The Holistic Approach to Procuring Quality PV Modules: Contract Diligently, Test Thoroughly, Inspect Carefully

What Can PV Module Buyers Be Doing to Mitigate Procurement Quality Risk?

The solar industry is simultaneously experiencing the highest demand, fastest technological innovation, and greatest uncertainty in its history. These facets have all contributed to a rapidly changing environment where technologies, factories, workshops, and workers are updated, replaced, and brought online at an unprecedented pace - leading to greater risk in module quality.

Furthermore, in the wake of the recent AD/CVD investigation announcement in the U.S., many PV buyers may turn to suppliers they have not purchased from before. What can PV module buyers be doing to mitigate module procurement risk and protect their investments?

In this joint webinar, experts from Clean Energy Associates (CEA), PVEL, and Strata Clean Energy discuss best practices to help ensure developers are procuring quality PV modules.

George Touloupas, Senior Director of Technology & Quality at CEA, shares insights from the company’s Golden Standard which standardizes the contracting process for all the critical requirements, from product testing specs to quality inspection details. Approaching contracting with a detailed standard set of requirements and technical exhibits can help greatly, especially if done early to avoid difficult last-minute negotiations.

Tristan Erion-Lorico, PVEL's Head of PV Module Business, discusses recent test results and their bill of materials (BOM) dependence, leveraging over ten years of accumulated lab and field data. PVEL also demonstrates how the Product Qualification Program (PQP) fills the gap between product certification and downstream buyers' necessary due diligence.

Finally, vertically integrated clean technology company Strata Clean Energy's Leni John and William Johnson highlight their focus on quality, reliability, and long-term value by sharing real-world examples of the module quality assurance challenges they have faced and describing the solutions their QA partners have provided.

Webinar Transcript

SunCast introduction

Nico Johnson

(00:00)
Welcome to today's webinar. Thank you for joining us on behalf of CEA and our esteemed panellists. My name is Nico Johnson, founder and host of Suncast Media and the Suncast Podcast. And I hope that you have joined because today you are interested in fact in developing a holistic approach to procuring quality PV modules. My sense is that more than a few of you have joined because you, like 78% of the industry, are experiencing delays or outright cancellations of your PV modules. And you're asking the question: what the heck am I gonna do right now? Well, I want you to rest easy knowing that we don't have the answers either, but we do have some answers on how you can assure your risk mitigation strategy is tight as we weather these turbulent times. I wanna kick things off with a quick poll and, as I do, I want to thank everyone who showed up on time.

(00:50)
Love those that do show up on time. The early bird gets the worm, as they say. And right now, you gotta be early to get any sense of module procurement right now in the industry. So, following the AD/CVD decision, are you considering buying solar panels from suppliers that maybe you haven't used in the past? Yes or no? You see, in the wake of the recent AD/CVD decision, many solar buyers are turning to suppliers that they haven't purchased from before. Today's discussion, we're gonna feature experts from CEA, PVEL and Strata who will discuss strategies to minimize quality risks, especially when you're buying from new or perhaps unapproved as yet, vendors and suppliers. Maybe they're not on your AVL, maybe they're completely, altogether, new to you and your team, but not to the industry as a whole.

(01:37)
So we're gonna take a look at that poll. I'd like to remind you to drop your questions throughout. So I'd like to remind you to drop your questions in the questions box here. That will filter them up for us as organizers and we'll curate them. We're gonna take a few questions throughout but at the end, there will be a segment that I'll moderate for question and answer. The format of today's conversation is really straightforward. We are going to have presentations, brief presentations, of eight minutes or less from Leni John, chief Procurement Officer of Strata and his compatriot William Johnson, Sourcing and Supplying Quality Manager at Strata. They'll talk about specific case studies where they've had to address the issues that you all are facing in your business. We have George Touloupas from CEA (Clean Energy Associates), senior Director of Technology and Quality. And we also have Tristan Arion-Lorico, head of the PV Module Business Unit for PVEL. Before we get into the presentations, I'd like to invite Leni John to the stage to give a little bit of perspective on the problem that we're all addressing today.

Strata Clean Energy introduction

Leni John

(02:54)
Thank you, Nico. And thank you all for joining. For those who aren't familiar with Strata Clean Energy; we are a North Carolina-based, integrated clean energy company, and we've been installing solar projects since 2008, and our focus has primarily been on utility-scale projects. And we've also become one of the largest battery storage developers with a huge pipeline. And Strata's unique vertical integration gives us the perspective of a developer, an EPC contractor, an O&M (Operations and maintenance) provider, and an independent power producer. This per perspective gives us an appreciation of the importance of quality assurance. And during our 14 years of experience procuring solar modules, we have learned a few key lessons that we are going to share with you today. The main lesson we have learned is that proper quality assurance procedures need to be implemented in every order because even trusted suppliers can pose quality risks.

(03:57)
This is especially true in the current challenging supplier environment. Suppliers have incentives to control costs by compromising on quality or resisting quality assurance requirements from customers. So if you're looking into procuring modules from a new supplier, as Nico mentioned, due to this AD/CVD investigation or other market volatility, a good QA program can help de-risk procurement of modules from an unfamiliar supplier. To ensure we are procuring only the best quality modules, we rely heavily on quality assurance partners, such as CEA and PVEL, and we thank them for including us and today's webinar.

