Everything You Need to Know About Solar and Storage in 2021
SMP 92: Expert’s Insights and Predications on Solar and Energy Storage with Paul Wormser
In this episode of the Solar Maverick Podcast, Benoy Thanjan talks with CEA’s Vice President of Technology, Paul Wormser, about everything from technology innovations in solar and storage, how the solar industry has been very resilient during the pandemic, forced labor legislation, energy storage trends and green hydrogen, and much more.
Podcast Transcript
Benoy Thanjan:
Hi, this is Benoy, your host of the Solar Maverick Podcast. I'm excited to have Paul Wormser. He's the Vice President of Technology at Clean Energy Associates and Paul, welcome to the podcast.
Paul Wormser:
Benoy, thank you so much. It's a pleasure to be here and to join you today.
Paul Wormser:
Yeah, thank you for being here and making time. And it's great to get your perspective on the solar industry with nearly 40 years of experience or 40 year career in solar, which is pretty amazing. And, you know, I enjoy it like in our, pre-interview your passion for the industry and hearing about your background and also perspectives on different things that are happening.
About Clean Energy Associates
Benoy Thanjan:
It would be helpful to talk more about Clean Energy Associates and your role within the company.
Paul Wormser:
Sure. Clean Energy Associates is an international technical advisory. This means that you can think of us as deeply passionate engineers who deal in solar and storage - not anything else - and we help clients with a number of technical issues. Among them, and what we're best known for is having our engineers inside of factories all over the world that are making modules, racking systems, inverters, transformers, and storage systems for clients all over the world.
Our clients tend to be long-term asset owners, or you might think of them as developers, IPPs and utility companies, literally all over the world, whether it's India, the Middle East, Europe, North America, the Pacific Rim... So that's our client-based geography.
Other than doing in-factory quality assurance work, we're also known for supply chain work. We are helping identify possible suppliers, conducting due diligence on the suppliers and on the products, and matching suppliers and products to our customer's needs at individual projects.
We'll also do downstream engineering. So if you are, for an example, a developer, and you want some preliminary design, our engineering team does preliminary design work. They'll look at the design options; they'll optimize the design of the system and give you a forecast of energy harvest. And on the other hand, if you have a project and you believe that the project is under-performing in some way, our engineering team will investigate and find out if in fact it is underperforming and what the cost might be.
How Have Manufacturing Supply Chains Been Impacted by COVID-19
Benoy Thanjan:
That's really interesting to hear. Can you talk about how Clean Energy Associates has been impacted by the pandemic and how, you know, manufacturing supply chains have been impacted either?
Paul Wormser:
You know, the solar industry has proven to be surprisingly resilient despite the pandemic. That doesn't mean that there have not been speed bumps, but the speed bumps have not been brick walls.
For example, the United States will deploy solar this year in fairly large numbers. In fact of the early phase of the pandemic suggested a tremendous hit, especially on the residential side. And I think the residential side has already recovered beautifully. Around the world, the pandemic had predicted possible major disruptions, but I think many of those disruptions were addressed and accommodated. So while there will be some spillover of projects into 2021, I think we're going to see the 2020 will end up being a pretty good year for solar overall.
In terms of some of the more minor disruptions, again that have been largely ironed out, there have been situations where factories have had to shut down or slow down for periods of time, either at the module level or even upstream. So that has caused some minor delays. But overall, again, what's really key here is the resiliency of the entire supply chain from raw materials all the way through project construction.
Scarcity of Raw Modules and Impacts on Module Pricing
Benoy Thanjan:
That's pretty amazing the resiliency, as you said, and to see that it hasn't been as impacted as people were initially predicting. Obviously everyone's always curious about like the pricing specifically, the pricing of modules, and I know you made a great point about, there's been some scarcity of raw materials. Can you talk more about what you're saying with module pricing recently, And what's been impacting that?
Paul Wormser:
So module pricing is affected by quite a number of things. There are technology innovations that often drive performance up and price down. There are supply and demand issues of a particular market, really having a strong demand for products like the US does, or tariffs that certainly impact pricing because they have to be absorbed by somebody.
