Solar projects are complex, with multiple parties and contracts to comply with, and the simplicity of an overview approach offered by an asset manager might appeal to some owners. Global events company Solar Plaza visited Sydney in June to host the first Solar Asset Management Australia conference, where participants from the industry spoke about the importance of certainty and compliance in delivering and maintaining projects.
A panel of experts started the event by defining asset management as distinct from the many contractual relationships a developer will have to negotiate and rely on throughout the life of a clean energy plant.
The panel, above from left:
- James Pagonis (moderator), director, Powerhub
- Frank Teofilo, senior director energy services and O&M, First Solar
- Alba Ruiz Leon, managing director, Innogy Renewables
- Mike Rand, managing director, Blueshore
An asset will have an array of contracts the SPV will be signing up to, said Mike Rand at asset management provider Blueshore, with an EPC, O&M provider, PPA signatories, registration with AEMO, health and safety, development approval, etc. “There are probably 20 contracts that are going to affect your project,” he said. “The role of asset management services is to sit as representative of the SPV to be the counterpart to all of those contracts.”
Trust and performance are the two pivotal factors in play, Rand said. A project must be compliant and deliver as promised. This means following the threads to ensure all other parties that contribute to contracts – and there may be many – are fulfilling their obligations. To meet these expectations, an asset manager must have access to robust sources of data. As plants get bigger, the task gets harder.
Data and more data
“If you look at a typical 100MW [solar] plant in Australia, you’ve got roughly 300,000 modules, about 10,000 strings, about 500 combiner boxes, about 50 inverters, about 20 transformers – each of those giving data points,” Rand said. “That’s all data flowing in that is valuable for enhancing performance.” Contract and performance data is the “centre point” for proper asset management.
Operations and maintenance services firms are harnessing the power of data, said Frank Teofilo of First Solar. “When you’ve got a portfolio of plants [under management] you can actually see trends, and if you build that knowledge from those trends you can [achieve] outcomes across a portfolio,” he said. Participants who can leverage international connections or projects in other regions will have deep reserves of experience, he said. “That’s the knowledge base international markets bring to Australia.”
The clean energy revolution didn’t start yesterday, Alba Ruiz Leon of Innogy Renewables reminded the audience. “We need to think of asset management as something old, because it’s nothing new,” she said, alluding to high-risk industries where the asset management role is long-established, including aerospace and nuclear.
“We do not need to re-invent the wheel. Can we look at what has already worked for those assets? Can we leverage that existing information, can we leverage those asset management work practices?” she said. “There are already well demonstrated methodologies … these industries use.”
See risk in a clear light
As the market matures, the risks will fall to the parties best equipped to manage that risk, said Teofilo. “At the moment the risk is being put to certain areas of the market where there is not enough maturity to understand that risk.”
With assets scattered far and wide across Australia a lot of revenue can be lost if maintenance is haphazard, especially when it comes to replacing parts. “The biggest risk is this market is the revenue lost when you have failure,” said Rand. “Monitoring is absolutely imperative, because you can identify when those failures are going to happen or diagnose what the failure is before you are on the site to try to fix it.”
For owners to squeeze maximum value out of an asset and the contacts it is supported by, Rand said in conclusion, they must understand how a plant is performing. “That’s the role of an asset management services provider as distinct from the overall roles and responsibilities of asset management, which includes operations and management.”
Speaking for First Solar, Teofilo said, “If there is a true combined view of what the outcome is … an O&M provider can provide such insights and be accountable for [them].”