are installed can make a big difference in the productivity and economics of your solar project.
Solar Systems: Fixed vs Tracking
Fixed solar systems are like their name implies, fixed. The solar cells are stationed securely in place, whether on the ground or to a structure such as a roof. Ideally, these fixed systems are facing south (in the Northern hemisphere) in order to maximize the cells efficiency in converting radiation into electricity.
Tracking systems or ‘trackers’ follow the sun throughout the day. Trackers are much more efficient at converting radiation into electricity than fixed panels since they spend more time being perpendicular or nearly perpendicular to the sun’s rays. One cannot fit as many tracking panels on a piece of land as fixed panels. This is because more room is needed for the solar panels to rotate as the trackers follow the sun on its path across the sky. However, the increased efficiency more than makes up for the reduced number of panels.
One item to keep in mind is that trackers require flatter terrain than fixed systems. It is not uncommon for very uneven land to cause the overall economics to favor a fixed system over a tracking system. In these cases, the site preparation costs needed to accommodate the tolerances for trackers outweigh their efficiency gains.
Behind the Meter vs In Front of the Meter
Electricity generated from solar will have differing impacts on your electricity costs depending on which side of the meter it is. Behind the meter, for those who are unfamiliar with the term, simply means that it is on your side of the utility meter. Electricity that is generated behind the meter is consumed by your operations rather than being sent out to the grid.
There are a couple of major advantages that behind-the-meter solar generation brings. The first advantage is that every kilowatt that your facility generates for itself is a kilowatt that your facility will not need to buy. Secondly, behind-the-meter solar is usually very effective at reducing peak demand. Electricity billing varies greatly across the United States. Most rates, however, have charges that are determined by your facilities peak usage during certain periods of time. Most, if not all of these peak-determining time periods are in the summer – exactly when solar is at its most productive.
Excess electricity that is generated behind the meter can, in theory, go out to the grid to be sold and used elsewhere. However, in most cases, this is not practical and usually avoided for commercial and industrial applications. Adding battery storage to a behind-the-meter solar field is one option of several this is more practical than sending the electricity out to the grid.
Front of-the-meter electricity from solar facilities goes directly to the grid. These tend to be much larger and are managed more like a power plant than an accessory to an industrial or commercial site. Currently, many regional transmission grid operators, such as PJM, have significant delays for interconnecting new generation to the transmission system, in some cases up to 7 years depending on when the application was submitted. While behind-the-meter applications require the local electric utility to study the potential impacts to their distribution systems, the timeframe to get these results back is normally 90-180 days. If timing is important to when you begin purchasing renewable energy, behind-the-meter solutions might offer a more expeditious path to meet those goals.
Ground Mounted vs Structure Mounted
Solar panels don’t really care where they are located. As long as sunlight can reach the panels, they will generate electricity. This means solar panels can be put on the ground or on top of structures, such as roofs.
Ground mounted solar projects tend to deliver electricity at a lower cost per kW generated than those mounted on structures. Scale and infrastructure are two of the most compelling factors leading to the increased costs.
Solar projects are no different than other projects in that economies of scale have an impact on the total cost of the project. Every solar project will have mobilization, engineering, permitting costs among others that become a smaller and smaller percentage of the overall project budget as the scale of the project increases. Ground mounted solar projects often cover acres and acres of land. A 10-acre solar field is not uncommon at all, whereas 10 acres of roof top space is indeed very rare.
Structure mounted solar projects, particularly projects on pre-existing structures have more challenging infrastructure questions to answer that ground mounted projects do not. Common questions might be, can this roof safely support the added weight of hundreds of solar panels, are these parking canopies aligned in such a manner for optimal solar radiation collection, etc.? As you can imagine the answers to these questions increase the cost per kW of electricity generated.
However, structure mounted solar projects should not be discounted altogether. Often times, the land for ground mounted solar is simply not available, but buildings are. Putting solar on the roof of your warehouse, for example, may be the only option available, if your company wants to generate carbon-free electricity from the sun.
It may feel as if there are an endless variety of options, factors and incentives to consider when putting in a solar field. Rest assured; AEP Energy’s Onsite Partners team of professionals has seen, installed, maintains and operates just about every imaginable commercial and industrial solar configuration available. We look forward to working with you on your own unique solar journey.
Interested in learning more?
If you are interested in learning more about your solar options, contact your existing AEP Energy Sales Representative or click here to request more information.
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