Polysilicon Shortages
Paul Wormser:
And then there are potential disruptions and shortages. So one good example of that is that in mid 2020, the supply of polysilicon, which is the fundamental raw material for crystalline photovoltaics was disrupted. There were three different factories inside of China that each had disruptions. One of them was quite significant. And the result of that was that polysilicon pricing went up quite a bit and it's just beginning to come back down. But that disruption lasted for basically six months, and it'll continue a little bit more again, the pricing is going down, so that'll settle out, but that's been one of the issues.
Glass Shortages
Paul Wormser:
Another issue as an example is glass and glass has been in short supply, which has resulted in glass pricing going up a fairly substantial amount. And that cost increase is starting to get passed along to customers who are buying modules.
The shortage on the glass side is driven by a couple of factors. One, overall production of modules has been strong, like we said before because of the resiliency, but also the take-up by the market of bifacial modules has been terrific, and a bifacial module, more often than not, will have glass on both sides of the solar cells, not just the top. And that means more square meters of glass are needed.
And then I think another element there that contributes to the glass supply shortages that normally you would think that if there's great demand for glass, more glass factories are going to be built. And while that's true to some degree, there are also some limitations right now where most of the glass is made in China in terms of building new factories or energy intensive industries. So when you take a look at the overall strong market demand for solar in general, the take-up for bifacial modules, the incentive or disincentive structure around building new glass manufacturing plants, and then last but not least, the larger wafer and cell sizes that we're seeing, which demand wider and lighter glass, which may not be so easy for some factories. All of these are contributing to what I see as a temporary, but material, disruption in supply, or to put it differently, a temporary, but material change in price.
Benoy Thanjan:
That is a great way of summarizing a lot of complicated and different sort of variables that impact panel pricing. And that's really like a great example of how to explain it and what were the components of it.
The Biden Administration and Solar Panel Tariffs
Benoy Thanjan:
You mentioned, Paul, like about tariffs and obviously, you know, tariffs are now on solar panels in the US, what do you think is going to happen with the tariffs and a long-term with now you had administration that's more, I guess, favorable to clean energy. So it's simple way to put it.
Paul Wormser:
There are lots of tariffs that apply to solar depending on where it's made and what the technology platform is. In general, we can probably divide tariffs into the following groups.
Anti-Dumping Tariffs
Paul Wormser:
There's the anti-dumping countervailing duty tariffs that are applied towards modules or cells made in China. And those tariffs get revisited typically on an annual basis. And the tariffs that are in place at the moment make it virtually impossible to think of China as the supply side for modules coming into the US. The tariffs are just too high to make it work.
Section 201 Tariffs
Paul Wormser:
Then there is the section 201 tariff, which still has another two years to run. And that tariff had been expected to go down to 15% in February, but it was recently changed by the president Trump to 18%. So that has an impact on pricing for modules coming in.
Section 301 Tariffs and Currency Manipulation
Paul Wormser:
And then there's a section 301 tariff that applies also to product from China. What's interesting is that these tariffs are potentially under review in the future, by the new president, with some limitations in terms of what his authority might be. There's an investigation, for example, going on to currency manipulation in Vietnam, and there's already been some precedent setting about the analysis of currency manipulation and how it might affect tariffs on certain goods. This could ultimately affect module pricing for modules that are produced in Vietnam and coming to the US. There was no indication of that at the moment, but by the time this podcast broadcasts, we may know more.
Forced Labor in Solar Supply Chains
Benoy Thanjan:
That's really helpful, and I appreciate you breaking down the different components of the tariffs and what could impact it. Can you also talk about forced labor and sourcing from equipment manufacturers? Can you go into a little bit about that because obviously, like companies don't want to procure panels or other equipment where individuals are forced into labor. Can you talk more about that whole topic?
Paul Wormser:
Yeah, thank you. This is a really important topic for everybody around the world. Nobody, anywhere, supports the idea of forced labor and the US already has laws in place, and they've been in place for a long time, that say that you cannot bring in products that have been made with forced labor.
With that in mind, there is new legislation that has passed the house. And by the time this broadcast goes out is likely to have been passed by the Senate. [Note: The act has not yet passed the Senate] And once passed by the Senate is almost certain to be signed by the president that is different from the legislation that's already law.