Nico Johnson

(04:38)
Thanks, Leni, appreciate that. So now without further ado, I want to bring up CEA's own George Touloupas, Senior Director of Technology and Quality, to help us understand the benefits of taking a standardized and detailed approach to contracting. George, I hope I haven't butchered your last name.

CEA’s Golden Standard

George Touloupas

(05:02)
Yeah, it's close. Thank you. So I'm gonna talk about CEA's Golden Standard for PV module procurement. So in the last 10 to 15 years solar plowed through waves of supply chain turmoil, regulatory headwinds, and trade wars like today. And despite all this, we've managed to globally have installed just recently one terabyte, which is the cost of celebrations and parties. And I know there have been some parties in March. However, we have a new type of challenge emerging as solar grows. And this has to do with the pace and scale of changes in the PV sector in the last four to five years, which is unprecedented Of the products that the buyers were getting just five years ago were very different from what is offered today. In 2017, the most common utility scale product was a 72 full-cell multi-cell technology glass back sheet module using a six-inch wafer. And that was really first launched, I believe, by Santec back in 2008. So remarkable stability. However, in the last five years, we have witnessed the massive shift from multi-crystalline aluminum box surface fill cell technology to mono Perc, the wide adoption of half-cut cells, the dominance of bi-facial glass products, the introduction of multiple busbars, wires, the shift towards very large formal wafers and modules, 182 and 210, and now the rise of n-type cell technologies and predominantly n Topcon. So this is a challenging landscape.

(06:57)
CEA's quality assurance teams collect lots of data continuously during our inspections in the factories. So we mark findings and defects of various variants and frequencies. Our supplier benchmarking program platform processes this data and outputs quality risk courses and grades that help us benchmark the quality of projects and suppliers. Now, the high bars mean that there is a high risk in this chart. This is a chart of pre-shipment and inspection data. It is focusing on just five major P module suppliers from 2018 to 2022. Now, looking at this, it's obvious that there are ups and downs, but overall, the risk score goes up. It has gone up, it's quite obvious. And our detailed data show that cracks weak soldering, and misalignment of reborn are the main factors that may cause spikes in risk scores for some projects. So, spikes of high-risk resulting in increased batch rejections and annual work. And we believe that suppliers have a hard time optimizing and troubleshooting their new or upgraded lines while adapting to these new technologies. Now, hands-on quality assurance was always a must in procuring modules, but the need to do this now is even more pressing.

(08:30)
CEA's Golden Standard was developed back in 2016 and has since grown in depth sophistication covering new technology and risks, with the bill of material review service standardized and added about three years ago. Now, the Golden standard defines the product, production, and quality assurance requirements. After all, these are set, the buyers appointed third-party auditors can go into the factories and perform audits, monitoring inspections and testing with the assurance that all the rules have been defined and agreed beforehand between the buyer, supplier, and auditor, plus minimizing conflict and ambiguity during production. So you can see here how the golden standard is connected to the subsequent QA steps by seeing the arrows. So if you can forward to the next slide, we'll see the arrows as well.

(09:57)
Now the golden standard is a full-service package that is split in parts, and this is done for flexibility and ease of execution. Product requirements include the bill of material, certification, external reliability testing performance such as PVEL's PQP that Tristan will present later on and characterization testing upon files, IAM and the like. Production requirements set production standards from warehouses to packaging of a finished project for product and quality assurance requirements take care of the in-production monitoring conditions, pre-shipment product sampling inspection, batch testing, inspection criteria, sampling rates, acceptable number of defects and defined buyer bias rights is very important to inspect, accept, and inject product. In parallel, the BOM review checks that the product requirements are followed, and we'll see that a bit in more detail later.

(11:07)
The exhibits are the final output of this process and can be incorporated directly into the buyer contracts with suppliers. The structuring of the golden standard into exhibits gives flexibility to negotiate each one separately, and in parallel the method of negotiations is flexible. Buyers can choose to lead the negotiations or can have CEA do this, but in all cases, it's a fully transparent and agile process. Now, CEA's experience with hundreds of such negotiations in the past few years with many main suppliers, and the biggest ones of course, ensures that a buyer can get the best deal possible for a certain supplier for a specific timeline and for a specific product class.

(11:54)
And let's go see some more examples of how this is done. Looking at the bottom right-hand corner, this is what a demanding buyer will do with strict requirements. They will choose the full package and execute the whole exhibit set for product production and quality assurance requirements. However, we might sometimes have a buyer who will want to control the QA aspect. So moving up in the right-hand upper corner, we can see that this buyer will have us negotiate the product definition and the buyer QA with the rights and criteria as well, which are very important. Also, batch testing. So there are several combinations that can be executed that highlight the flexibility of the service, which is modular and can be quickly adapted to the client's needs and requirements.

Bill of Material review

(13:12)
Now, a few words about the BOM (Bill of material) review. The BOM review screens risky BOM combinations. These might be either unsuitable for the project conditions. For example, if there is a severe hail, then maybe the glass can't take it or the module construction cannot take it. Or if there is severe snow load. They might not perform well for example, in extended reliability testing, PQP testing. Sothis can be found out reviewing the test reports or sometimes the materials don't have enough track record. They're fairly new or not so well known. So there's inherently a risk aversion in this cases. At any rate, IE's and TA's technical advisors, independent engineers can get very helpful insights by reading these reports, really inside knowledge and deep analysis. And we can do this at five different levels, depending on timeline and client needs from very basic, like we can get a bill of material list and quickly check the material, the suppliers, and we have some confidence by having seen a large number of test reports. We have a pretty good idea of the quality of the material suppliers. But of course, you know, the most comprehensive standard plus where one has to do a full review of reliability, external reliability testing report, and for very special project conditions or if the performance characterization files need to be reviewed, we do the comprehensive service.

