The Five Most Common Challenges of Commercial Solar EPCs

Even the most seasoned EPC firms encounter setbacks in the solar market. Facing project rejections from AHJs or tackling utility interconnection challenges is a natural part of the process. The key lies in learning and embracing these challenges as growth opportunities!

By understanding and effectively addressing these challenges, you can not only overcome setbacks but also position yourself as leaders in the solar industry. Let's explore the 5 most frequent constraints and uncover strategies to turn them into competitive advantages.

1. Site Survey: Why are site surveys for commercial projects more complex than residential ones?

Because commercial sites often bring a whole new level of complexity compared to residential projects. Imagine you’re working on a large manufacturing facility. You’re not just checking roof measurements; you also need to collect data on the structural members, existing electrical infrastructure, potential shading from nearby objects and structures like chimneys, HVAC units, adjacent buildings, etc. along with photos and videos. Of course, both residential and commercial projects require similar data points, but the quantity and complexity of information necessary for C&I projects are significantly greater.  

And if you’re dealing with ground-mounted systems, there’s even more to consider — soil composition, drainage patterns, the environmental impact, and more.

Therefore, it is essential to do a detailed site assessment, so that the design engineers can visualize the site’s actual conditions precisely. Ultimately, your system’s efficiency and performance will remain uncompromised.

2. Permits and Regulations: What makes handling regulations and permits such a significant challenge?

When managing DG solar installations, you face several regulations and permitting processes that can vary geographically. Say, for example, if you're working in a solar PV project for a commercial warehouse, timelines can be particularly challenging; there are scenarios where the permitting process can take more than a year, as seen in the case of California, where the combination of stringent environmental regulations, complex zoning codes, and high demand for solar projects can contribute to extended permitting timelines. The reasons are many - inadequate knowledge of codes, lack of technical expertise to analyze rejections and resolving it, inexperience handling compliance procedures of AHJs and Utilities, and so on. Hence, this underscores the importance of thorough planning and understanding of local regulations to ensure timely project completion and compliance.  

To surpass these rules effectively, expertise in local codes is crucial. You'll need to proactively engage with solar permitting authorities by submitting detailed engineering plans, obtaining thorough environmental impact assessments (EIAs), and ensuring all electrical works align with the National Electrical Code (NEC). Balancing compliance with project timelines is also essential, as it significantly impacts both costs and schedules. In that line, here are 2 more aspects to consider:

  • Code Compliance Matrix: Create a code compliance matrix outlining how each aspect of your solar installation meets local, state, and national codes. This document should specify adherence to zoning laws, fire safety regulations, and seismic requirements appropriately.
  • Timeline Integration: Integrate a visual project timeline into your documentation, highlighting key milestones for permitting submissions, reviews, and approvals. This ensures alignment with project schedules and avoids delays.

Remember, permit applications undergo rigorous scrutiny by AHJs. Missing information, technical errors, or non-compliance with even a single code can lead to delays or outright rejections!

3. Design and Engineering: What makes designing a commercial solar system so technically challenging?

Designing a commercial solar system involves intricate engineering and technical considerations. A critical challenge lies in comprehensively understanding the existing building infrastructure: incomplete information can trigger a cascade of costly errors.  These include improper interconnection strategies that compromise system efficiency and safety, selecting the wrong attachments and equipment that put undue stress on the building, and potentially miscalculating the structural stability of the building itself, which can jeopardize its integrity. Failing to integrate these regulations can result in non-compliance and safety hazards.

Indeed, a lack of passion for solar technology can impede innovation and excellence in design! Because engineers who are genuinely invested in the industry are more likely to stay informed about the latest trends, techniques, and regulatory changes, fostering a collaborative and dynamic approach to designing DG solar projects.

4. Incentives: How does capital investment impact commercial solar projects?

EPCs must reduce project costs and offer detailed financial modeling to make solar projects more appealing to potential clients. Understanding and accessing the right incentives and rebates is crucial to reduce the financial burden off the customer, but it can be tedious and complex.  

So, how do you overcome them? You need to focus on leveraging expertise in taking advantage of applicable incentives and rebates to help clients make optimal investments. This approach not only convinces customers but also wins competition and ensures the project's financial viability.

But the best part is you can:

  • Reduce Upfront Costs: By factoring in available incentives and rebates during the initial financial modeling, you can significantly reduce the upfront investment required by the client. This makes solar power a more attractive option for businesses with limited initial capital.
  • Optimize ROI: Your knowledge of incentive programs allows you to structure financing options that maximize the long-term financial benefits for your clients. This can include strategies to lock in favorable rates for PPAs or identify grants.

5. Sourcing: Are there any constraints in procuring project materials?

Yes. Just-in-time (JIT) poses a significant challenge in DG solar projects. If essential project materials, especially those with longer lead times, are not delivered on schedule, the entire installation schedule gets thrown off track. This can lead to:

  • Disgruntled clients facing project completion delays.  
  • Difficulty scheduling labor resources efficiently, potentially incurring additional costs for overtime or idle crews.
  • Domino effect delays on other project phases.

Plus, in an effort to meet tight deadlines, crews may be forced to improvise with readily available substitutes leading to installation flaws or inefficiencies (due to using mismatched components), potential safety hazards if incorrect materials are used, and even potential need for rework or component replacement later, adding further costs and delays!

Here are a few strategies to mitigate JIT risks in DG solar projects:

  • Early Material Planning and Procurement: Thorough planning and early procurement of materials, especially those with longer lead times, are crucial.
  • Building Strong Supplier Relationships: Developing partnerships with reliable suppliers who prioritize communication and transparency reduces the risk of unexpected delays.
  • Safety First, Always: Never compromise safety by using readily available substitutes that are not specifically designed for the project.
  • Flexibility and Contingency Planning: Building flexibility into the project schedule allows for some buffer time in case of unforeseen material delays. Having contingency plans in place helps minimize disruptions.

The solar market growth rate is projected to continue its upward trend. Well, projections estimate that global solar installations might reach an impressive 4.7 terawatts by 2050. This ambitious goal highlights your role in advancing towards a sustainable future. As EPCs, you face multifaceted challenges, but make sure you discerningly address the most common ones by conducting highly accurate site surveys, partnering with an experienced engineering design firm like Illumine-i, staying abreast of regulations, and being passionate about implementing sustainable installation practices!

Although over 162 gigawatts of solar capacity have been installed nationwide (enough to power nearly 30 million homes), there are solar power problems waiting to be addressed. By effectively overcoming these hurdles, businesses, communities, and our environment can fully harness the vast potential of the sun for mutual benefit.