Pedram Mokrian of VC firm Mayfield Fund organizes a semi-regular meeting of energy professionals and investors under the aegis of Young Professionals in Energy (YPE). Although I don't qualify for at least one of the letters in that acronym, I was privileged to attend the most recent forum on Balance of System (BoS) issues in the photovoltaics market.

Contingent on me bringing breakfast for the attendees.

Anyway -- the well-fed attendees represented a who's-who of thesolarelectronics, inverter and PV panel industry including First Solar, Suntech, Advanced Energy, SolarCity, SunRun, SPG Solar, Tigo Energy, eIQ, Array Converter, Enecsys, and others.     

I gathered two important takeaways from the meeting:

  1. The big U.S. residential solar installers, solar leasing, and residential PPA companies are not entirely comfortable with the new breed of distributed electronics, be they microinverters or DC-to-DC approaches. The hundreds of thousands of microinverters shipped by Enphase and tens of thousands of units shipped by Tigo and SolarEdge have gone through smaller installers in the long tail. That could change soon.  Note that the market share for smaller installers is gaining at the expense of the larger firms.
  2. The solar electronics firms, whether central or distributed, want to avoid the dollars-per-watt commodities race that their PV module brethren are engaged in. They would prefer to highlight other values and metrics.

Ed Heacox, the VP of Solar Inverters at Advanced Energy, made a point that became a bit of a refrain at the meeting. That is -- we (the industry, the press, and Wall St. analysts) are too focused on dollars-per-watt while we should be looking at LCOE or dollars per kilowatt-hour.

Heacox urged getting away the commodity-accelerating $/W metric and focusing on full energy harvest, uptime, reliability, and cash flow over time. Most every electronics vendor at the table echoed this sentiment.

There's little disagreement with Heacox from me on this, and I will look to highlight those metrics -- but I'd hazard a guess that dollars per watt and the cost of financing remain the major factors in LCOE figures despite all other variables.

Michael Schenck, the Manager of Advanced Power Conversion at First Solar, said, "Advanced technology doesn't play well with utilities," when asked about his firm's comfort with panel-level electronics like microinverters and DC-DC boost products. Schenck said that First Solar would need to see a lot more details and quantification before making the leap to distributed electronics. He also noted that First Solar was not developing their own inverter.

Ben Tarbell, the VP of Products at solar installer and financier SolarCity, noted that the firm has installed more than 10,000 systems. He claimed that having module-level data was valuable but not necessary, and that we can't focus solely on the hardware. Echoing Heacox, Tarbell said, "It comes down to dollars per kilowatt-hour." Solar City is the largest residential installer in the U.S. and has tested distributed electronics but has not installed these new systems in any volume. Tarbell continued, "It's going to take a while before people become comfortable."
 
Matt Eggers, the VP of Operations at SunRun, focused on the soft costs of installation and noted that although they're "excited" about new BoS hardware, they too have refrained from switching over to distributed electronics. Eggers said, "We're a PPA company and the warranties have to be there."

Jason Kaminsky, SPG Solar's Manager of Advanced Technologies, confirmed that his firm has not yet switched to these advanced technologies.
 
Mokrian, the organizer and investor (Mayfield is an investor in SolarCity) identified a theme of juxtapositions: AC vs. DC, utility vs. rooftop, information (data) vs. insight, bankability vs. familiarity, and installer market pull vs. module maker integrated product push.
 
Other topics included questions about the warranty for an AC module (ACM) with an integrated microinverter. Is that warranty wrapped around the entire ACM and backed by the module manufacturer? Can an integrated microinverter survive the cost pressure placed upon it by a Suntech or a Yingli?

Restating the theme: be on the lookout for one of these large residential installers to approve and deploy distributed electronics. That will signal the real mainstream arrival of this new solar architecture.

And while we're on the topic of microinverters -- here's a widely circulated but unsubstantiated rumor: SMA, the world's largest manufacturer of central inverters is due to introduce a microinverter in the next six months.