(14:57)
So moving on to the conclusions.

Conclusions

(15:07)
Quality assurance is a very holistic process, and it has to be done early. And it's very important that as a corporation, these quality exhibits that touch on quality and technology as well, as technical and quality exhibits expertly reviewed in their contracts. If you wanna do that later on, it's gonna be very hard, especially when it's a seller's market like it is now. So it's better to do everything in place at the very beginning, but also speed and flexibility are very important. And that's why this structuring of moderate exhibits allows for very efficient handling like power negotiation, customization and faster negotiation with suppliers, which is always a great advantage when things can't take time. It has to happen tomorrow. And in general, there are always benefits to adopting a risk-controlled attitude. So markets might become so difficult like they are now, but achieving all the goals in negotiation is virtually impossible. However, we can always control risk and prioritize objectives, and this can be done by expert guidance based on our prior knowledge and what is happening in the market, what has happened in the past, and what each supplier is willing to give and concede. There's always a course of action no matter how difficult the circumstances are. Thank you very much.

Nico Johnson

(16:46)
George, thank you. That was very informative and I would say very helpful for those who are, no doubt, trying to estimate what quality assurance should look like for the company, I would wager that many have not gone into a deep level of quality assurance that the likes of your customers have done. I have a question from the audience that I know is on the mind of at least one person, so we'll bring it up for you now. And for those who didn't see my message, we will do a round of, we'll do one question from the Q&A pool that I encourage you to drop into the questions. Thank you to those who've done it. And then at the end, we'll have a section for the remaining queue of questions for today's panellists. So, George given that we are facing an acute shortage of supply options, especially for the US market, which would consider being the absolutely essential, quality assurance activities that a buyer just absolutely can't dispense with?

George Touloupas

(17:41)
Yeah, that's a tough question. It's like doing trials, right? It's always difficult to decide, but definitely in the factory. So have people in the factory really make sure that you are there on daily basis, not doing the weekly or bi-weekly inspection. This is very important. And also, you know, really insist on the bill of materials that it has passed several key milestone testing. It's very important. We know that certification testing is not really enough. So even if it's not available now, it's gonna be available in 3, 4, 5, or six months. It has to be in the contracts. This is fundamental.

Nico Johnson

(18:24)
Very well; be in the factory. Well, it's often very difficult to wrap folks’ heads around being in the factory. So I'm sure somebody's gonna reach out to you, George, to figure out how they can have an extension of their team in the factory. And that's something that CEA spends a lot of time helping customers with. Well, George, thanks for your presentation. We're gonna go now to the head of PV bot module business Tristan Tristan Arion-Lorico for PVEL. Tristan's gonna help us understand how testing fits in and fills the gap between product certification and buyers’ due diligence. Hey, Tristan, good to see you.

PVEL

Tristan Erion-Lorico

(18:55)
Hey, thanks for having me. And great segway from what George just said about knowing that certification testing is not sufficient to protect investments, that's what I will be focusing this presentation on. So, first, a quick introduction for those of you who don't know us, PV Evolution Labs or PVEL as we're known in the industry, is the independent lab of the downstream solar and storage market. And we're based in California, USA. You may have heard of us from our rather popular annual PV module reliability scorecard. The 2021 edition has been accessed over 20,000 times since we released it last May, and we're just finishing up the next edition, which will be released next month. So, as it says here, our mission since our founding over 10 years ago, is to create data that matters for the solar and storage industry adoption. As you can see on the screen, we provide a wide range of services to the industry, which is all focused on that mission.

(19:58)
And we work with companies all over the world including banks, developers, asset owners, insurers, et cetera. We have over 400 downstream partners in the PV and storage stakeholder community, and we support them with data to de-risk their procurements and projects. So just quickly an agenda slide here. First, I'll give a brief refresher on PVEL'S product qualification program or PQP. Then we'll look at four recent PQP test results that demonstrate how our testing provides value over just relying on certification, as well as showing how changing the bill of materials can impact module reliability.

PVEL's product qualification program or PQP

So for that refresher on the PQP, for those familiar with it, or an introduction, for those of you who aren't PVEL launched the module PQP in 2012 with two goals. So one, is to provide the necessary due diligence to the downstream, giving that valuable data to them.

(21:03)
And two, to provide third-party recognition to module manufacturers who are producing reliable products. So one key aspect to the PQP as you can see there, is that sample modules that get shipped to PVEL are factory witnessed during production. This is a gating step for every PQP that we test. Our In factory auditors from CEA or other service providers follow a multi-step approach to ensure that the bill of materials being used in the modules we receive has been verified and recorded in detail. And this is included in our PQP factory witness reports. So from there, it can be extracted into BOM exhibits, as George discussed earlier. And if you get those BOM exhibits from PVEL, they are free of charge for use in your procurement contracts and specifying the exact BOM or BOMS that did well in PVEL's PQP testing is one of our key recommended procurement best practices.