And what's different is the following. There is a province in Western China. The province is Xinjiang, where there are some practices that would generally be considered as forced labor by most labor specialists. The legislation that's in place and coming declares goods made in this province will be assumed to have been made with forced labor. And therefore, if they're going to be brought into the United States, the presumption is guilt until proven innocent, which is a very different standard from the laws that are already in place.
Normally speaking, you wouldn't worry too much about this because modules that we buy in the United States are typically either made in the US or Malaysia, Cambodia, Vietnam, Thailand, but because of tariffs, they're not coming in from China. In this case, the legislation's actually more significant because it includes not just the finished product, but also the materials used to make the finished product.
And it turns out that Xinjiang, China is what you might think of as the epicenter for production of high purity polysilicon. Again, that's the material, that's the basic raw material for making the wafer, which makes the cell, which goes into the module. So if your polysilicon is produced in Xinjiang, it is likely that polysilicon will be assumed to have been made with forced labor, unless you can prove otherwise. And that's a really tough standard to prove.
Module Suppliers Shifting Supply Chains Outside Xinjiang
Paul Wormser:
So what we are seeing is suppliers already shifting their supply chains for any modules that are coming to the United States to make sure that any of the polysilicon that's used is produced outside of Xinjiang. There is sort of a silver lining here in the sense that there is enough polysilicon made in other parts of China to serve the U S market. There is enough polysilicon made, or potentially could be made in the US to serve the US market. So it's not as though the polysilicon is insufficient, but it's a matter of changing where it comes from. And this is something that the importer,s typically the US representatives of the foreign companies will have to deal with. They're going to have to be able to demonstrate that nothing in the module comes from Xinjiang.
Alternatively, they'll have to demonstrate that if there is something in the module from Xinjiang, that there is evidence of zero forced labor. So there's quite a bit of activity I think, happening right now among the suppliers to deal with this. Ultimately, we do believe this is going to become part of the buying specification, where buyers will say, we insist that the product has no forced labor. And it may be that at least for some time, the buyers will say, we insist on proof from you, the supplier, that nothing in the module was ever produced or comes from Xinjiang, China.
So it's a big deal. Alternatively, if products come in and they are suspected of having forced labor, when they get to Customs, Customs has the ability to prevent that product from being released. Customs can issue something called a Withhold Release Order, which means that the product sits there for as much as three months, while the importer can take steps to demonstrate to Customs that everything's fine. If the importer can't do that, then effectively Customs puts the goods back on a ship and sends them back to where they came from. So this could be terribly disruptive to American buyers who are really counting on modules coming through seamlessly.
Benoy Thanjan:
Do you think potentially it could disrupt the supply chain with them getting the raw material from a different province in China.
Paul Wormser:
I think there's enough time before the legislation is passed and goes into law that module manufacturers who are paying attention, we'll get this worked out. It doesn't mean that it's simple. It doesn't mean that it's going to happen in a short period of time, but I think there's enough time for this to get worked out. We shouldn't see supply chain disruptions, at least from the suppliers who are paying attention and taking steps to address this.
Benoy Thanjan:
Yeah. I mean, I knew about the forced labor issue, but I didn't realize about the legislation and that's great that they're doing this and I appreciate you talking about this on the podcast because this is really, important
Paul Wormser:
And I think our industry association also looks at this as very important and they're taking steps to do what they can for their members.
Benoy Thanjan:
That's great to hear, you know, if we don't make a stand and we'll make a stand and that situation, which is pretty a very difficult situation,
Technology Innovations in Solar Modules
Benoy Thanjan:
Um, changing topics as well, like wanted to talk about, you know, technology innovations that you're seeing in solar and solar panels, that would be great to get your perspective with all your experience with working with Clean Energy Associates as well. You have exposure to a lot of information that a lot of companies don't have. So it would be great to get your perspective on it.
Paul Wormser:
Thank you. Being a long-term solar geek, there's nothing more fun than seeing new technologies and new products come to market. And this year has been a whole lot of fun in that sense.