(22:03)
So another key principle of the PQP is that it's regularly updated to provide module buyers with consistently relevant data as new technologies and manufacturing techniques are introduced. The current test plan for the PQP is shown on the screen there, and we released that version last October. The updates we make to it are in response to feedback from the market, including downstream buyers, asset owners, financiers, independent engineers, also from module manufacturers and independent research institutions. As you can see, the PQP includes a number of tests designed to address a range of known PV module failure modes, as well as in-depth module characterizations at different radiances and temperatures and different light angles. That's part of the PAN and IAM testing. So PQP participants submit their factory witness samples for all of these tests, and the reports are released throughout the project's duration.

(23:03)
These reports, again, are available for free to PVEL's downstream partners. So if you'd like to sign up as a downstream partner, please contact us via our website, pvel.com. And you can breeze over that, that's just an introduction to these fascinating results coming up.

PQP test results

So this first example is from our thermal cycling test, where modules are chilled to minus 40 degrees, then heated up to plus 85, then cooled down again to minus 40, and while the temperatures increase, the modules are subjected to maximum power current that stresses the module's bypass diodes and soldering. So in this case, we have a module that did really well following 200 of those thermal cycles, and that's the IEC 61215 test duration. But on the second round of 200 cycles, the module suffered a catastrophic failure due to a short-circuited bypass diode or an internal open circuit in the module, and that reduced the module power output by a third.

(24:09)
This is sometimes referred to as a sub-module failure. And we have field data that shows that these types of defects can be quite prevalent in batches of modules. And it's something that certification testing rarely detects, but our thermal cycling to 600 cycles can weed out those types of modules and those designs. So we have a similar example here, but from our damp heat test, which subjects the module to 2000 hours at high temperature and high humidity, this instigates corrosion and or delamination in susceptible modules. So note again here, the IEC certification requirement is a thousand hours, but for the PQP we double that to 2000 hours. Again, here we see on the left side of the screen that the module did quite well following a thousand hours of damp heat, and it easily passed the IEC acceptance criteria of less than 5% power loss.

(25:12)
But after putting the module back into the climate chamber for another thousand hours, we can see that a corrosion issue is revealed around the cell's perimeter. This has led to power loss that is higher than 95% of the modules that are subjected to this test. So definitely an outlier here and one that you probably don't want on your projects. So this next example is from our mechanical stress sequence, which combines static mechanical load, dynamic mechanical load, thermal cycling, and humidity freeze. So four different tests and that combination articulates and propagate cell cracks in susceptible modules as would occur in field conditions. Here we have two very similar bills of material produced by the same module manufacturer, and these have the same nameplate on the back. They're the same module with the same datasheet, but using two different bills of material.

(26:10)
And really the only difference between those bills of material are the glass and encapsulant suppliers that were used. Everything else is the same, the same frame, the same cells. Everything else is the same. Other than those two raw material suppliers. On the left, the module did quite well. It would be considered a top performer in our scorecard. On the right, the module passed the IEC Static Mechanical Load Test which doesn't require any subsequent stress testing, but when that module is put through the full test sequence at PVEL, it had greater than 5% power loss. And if you look at that EL image there, it looks more like modern art than a functioning PV module. So not very good. You probably want BOM one on your project and not BOM two. And for this last example let's look at potential induced degradation.

(27:05)
This test uses high temperature and high humidity as well as high voltage to instigate PID and susceptible modules. Again, here we have two BOMs from the same manufacturer, the same part number, same everything identical cells, and the materials are also the same, but there are some differences in the materials as listed on the screen. Those are clearly impacting performance. Again, the BOM on the left is a top performer, and the BOM on the right just passed the IECPID requirement. That PID test was just added to 61215 last year. It's for 96 hours and 5% power loss is the maximum allowed. So you can see it was at 4.8% power loss. It passes certification, it could become certified and end up in your project. But what would you rather invest in: BOM 1 or BOM 2? So that's pretty much it from me for now. Hopefully, you've seen that certification testing does not fully determine if specific bills of material are worth investing in. And you can see the clear value that PVEL's PQP brings to the industry. We'll be going further into these topics in our upcoming PV module Reliability Scorecard, which is shaping up to be the best one yet. And so please watch out for that being released next month.

Nico Johnson

(28:37)
Nice plug there at the end, Tristan, and your scorecard has been your calling card. It's definitely one of the ways that you and I met and something that folks become acquainted with PVEL for. And the quality that you guys offer in the industry is really par excellence. So I have a question from the audience specific to PQP around this current seller's market. It's effectively turning down orders in the market rather than taking orders. So what happens when a manufacturer is just reluctant to complete PQP testing? What should I do as an installer if the manufacturers won't agree to sign up for this level of testing?

Tristan Erion-Lorico

(29:19)
So very timely question. I've been talking to an up-and-coming manufacturer recently, and they've been really dragging their heels about PQP. They don't know if they wanna do it or not. And one of their purchasers who's signing up to buy a few hundred megawatts came to us and said: we need a quote for PQP testing. We're gonna pay for this ourselves. You know, it's, it's not gonna be eligible for the scorecard now because it's a now a downstream project. So that developer isn't gonna share the reports with anybody. They're paying for it, and they own that data, but they see enough value in the data that they're going to sponsor that project. They're going to arrange for the factory witness and get us samples and do that themselves rather than, you know, let the manufacturer drag out these negotiations or, or refuse to do the testing. And, you know, it's, it's results like what we've shown in the past scorecards and what we just showed on the screen there that has convinced them that this is important data. We need to do this for ourselves. Yeah, hopefully, manufacturers sign up and we share the data with the downstream for free. But if they're not going to do that, it's definitely still a worthwhile investment. And this is very important data to help determine which BOMs to purchase.

Nico Johnson

(30:48)
It sounds like what you're saying is it's a point of leverage even in the contracting period, that eventually module manufacturers are gonna want to have this as one of the boxes that are checked, just like getting other types of certifications. And that the example you gave is an IPP and an asset owner themselves saying, we want this kind of qualification in order to know that, that the asset is secure and that we can stand behind. Is that right?

Tristan Erion-Lorico

(31:12)
Yeah, and for that, IPP can go to their investors and say: we check the box ourselves. Here's the PQP data, you know, we have this, and it's going to make their conversations with their investors much easier than saying, well, the manufacturer didn't want to do it, so we didn't bother. And, and now investors might walk away from those projects.

Nico Johnson

(31:34)
Makes sense. We'll have more questions for you. Many of questions were coming in for you as you were doing that presentation. Thank you for that. Finally, we are going to have the customer's perspective once again from Leni John and William Johnson. Leni, as I mentioned earlier, is the chief procurement officer at Strata. And Will is his right-hand, sourcing and supplier quality manager at Strata. They're gonna share real-world examples of module quality challenges and how they overcame them.

CASE STUDY 1: Contract

William Johnson

(32:02)
Hi. Good morning, good afternoon, or good evening, depending on where you are. Thanks, Nico. And as Nico mentioned, yes, we're gonna share some real-world experiences that we've had procuring modules and we're gonna start our first case study at the very beginning of the module procurement process with the contract. Because as George mentioned, that's exactly where a good quality program begins, at the very beginning of the process with the contract. So at a very basic level, you need contractual assurance from your supplier that they will allow access to the facility for in-factory inspection, or that they'll comply with other requirements you might have, such as using a bill of materials that performed well under PVEL's testing. But those are really the basics. Ideally, your supply contract with the module supplier should have a lot more detail than that.

(32:50)
And so George touched on some of this, but our typical process is to work with our quality consultant alongside the module supplier in order to develop a contract exhibit to put into the module supply contract that specifies in great detail what exactly constitutes a defect that, we as the buyer, are able to reject the module or batch of modules for during production. And so this exhibit has a lot of details on each possible defect. It has images like the one that you see on your screen, pointing out what the defect looks like, measurements and other technical data to make it really clear what constitutes a defect during production.

(33:32)
For one project, unfortunately, we had a very tight timeline for contracting the module supply with the module supplier. And we were unable to get a contract exhibit like this developed and into our contract. We had to, in fact, defer to the module supplier's internal QA criteria. And so when CEA inspected the modules, they found that there was a very significant portion of the modules that had a cold soldering defect, which is the one you see pictured on the slide. And this defect does have some pretty serious implications for the long-term reliability and performance of the module. But unfortunately for us, since we were using the supplier's internal criteria, the supplier did not actually even consider cold soldering to be a defect. And because we were using the supplier's criteria, strata had no contractual basis for rejecting these modules. We did end up having to take delivery of them, and we did end up having to install them on our project. Now, this case study could have had a little bit more of a negative ending than it did. We were able to get to a commercial resolution with the supplier. And so the supplier did grant us an enhanced warranty remedy in the effect that the cold soldered modules start to fail over time. And we are still monitoring these modules to see what impact they'll have on our plant. But this is the kind of issue you can completely avoid fairly easily if you do develop a very detailed contract exhibit.

(35:02)
I'm gonna hand our second case study over to Leni.

CASE STUDY 2: Test

Leni John

(35:07)
Thanks, Will. And so one possible approach is inspecting and, and doing module inspection with new suppliers as some of you are considering right now. And, and part of their qualification would be to pass the inspections or pre-production audit. But we work with our third-party QA consultants like CEA on all our projects, whether we've worked with the supplier for years or if they're a new supplier. And the reason is that even those that are highly reputable suppliers have challenges that come up. And this one particular case study talks about testing thoroughly, and that's one thing that sets Strata apart from many others buyers: CEA can attest to this and others have as well. Strata inspect every single module that we buy and take on a project site because of how important it is to ensure the performance and the long-term performance of our power plants.

(36:15)
And with this particular case, the supplier was highly qualified in their factory, their original factory where they produced modules, but they had opened up a new factory and we were doing the hundred percent EL image inspections. And as you can see early on, there was quite a high rate of defects and primarily related to the cold soldering defects as Will had mentioned. And in this case, you know, there was a lot of pushback on whether or not these modules really were defective and whether or not they will have performance issues. The way we actually resolved that is we ended up reaching out to PVEL and PVEL happened to have been doing some inspections for another customer that was having their power plants underperforming. And one of the module manufacturers was this specific one.

(37:15)
Three years after the modules were installed, there were underperforming modules on the site due to cold soldering defects. And as a result of their support, their data as well as CEA's, we worked very closely with the manufacturer to accept these as defective modules. We rejected them and were able to produce new modules while working with the factory to improve the rejection rate. So this is an example where, you know, working with a new with an existing supplier, if they're using a new OEM, which you'll actually hear on the next case study, it can have an impact regardless of how highly regarded the manufacturer is. And one thing we did after this case, or after this situation had been resolved, CEA did an evaluation of what the potential impact would've been to that to that project had we not rejected those modules. Turns out it was somewhere around 4% could have been impacted to the overall production long-term production of that power plant. So this is why it's very important to test thoroughly. And it is an important case study that really was telling that our thoroughness in testing is very vital to the long-term performance of our projects.