Bifacial Modules Becoming the New Normal
Paul Wormser:
Bifacial modules are not new. They've been around for a very long time, and we've been working with developers around the world for several years to see, and to help facilitate change in what people are buying and deploying. But this year more than ever bifacial has become very, very much the new normal. So that's not a new technology, but it's going into a whole new phase of adoption and acceptability.
Solar Cell and Wafer Size Changes
Paul Wormser:
That's exciting, but the more recent changes that have really come out in 2020 that we're now seeing talked about and starting to see deployed, have to do with, for example, the size of the solar cell. This is all based on the size of the wafer. And for quite a long time, the industry had settled on a wafer size that was fairly common across suppliers. And that wafer size, just to put a number on, it was 158.75 millimeters on a side.
Then the wafer size was increased a little bit into something in the range of 160 to 166 millimeters. And what this meant was not that the efficiency of the module would change, but the size of the cell would change. The power from that larger cell would go up and the module dimensions would go up.
All of these were intended to do two things, get higher power per module and reduce the cost, per watt of making the module. Very successful, but it turned out that going into the 160 range wasn't enough and more recently in the past several months of 2020, we've seen two new wafer size camps come about. One of them in the 180 something size wafer and the other one in the 210 millimeters size wafer. And these are again intended to make a cell more powerful, make the module more powerful, not necessarily more efficient, but more powerful. And these things are good for the most part.
You can imagine that if you're putting modules into a project and you have a choice between a 450 watt module and a 550 watt module, the 550 watt module can bring you some real benefits in terms of your installation costs, your installation hardware, because you'd have to put fewer modules in per megawatt. So these are generally good things.
As the size goes up, there are some downsides, also. The modules physically get heavier. So now you're probably going to find that a crew installs fewer modules per day, although they may install more Watts. The structure may need to get beefed up because of the module as a larger surface area, you can imagine that wind loading is going to be more, and therefore the structure may could be beefed up. But overall, the module manufacturers have pretty much universally started to adopt larger wafers, larger cells, larger modules, all to the benefit of decreasing total cost of ownership for the project. That's exciting.
Benoy Thanjan:
That's really exciting.
New Cell-to-Cell Interconnection Technology
Paul Wormser:
The next area of innovation that has been a lot of fun to see is how cells are connected to each other. And in this case, this does impact efficiency.
What's happening now is that the traditional space that we're all used to seeing as white lines, that separate solar cells, that space as quickly disappearing the space is getting much smaller. And in some cases going away. We started to see this a few years ago with people introducing solar cells that were literally shingled one on top of the other. But in the past year, we've seen a lot of new technologies.
Some of them are called gapless soldering or seamless soldering or paving or tiling. And what this really means is that more of the area under the glass is going to be an active solar cell. And that means more cell area relative to glass area. And that means higher efficiency and higher power for a given size module. So this is a really good advance and we're starting to see basically all module manufacturers come out with their own version of these new cell to cell interconnection technologies.
So with larger wafers, making more power, with new interconnection technologies making more power and more efficiency, with bifacial giving you the backside gain. All of this is really to the good of creating more kilowatt hours per kilowatt and better cost-effective projects around the world.
How Does New Technology Impact Engineering Department
Benoy Thanjan:
You know, the technology has been changing so quickly. When you look at the module, how is your engineering department taking that into account when you develop projects that it takes potentially, you know, a year, year and a half to come online, because there seems to be so much changing within the technology itself.
Paul Wormser:
Yeah. You know, I think we all sort of default to a famous expression by, I believe Wayne Gretzky at some point, or he talked about what made him a great hockey player. And he said, "cause I don't pay attention to where the puck is. I pay attention to where the puck is going to be." And that's a very loose translation, great quote.
We talk to the CTOs and the technology teams and the product teams of the module manufacturers on a regular basis. And we learn from them what their technology roadmaps are, what their product roadmaps are. And based on being able to in essence, know where the puck is going to be or in my language, know what the photovoltaic module is going to be in 2021 or 2022 or 2023, we can use that information, and that estimation tells us really optimize what we're doing in terms of system design and product choices.
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Benoy Thanjan:
And that's helpful. I appreciate you explaining that because I don't think a lot of companies are doing what you're doing, which is looking to where it's going to go to the puck than where it is. So that's really a great way to explain that.