CASE STUDY 3: Inspect

William Johnson

(38:54)
Okay, so our third case study is called ‘Inspect carefully’. And this case study comes from a project where the module supplier had elected to subcontract the module assembly out to a third-party OEM factory. Strata have worked with a variety of suppliers in the past that have used a variety of different OEM factories, and many of these facilities produced some of the best quality modules on the market. However, in this case, neither Strata nor the module supplier had worked with this particular OEM in the past. And so neither of us really knew what to expect going in. So when CEA arrived at the OEM factory for the factory audit a few weeks prior to production, they found, among other issues, that the workshop that was supposed to be used in just a few weeks to start the production was not actually included in the supplier's UL certification, meaning that they wouldn't be able to put UL labels on any of our products, which would've been a really big problem for our project.

(39:51)
Fortunately, since we did have the factory audit scheduled a couple of weeks before the production, there was enough time for the supplier to fix this, as well as address all the other quality issues that CEA found during the factory audit. Unfortunately, we weren't out of the woods yet once that was complete. When CEA got to the factory again for the first day of production, they did identify quite a few new quality issues during the first couple of batches that were produced. You can see a few of them are listed here on the slide. And one that I want to draw special attention to is the fact that this factory was actually for certain modules rounding up the power output measurements on the modules and sorting them into BIN classes that were higher than what they really should have been sorted into in order to meet the BIN classes that we had ordered for the project.

(40:42)
So, had we not been able to have inspectors on the ground catching issues like that, not only would we have paid for power output that we didn't actually receive, we probably would've had some issues with underperformance on this particular project. In addition to that, as I mentioned, there were several other quality issues, and this led to us rejecting four out of the first six batches that came off the production line. In a lot of cases when this happens, suppliers might choose to continue the production and continue to let batches get rejected until enough batches meet the minimum quality standards to fulfill the order quantity. In this case, though, due to the severity of the defects, we were able to reach an agreement with the supplier to actually cancel the current production run and postpone the production to a later date at the supplier's own factory, which we knew to have better quality control than the OEM factory.

CASE STUDY 4: Verify

Leni John

(41:43)
Okay. And now, this last case study, I mean, you do everything with the inspection, the pre-production audits and the pre-shipment inspections, you would expect all your modules have been qualified and validated in terms of their quality. Well, that doesn't mean you're necessarily going to get the modules that you inspected. Here's a case where that happened to us. So the production of the modules were completed and the supplier shipped the products and provided all the flash test data with the serial numbers. So our team does some validation just to make sure that everything that CEA inspected for us is what is shipped out of the factory. Come to find out a portion of the modules that were inspected didn't make the shipments, and we received other modules that were not inspected.

(42:44)
And so we had to work with the supplier and CEA to get access to the EL images for those modules that were not inspected. And they identified defects on 852 modules that would've been rejected at the factory. And as a result, the supplier had to replace those modules before we had to replace them out of the shipments that were received. And we got new modules that were inspected and passed the QA/QC. So that just shows that you can trust but also have to verify your supplier's accuracy. It's very important to ensure that if you're spending all this money and effort and resources to ensure you are inspecting these modules. Make sure you're getting the modules that you inspected.

Nico Johnson

(43:51)
Fascinating. Thank you, Leni and Will. These are excellent examples from the real world. One of the leading EPCs in America, explaining how not only they have dealt with issues in the field, but as I say, success leaves clues. So now in this webinar, you all get a chance to avoid some of the challenges these folks have successfully navigated. As we transition into the Q&A session. I'd like to take a moment just to invite you all to keep up to date on the topics we're discussing here by following today's presenters and the companies they represent. We've got them presented here on the screen, and we'll drop them into both emails as well as the chat with clickable link so that you can follow along. Please do so. Again, as I didn't introduce myself, perhaps in the beginning, please as well, look for me. My name is Nico Johnson. I am the host of a popular podcast called SunCast, and my company is Suncast Media. For the last 15-plus years I've been in the solar industry helping folks navigate this sector and make informed confident decisions. Next, we're gonna go into the Q&A session. I'd like to invite all of the panellists back onto the stage if you will.

(45:10)
Thank you to those of you who have submitted questions. We are filtering through them. We may not have time to get through all of them here but we're thankful for those of you who did submit questions. If you have one still that you'd like to present to the panellists, please drop it into the questions function of the control panel. All right, folks, so I appreciate the wealth of information that was served to the audience today. I'm certain that folks are grateful as well. We're gonna jump into some questions that were raised. And I'll start with one for you all at Strata. How can I get suppliers to accept quality audit requirements when the supply is so limited due to AD/CVD shipping disruptions, et cetera?

William Johnson

(45:57)
I'll take this one. That's a difficult position to be in, certainly. As you can see, and as we've discussed a few times, a lot of our most critical quality issues that we've encountered have been with new suppliers, new factories, and things like that. So, on the one hand, it's, definitely more critical than ever if you are considering a new supplier to have some kind of quality assurance as part of your supply contract. I would think that on the other hand, unfortunately, it is a little bit difficult at this point in time in a lot of markets with constraints. Suppliers do have a lot of leverage to push back on these QA requirements. But I would think that at the very least, you as, as George mentioned, would want to have somebody in the factory to catch issues like many of the ones we discussed today. And you could maybe compromise or you may be forced to compromise on some of the specific criteria. Maybe you can't use CEA's Golden Standard. Maybe you have to use some portion of the suppliers’ criteria. But at the very least, I would think that a reputable supplier would allow for in-factory inspection just to verify that that factory is using the supplier's own quality processes.