Energy Storage Trends
Benoy Thanjan:
And it would be great to get your perspective too. We talked about trends with solar and with modules, but what about trends with energy storage and energy storage coupled with solar? You know, obviously everyone in the industry is trying to figure out where that's going to be. And, you know, we think there's going to be a lot happening in the near future with that.
Lithium-Ion
Paul Wormser:
So there are so many forms of energy storage that are possible. What matters I think right now is what's practical. And within the realm of practicality today, it's all about chemistry called lithium-ion. And there are a couple of different forms of lithium-ion chemistry, but we can really, in essence, thank electric cars for a lot of the innovation and development and investment that's happening in terms of making better and better batteries, making batteries that are lower and lower costs.
In the world of lithium ion batteries, we're seeing quite a number of suppliers that have traditionally made batteries or things as small as your cell phone, to as large as your car, start to promote battery technologies or energy storage systems. And I would say that in the past 18 months, we have not had a single conversation with a developer that has not included a discussion on energy storage. So it's completely changed. There hasn't been a lot of storage deployed at the moment, but there's a tremendous amount of storage that's going to be deployed that's already contracted. And it's happening more and more every single day.
LFP
Paul Wormser:
Within the broader chemistry of lithium-ion, there are a couple of different derivatives. Some of these derivatives are considered to be less energy dense. In other words, you need a bigger or heavier battery for the same number of megawatt hours of storage, which might not be ideal for some portable applications or some vehicle applications, but it could be great for solar and storage applications together.
And these technologies are often referred to, for example, as LFP. And this is again, a derivative or a variation of lithium-ion is generally regarded to be less use of expensive raw materials and potentially safer. So this is a really good move that's happening in terms of lithium-ion storage, but lithium-ion is not the only thing that we should be paying attention to.
Flow Batteries
Paul Wormser:
So there are batteries that are called flow batteries, for example. It's a very different technology. There is some of this technology already deployed in the US but in very small amounts. There are quite a number of emerging and high growth companies that are focused on this technology. Even some of the really big companies that are looking at energy storage systems are looking at flow battery technology.
And one of the advantages here, is cycle-life. Effectively, a flow battery can cycle many, many times. You can charge it up and discharge it many, many times without shortening the life of the battery. So that's a positive, but it's more of a chemical factory than it is a traditional battery. And the market adoption has been relatively slow so far.
Green Hydrogen
Paul Wormser:
The new kid on the block, the technology that's getting a tremendous amount of discussion today is hydrogen. And I would say, this is something again to me as a solar geek, very exciting, but also maybe a little early. We're not going to see hydrogen deployed for energy storage systems in big numbers for quite some time, but it's starting to happen.
And the excitement about hydrogen is not only can it be something that's produced from water and something that can be produced using electricity generated by solar or by wind. And therefore it can be what we call green hydrogen. It has many opportunities to be transported and to be used. So there's a lot to be done. It's not simple.
And people talked about green hydrogen, not last year, not the year before, but 25 years ago. You know, a wonderful professor at Princeton University made a lot of moves to educate all of us decades ago about the amazing opportunities of hydrogen and it just wasn't happening. And partly because the cost of the electricity to separate the water into hydrogen and oxygen was just not there, but it's there now. And so we're seeing a tremendous amount of interest.
And I'm excited about the possibility there and CEA is right now investigating electrolyzers sourcing from all around the world, including China. And this would help you reduce the cost of hydrogen and therefore make hydrogen more viable as a storage medium, but lots of instruction would be done. Lots of investigation to be done, lots of technology to be developed, but again, another option for storage.
Energy Storage Review
So if we could go back to storage, we've got lithium-ion batteries, we've got flow batteries, we've got hydrogen and there are even other forms. There's kinetic energy storage, a company that basically lifts bricks up into a tower when you have excess energy and as the bricks are taken down and they fall with gravity, they can release energy. And therefore you have storage with no degradation. There's compressed air energy storage, there's geothermal storage. So there's lots happening, but really the King of the Hill, the absolute King of the Hill today is lithium-ion. And it's going to stay that way for a while.
CEA on Electric Vehicles
Benoy Thanjan:
Yeah, that is really interesting, especially to hear about all the different technologies and hydrogen. I've been hearing a lot about that. So it's interesting to hear your perspective and that CEA is looking at it. Have you done any work with electric vehicles or electrification of the car fleet, or has CEA done any work like that?
Paul Wormser:
We look at that from time to time, but the reality is, our basic DNA is solar and storage. And so while there may be a lot of the things that we do when we're looking at a storage system for an energy project that are similar to what you might do, if you're looking at a battery for car, that's not an area that we're active in at this point. We are continuing to look at what's happening in the field to see if there's a business opportunity, but sticking to our knitting is something that's very important to us. We don't want to get too many distractions.
With all of these technologies happening right now. It's so easy and so fun and so exciting to sort of chase everything. What we're doing is we're focusing and we're focusing on solar and energy storage or solar applications.
Benoy Thanjan:
And that makes a lot of sense to be focused. And obviously solar and storage are growing exponentially and will continue to grow exponentially.
Project Insurance and Hail Damage
Benoy Thanjan:
Would be great to get your perspective on project insurance. It's something that you're mentioning of increased importance, especially in a situation that there was a hail storm in Texas. Can you talk more about that? Because I don't think this has been an issue that's been really brought up and talked about.
Paul Wormser:
Sure. Let's go back to some of the basic drivers here. In the past, we've built projects in areas of great sunshine -call that Southern California. Now we're building projects in Texas and West Texas. And if you look at the historical weather data for the United States, there's this fascinating band right through the center of the country that starts in West Texas of where there is severe hail.
Hail that can be not small pebbles like we might be used to seeing, but hail the size of golf balls or hail even up to the size of softballs. And when that kind of hail falls on a project or a roof or a car, there can be some pretty significant damage.
So this happened last year. Last year, there was a project in Texas that was hit hard by large hail and tremendous damage was suffered by the project and the insurer covered the claim, which was very, very high. The result of that is it got everybody's attention. If you're an owner about the risk and if your insurance company about the risk, if you're an investor about the risk.
At the same time as we're building projects in Texas, that we had not historically done much of, we've also gone to bifacial modules that we talked about before and bifacial modules, will typically have glass on the front and potentially have glass on the bottom side. And that means that the glass is thinner. We also have modules that are larger. So between a larger module with thinner glass, you have a higher probability of being damaged from hail than ever before.
So we're building the modules to be less robust, and we're putting them into a location where they need to be more robust. And now the insurance companies all around the world and in the US are concerned about their risks.
How Solar Project Insurance is Changing
Paul Wormser:
So what's happened is premiums have gone up. In addition, coverage has gone down. In addition, where you might be able to go out and buy insurance for your project from one supplier. Now you might have to syndicate suppliers and buy insurance from two, three, four, five, six different providers. So all of this means that when you are buying your project, think about the impact of the weather at that location on your choice of product. And think about the impact of that weather on your insurance premiums before you finalize the site.
To take it one step farther, before you finalize your choice of hardware, do the same thing, think about how that module is going to survive under severe hail if that's something that happens at that location, and think about what is going to cost you for the insurance for the project, and think about what your investors are going to require in terms of covering their risks.
What you want to do as a developer and as a long-term owner is to try to not take that risk all on your own shoulders. So sourcing it from the insurance companies is good risk transference strategy, and putting as much of that risk on the module supplier as possible is good too.
Module Impact Resistance Tests
Paul Wormser:
To take it one step even farther modules are virtually all certified either by the IEC or by UL when they're used in the United States. And to get that certification modules go through some extreme testing, and the testing protocols that are part of these certification processes today include a test of impact resistance.
This test was developed really to see if the glass breaks, and it's been pretty effective at seeing if the glass breaks under fairly easy test conditions. The specifics are that a perfectly round ball of ice is shot by a specialized gun at a module in 11 places. And that ball is about an inch in diameter. And if the glass doesn't break, you pretty much are covered.
But as I said before, hail in some places can be two or three or four or five inches. And therefore this test, underrepresents what you might find. The standards allow you to test more severe conditions, but most module manufacturers have only begun to think about testing more severe conditions. And therefore you can buy a module that's fully certified, but it's been certified based on the minimum test condition for hail, not the maximum.