Nico Johnson

(47:13)
Fantastic Will. I'm going to combine a couple of questions here. We have two that are similar, so I'll ask them in a similar fashion, and this is to you George and CEA and it's around the BOM and third-party testing of the BOM. So what should a buyer do if the production BOM is found to be different from the agreed BOM? And the similar tangential question was, how important is it to carry out third-party testing of the BOM used in the module?

George Touloupas

(47:46)
Yeah, so these are a bit different actually. Because by third-party testing I understand that the person was, the question means external reliability testing like PQP testing. Now, BOM is different. This might have an immediate impact like it's not certified. So this is like the worst impact. Or it could be certified, but not agreed upon. So maybe, perhaps because some of the materials were not considered the best in class, like, based on what Tristan showed us before. So it depends actually. So worst case, it's not certified. That's really bad news. We do have cases like that happening from time to time, and I predict that given the situation in the US, specifically for the US, we're going to see a lot more than that.

(48:42)
Changes in cell supply because cells are not available. This is classic. Now, it has to be tested, otherwise, it's illegal basically to be labelled and then shipped. So that takes three months. So project delays, it has to be extended and tested as well. That will take some time. It has to be done. So these are very important milestones. Otherwise, you take too much risk.

Nico Johnson

(49:12)
Very interesting. Thank you, George. And of course, at any point, if anyone else on the panel wants to tag on, feel free to just raise your hand or just jump right in as well. There's an interesting question here that I think probably is appropriate for both PVEL and CEA and it goes: I have been forced to finalize my module order while the PQP results are still pending. How do I handle this? Tristan, you wanna go first?

Tristan Erion-Lorico

(49:38)
Yeah, sure. The PQP for the main reliability test takes about six months. And this is a fast-changing market and you're forced to make decisions. So, you're not alone. Whoever asked this question. I think it's quite common to accept the bill of materials based on the initial reports that, that we produce, that you don't have to wait the full six months. We're, we're releasing reports almost on a monthly basis. So based on those reports, if things look good, you can accept that BOM. I also think that obviously having the final reports is important, but for manufacturers, you know, submitting to PQP testing, that shows a certain amount of confidence in their materials. And, you know, just seeing that they've signed up and they're going ahead with it should give you more confidence than a manufacturer that downright refuses to.

(50:39)
So I, I think if, if the PQP is being initiated, that is some good news versus them refusing to do that, refusing to do, it's certainly a red flag. So you know, you might have to not be able to wait the whole time, but I think you should be reassured that at least the modules are in the chamber in the lab, and you will be getting that data. And I'll pass it over to George who, I assume, we'll talk about what you can put in the agreement should our testing uncover some issues.

George Touloupas

(51:17)
Yes. This is extremely common, as you say right now, and especially in the last few years with all these changes a manufacturer didn't really have time or the budget to do all the testing that was required. It's also very important I mean, PQP is really, let's say, a very important flavour of the reliability testing and which is done, whereas a framework, IC framework, a lot of entities do it, but it's very important to do it properly. So making sure that the samples represent the area population. So witnessing the production, these are very important details. And actually, when we don't see witnessing, we flag it in our review. So when it's not there, it has to be agreed upon. Okay. And we have some certain limits in our common standard, so not more than 5%. I know it sounds a lot but there is a stop cap. If, if it fails, there should be liquidated damages, even if it's presented later. So the supplier must be under pressure. Just the sheer factor is submitting is a good start. As I said, if they don't want to agree on that, that's a red flag for sure. Even if they, you know, have to submit it later. No agreement. Red flag for sure. Start looking for somebody else.

Nico Johnson

(52:42)
I'm assuming that Leni and Will are in agreement on that as well. All right. Well, I got one for you, Leni and Will: do you have any different approaches to quality assurance with different types of projects?

Leni John

(52:59)
Yes. Out of necessity you know, during covid it was extremely challenging, right? Because of restrictions and shutdowns and all of the protocols that needed to be taken place. For a lot of the inspections, we had to kind of adjust our approach given different situations at different factories. But yes, depending on the factory and the data we get from PVEL and CEA we take different approaches, especially during circumstances that are challenging. You know, one of the things we rely heavily on is the intel that CEA provides us in their market intelligence report based on different factories and the historical rejections that they've seen coming out of different factories. So based on that, we can customize also our focus on different areas where we feel our weak points with different suppliers. So each supplier requires a customized, most of the time, customized approach to inspection and quality assurance. And that's something that we do routinely.

Nico Johnson

(54:22)
Very good. Thank you. So we've got a few more minutes here. We're gonna go, we're gonna try to crank through a handful of more questions. We've got more than we will be able to answer. So the CEA team will follow up with answers curated from the panellists for questions that we didn't get to. I want to direct the next one back to you, Tristan. I think this is a really interesting perspective on the comparisons of BOMs. So did you find any major differences in the quality of modules manufactured by different manufacturers using the same BOM combination?