So the industry is looking at new tests, new requirements, and some of the tests labs that we know and love and work with all the time are developing protocols to more reasonably predict the performance of a module under hail.
Solar Cells Damaged by Hail
Paul Wormser:
And it's not just for broken glass, but we've learned recently in the industry that your glass can come out looking great, but your modules' solar cells are damaged. And we found this in a very recent project up in Calgary, Canada. We went up to take a look at a project and we looked at a hundred modules with EL imaging, which effectively reveals cracks that you can't see with the naked eye. And a hundred modules had glass that was perfect. And a hundred modules had cells that were broken after a hailstorm. So this is a real issue. You don't want broken cells.
Strategic Supply Chain Management
Benoy Thanjan:
That is really interesting. You mentioned obviously the engineering aspect of it and choosing the type of equipment to help what the risks that may occur. Does CEA do that type of work with their engineering group, working with your developers and asset owners to help with making those types of decisions with choosing as part of the selection process of equipment.
Paul Wormser:
We do. Part of our role is in strategic supply chain - helping the buyer. Again, it's a utility company, an IPP, a developer to decide who the right supplier is and what the right product is. When it comes to insurance assessments, when it comes to hail risk, these are pretty much new and emerging areas that absolutely should be brought into the decision process. When it comes to contract language, to contractually put the risk where it belongs, that's something that we've been doing for quite some time. And we've continued to update our recommended contract approaches and language specifically to deal with hail risk and storm risk.
So this is part of our process. It's also part of what the industry is really learning about more and more day by day. And insurers are all trying to do their best to understand how do they model the risk, how do they quantify the risk, and how do they set their premiums?
Benoy Thanjan:
Definitely, that's really helpful to explain. And that's great that you guys are doing that and really bringing up things that are important that everyone I guess, is kind of learning on the fly and then applying that into contract language.
Biden Administrations Impact on Solar and Storage
Benoy Thanjan:
I had a question about how the new administration - Biden administration - how you think that would impact the US solar and storage industry.
Paul Wormser:
Well, overall, I think it's a good thing to be clear. I think the campaign that President-elect Biden ran on and by the time we broadcast is President Biden will have run on, his campaign had a number of basic propositions that I think are favorable to solar or the United States, and certainly his interests in terms of climate change and climate change mitigation is favorable.
His interest in building jobs across the US, especially in light of some kind of a recovery from the whole pandemic is concerned, is favorable to solar. Solar creates jobs. Solar is a great way to reduce the impact of our insatiable quest for electricity in terms of how it impacts the environment and mother earth. So I think this is all favorable.
I believe we're going to see some pretty strong incentives to increase deployment of solar. I think we're going to see some pretty strong incentives to localize as much of the supply chain as possible in the United States. And so I think overall, it's a good thing.
Even with the recent extension of the ITC, which is favorable to solar, we're going to see more things happening that are going to cause companies to build more solar, to make more solar equipment, to do more with solar and more with storage to really help bring more renewable energy to the US landscape.
What Made Paul Passionate About Solar
Benoy Thanjan:
You now have been in the industry for 40 years. What got you passionate about solar and what have you learned through your career that you think would be helpful? Because a lot of the people who listen to this podcast are in the solar industry. It'd be great to get, you know, your insights on that.
Paul Wormser:
It's been a lot of fun, and I have been extraordinarily lucky and privileged to be in this industry for this amount of time. It started when I was literally finishing up my required coursework as a Spanish major in college. And by accident, I picked up an issue of National Geographic that talked about a family in the Azores - the islands - that had no source of energy other than solar, and absolutely a light went off in my head. It was that watershed moment when I said, Oh my God, this is amazing.
So I finished up my semester in Spain, I came back to the U S and my best friend's dad worked at the Department of Energy. This was back in 1976, and I said, I want to do solar. And he said, that's really good. And remember, if you were alive and driving a car at that time, this was right in between the two oil shocks and the long gas lines that we had, in I think 73 and 78. And so it really hit home for me. It also hit home about the number of people around the world that had no source of electricity and what we could do.