Tristan Erion-Lorico

(54:56)
Yeah. We have seen that. If you look at the market share for encapsulants or back sheets or glass or junction boxes, there are some manufacturers that are well-known. And we've seen that those well-known manufacturers if they're produced in a different factory under a different quality control plan, that that well-known BOM can have significantly different results. And I think a good analogy for this, and a plug for CEA'S newsletter is; last Christmas or holiday season, they sent out some recipes to be used. And George provided a recipe for these amazing looking Greek cookies. And if you gave me all of those ingredients, I'm sure they would be inedible, no one would eat them, because I don't have the know-how that George has when making those cookies. And if you take the same module components and you give them to a factory with poor process control and poor quality control, those modules will be inedible and you will not want to have them on your project. So you can't just look at using the same BOM is, that that should give you a bit of a warm and fuzzy, but it can't be a replacement for ensuring that they do a good job actually putting those materials together.

Nico Johnson

(56:26)
I love the cookie test. That's a really great example, Tristan. You're always one for good analogies. Thank you for that. I think we've got time for two more questions. I'm not sure who would want to answer this one. I'm gonna ask, it's a little bit of a longer question. And then I've got one more left for you, Tristan, after this one. So seeing the presentations, one of the important points is that you need to have a solid contract to successfully raise claims for this, you have to have rather an extensive list of examples with problems that would be claimable. Therefore, where can one start, and where does it actually end? Or am I misunderstanding generally how this works? Is there a list of things for folks to know how to look through? We'd like to take that one first.

George Touloupas

(57:16)
Yes. So I mean, this is really contract review and every contract is different, but having a professional doing contract review not talking about the legal, although this is sometimes connected with the technical, it's extremely of extremely high value. And CEA does a lot of contract reviews. So there is no one size fits all approach here because every deal is different. Every geography is different. Every time is different as well. So very different two years ago than now. I would say the golden standard is called 'gold' because it's perfect, but you probably get like bronze, thin, depending, silver. But that's the reality. But the content is there. Now, prioritizing that and making it claimable: this is on a case by case. So you might end up negotiating an arrangement where there is subsequent testing for the next five years depending on the suspected outcome. And we see that happen as well. There could be LDs, it could be a combination of these two. But definitely, you need an expert to review having expert knowledge of what the same suppliers doing with others in the same of other geographies always helps. Yeah, so advisory is very important. Good advising.

Nico Johnson

(58:52)
Yep. So as you might have expected from the answer, there's not a checklist, at least not one that you'll get shared here on the webinar today, but there is a deep bench of expertise from those represented on the webinar and in all cases, good to have someone looking over your shoulder and helping make sure that you are checking the boxes. I've got time for one more question. I wanna say thanks again to the 75 of you who are still hanging on to our last words. Tristan, this one is directed to you. Your slide showed that the DH 1000 testing didn't show an issue with DH 2000 identified while IEC 61215. Will IEC 61215 be updated to DH 2000 to catch this type of issue?

Tristan Erion-Lorico

(59:39)
Yeah, good question. And I'll extend that to all my slides. You know, in TC and in static mechanical load and in PID, all of them, the certification, the IEC 61215 certification test did not catch the failure that the longer PQP test identified. But we have to remember that certification test is setting the baseline for the industry. It's saying: you need to pass at least this much to participate to sell your modules in this jurisdiction. You know, it's, it's not saying that this is a good 25-year investment, 30-year, 40-year investment. It's just saying, here's the baseline. If you can't meet this baseline, you can't sell the products. But that's the question IEC is trying to answer. The question the PQP is answering is, is this a worthwhile investment? So the 61215 test isn't going to go to the PQP durations because that's not what it's there for. It's just setting that minimum baseline. And that's what we have to realize IEC and certification is to do. And if you understand that, then there isn't a gap that IEC is trying to fill. You're trying to make it answer the question that it's not designed for.

George Touloupas

(01:01:01)
Can I just add to that that there is a technical specification that was published last year. It's an IC 63209 dash one, which is basically the PQP, well, PQP has some more sequences. So IAC is trying hard, they've been trying to do that for 10 years, but it's a technical specification that is not a standard. There's no pass-fail. It's like a recipe test, which is good. It's a good start.

Tristan Erion-Lorico

(01:01:28)
Yeah, yeah, it is a good start. PVEL assisted with bringing that, over the 10 years, to the industry. But again, it's not, that's not the 61215 and you're not going to get, you know an authority with jurisdiction saying you have to do 63209. As they say, you have to do 61215 because they want to be sure the modules are safe and meet that minimum bar.

Nico Johnson

(01:01:54)
Well, thanks to everyone who joined us today and also showed up to present from a deep bench of experience. You've been watching the holistic approach to procuring quality PV modules. We've learned to contract diligently, test thoroughly and inspect carefully. On behalf of the panellists and CEA, I would like to say thank you for joining us. My name again is Nico Johnson from Suncast Media. Please take a moment to follow CEA, PVEL and Strata. They are leaders in the industry for a reason. They have deep experience in what they're doing. You can find them on LinkedIn. As Tristan suggested, I encourage you as well to subscribe to the CEA newsletter for all kinds of goodies and tidbits. Sign up to receive Tristan's Worldclass report and the PVEL downstream Partner Network. You can see the contact there. And lastly, Strata is one of the largest installers in the country for a reason. These guys really know their stuff, so make sure you're following them. They often share from their experience so that you can learn along with them on social media. Thank you to all of you panellists for joining us, and thanks guests for taking time out of your busy day to learn from us.