So my best friend's dad said, it's a great idea. You have to go to engineering school, and I got scared. I had always been sort of a theater, liberal arts literature, language major, but as a senior, in my language major, I started taking my freshman engineering courses. I graduated and then I went back to school. So I did eight years of full-time undergraduate. Four years for Spanish and four years for engineering, which I wouldn't recommend to other people, but it worked out really well for me.
And I had a chance to study solar under one of the real pioneers who taught at the graduate level at an engineering school in Washington, DC called George Washington. His name was Paul Maycock. And Paul absolutely inspired me to look at what could be done with solar.
At that time grid connected solar didn't happen. This was all about remote electricity and storage. So batteries were a part of the microwave repeaters, cathodic protection, water pumping, things like this, where the applications back at that timeframe, but definitely motivating.
And I was very, very lucky to apply to a solar company as I was finishing up school. That company was Solar Power Corporation, which was owned by Exxon of all things. And Exxon sent their recruiter to campus, who took an interview with me, and the recruiter said, "what do you think about the great oil industry? Wouldn't you like to work in oil?" And I said, well, no, I really want to work in solar. And the recruiter laughed. And I explained to the recruiter, there was this little company in Massachusetts that was part of the Exxon family, and that's where I wanted to work.
So in this great, very, very lucky life that I've had, the recruiter was kind enough to take my application and drop it in the box with hundreds of others in Exxon headquarters in New York. The day before, the solar company went to look for resumes for engineers to join the company. And what they wanted was engineers who had studied solar and spoke more than one language. So now it comes together. I grew up speaking French. I learned Spanish with a degree, I studied solar, I got the job. And, you know, as they say, the rest is history, I've been crazy, crazy lucky.
Conclusion
Benoy Thanjan:
Yeah. That's an amazing story. And it's really been an amazing interview getting your perspective. And I love how you simplify pretty complicated topics. And I mean, you're a true solar Maverick. So I'm excited to have you on the podcast. Our listeners, who we call Mavericks wanted to learn more about your Clean Energy Associates. What's the best way for them to do that?
Paul Wormser:
Well, Benoy, first of all, let me say thank you to you. Thank you for hosting the whole Solar Maverick series and for what you've brought to us as members of the industry and potential members of the industry in terms of what we've all been able to learn from you and from your guests over time. So thank you to you.
In terms of learning about us as you can do with most companies, search for us online. I think you'll find us at cea3.com where you'll get a good overview. You can also contact us either by contacting me directly or contacting our US operation or our China operation. We have quite a number of people in the United States within clean energy. We have a brick and mortar office in Denver. Although most of us work from home, I do in fact, and most of our employees are based all around the world with, I would say the concentration in China, because that's really where most of the factory work is and continues to be.
So from China, most of our engineers will go to factories in China, or we'll have engineers go around the world. And again, we have a pretty large cadre of largely engineering talent in the United States plus sales and marketing of course. Take at cea3.com and look up Clean Energy Associates through any of your favorite search engines, and you'll find us as well.
We're also very present in social media, especially LinkedIn, but also more and more on some of the other social media outlets.
Benoy Thanjan:
We'll have that Paul in the notes as well, so that people could easily find Clean Energy Associates like information. And I appreciate again, Paul, you being on the podcast, thank you for making the time today.
Paul Wormser:
A real pleasure Benoy again, thank you for what you do. We're lucky to be in this industry. We are doing a lot of good for a lot of people all over the world. And I think that helps us both wake up every day, looking forward to the day and thinking about what we get to do.
Benoy Thanjan:
It definitely does. And this podcast really got me excited and motivated more after speaking with you. So thanks again.
Paul Wormser:
Good deal. Thank you so much.
Benoy Thanjan:
Thanks for listening to the Solar Maverick Podcast. The Solar Maverick Podcast is brought to you by Renew Energy. We're a solar development and consulting firm. If you believe that this podcast is adding value to you, please give us a five star review and share with those that you think could benefit from this information. Please email all questions, suggestions, and feedback to info@reneuenergy.com. That's info@reneuenergy.com. The Solar Maverick Podcast is produced by Podcast Laundry and executive produced by Benoy Thanjan and Kevin Y. Brown.
