7 questions about operations & maintenance in the UK solar PV markets, answered by two professionals specialized in O&M. William Silverstone leads the company Silverstone, which maintains 10% of the UK's ground mounted PV installation; Mark Turner is Operations Director at Lightsource Renewable Energy, the largest portfolio owner of the UK (and second largest in Europe) that arranges most of its O&M activities in-house.
William Silverstone (CEO - Silverstone)
William Silverstone is a qualified electrician with specialist experience of Solar PV. William is the CEO of Silverstone Green Energy installing small scale Solar PV and Maintaining Utility Scale Solar PV.
With deep technical knowledge as well as business experience William leads a business focussed on technical expertise and customer satisfaction.
Now maintaining 10% of the UK's ground mounted Solar PV Silverstone Green Energy is a respected and rapidly growing business constantly on the lookout for talented individuals to complement the team.
Mark Turner (Director of Operations - Lightsource)
Mark Turner is Operations Director for Lightsource Renewable Energy, the UK’s largest solar developer and operator. Mark is responsible for the infrastructure that supports the effective running of all the Lightsource businesses. Since the beginning of 2013, Mark has been building the Lightsource Services business including the Operations and Maintenance Team which currently consists of over 25 highly qualified engineers and technicians delivering services to over 500MW of PV solar and acting as custodian for over 1600 hectares of the UK countryside.
Previously Mark has served as Strategy Director for AXA in the UK; as a Change Management Consultant in diverse environments such as submarine overhaul, banking, distribution, pharmaceuticals and as an Operations & General Manager for semiconductor manufacturers such as Plessey, GEC and Mitel.
1. Compared to markets as Germany, Spain and Italy the installed PV capacity in the UK is relatively young. Is the UK market actually behind with respect to operations and maintenance of PV plants and does it benefit sufficiently from the fact that best practices have already been developed (to a certain extent) abroad?
William: Not really. The laws governing Health & Safety differ from country to country and as such what is acceptable in one territory is often not acceptable elsewhere. Different pay scales to send engineers to site can also tip the balance with regards to when it is economical. I think the UK O&M market will need to mature on its own.
Mark: There are benefits that can be taken from the lessons that have been learned in other countries or territories, but whether it has been depends on the companies involved. Some UK companies have brought in knowledge and experience from elsewhere - which can be extremely beneficial. However, each country has its own specific requirements so there is a balance which must be struck between PV specific knowledge and country specific knowledge. As examples, Health and Safety implementation and reporting in the UK is particularly rigorous, and working styles and practices vary between countries. Even the PV specific issues can vary. Cleaning is a different challenge in the UK; humidity and heat combine in the UK in ways that are similar to parts of Germany but very different from Spain and Italy.
2. What kind of installations do you currently provide O&M for and why is that the focus of your company?
William: We provide O&M for our own micro generation (Sub 50KWP) installations but the majority of our work is solar farm services to ground mount utility scale installations.
In the volatile world of renewables it can be difficult to secure stable workflows. O&M gives us an opportunity to secure reliable revenues long term.
Mark: We provide O&M services for utility-scale ground-mount PV plants, as well as mid and utility-scale roof-mount installations. It’s the quickest route to build a scale organization and also aligns the O&M services to the sites Lightsource has invested in.
3. So far we have seen that the perceived relevance of implementing professional asset management and O&M in a market increases over time. What would you call the two main developments in these fields that you’ve seen over the recent years?
William: The market goes through different stages and the rush to build understandably has O&M as a very minor issue. The “hot” money that starts the market is giving way to “big” money who seek large portfolios and who have more interest in O&M. The difficulty is that “big” money often has unrealistic expectations of risk, perhaps because of what they were sold.
The other major development is the emerging quality. Early plants in the UK were simply not so well constructed and the components were not so good. As time passes EPCs become better, learning from their mistakes and the apparatus that they install improves all the time.
Mark: One of the first main developments we have seen is the emergence of professional O&M service providers that aren’t simply the bolt-on to construction businesses. O&M has evolved and works in conjunction with many different parts of an organisation.
Secondly, the development of systems that allow for the not only the operation and maintenance of PV systems, but actually allow companies to start fine tuning systems which can actually lead to gains in performance. We are no longer just looking to make things work as they should, but actually looking for ways to make things work better than they have done before.
4. What are, in your view, the main components on which an O&M provider should be judged and the performance of a plant be evaluated?
William: Health & Safety is the hidden risk for owners. The cost of an accident travels all the way back to the owner who needs to have done everything practicable to have avoided the accident. The larger and wealthier the owner, then more is deemed to be “practicable.”
The performance of the plant needs to be measured in terms of availability of components of the plant. Clever data analysis can be used to analyse performance but nothing will beat the questions of a knowledgeable asset manager. Relying entirely on contracts would be like trying to write a contract for a marriage. It is with dialogue that an O&M provider should be tested and judged. After all its not the fault of the O&M if you bought a lemon.
Mark: The O&M provider should be judged on the consistency at which they can deliver. It’s easy to be able to make a few improvements, but delivering that at scale across a wider number of plants is what O&M service providers should be judged on – especially in terms of response and performance times. You have to have strength in depth which means the people, the equipment and the infrastructure to support a high level of consistency. In an environment like the UK, PV plants are close to local communities so it’s vital we maintain good relationships with those communities by making good use of local services and contractors, as well as delivering good custodianship of the land.
5. Which of these is/are in your experience the most hard to deliver for an O&M provider and what are reasons for this?
William: Evidencing Health & Safety is an onerous paper exercise which can be a real headache but safe working practices are dependent upon individual practices and company culture which is hard to assess hence all of the paperwork.
The difficulty with availability and performance requirements is the categorizing and exemptions provided for when the failure is not the fault of the O&M or more importantly the repair is beyond the control of the O&M. Transformer lead times are a minimum of 6 weeks and significant electrical fire can cause damage that will take even longer to repair. This risk either rest with the owner or the owner must pay a premium to shift that risk to the O&M.
Mark: Consistency. Having your own team of people who can manage all aspects of the O&M process allows you to achieve a higher level of consistency. No matter how good your processes are for vetting subcontractors there is no substitute for having everything in-house.
6. What characterizes contracts in the UK for O&M of newly built rooftop and ground mounted PV plants? After how many years do most of these first contracts open up in general?
William: The initial period contracts are generally with the EPC who has different requirements to the end client. The EPC normally has a 2 year warranty to honor and during this period they choose the O&M contractor. After the warranty period the negations with the owner tend to be more involved as the owner has lost the comfort of a liable party they are keenly considering risk in a new way.
Often with a mix of in-house and external contractors. EPC often have monitoring and control in-house.
Mark: UK contracts can be very demanding. There is a very high level of expectation from the services provided. It doesn’t matter whether you are operating in a high tariff or a low tariff environment, there is an expectation of a gold standard service and that the highest levels of quality are maintained.
7. The government has recently announced its withdrawal of support for the ROCs for projects larger than 5MWp and at the same time the introduction of Contract for Differences (CfDs) is there. Looking ahead towards these upcoming changes, how do you expect the market to change and how does this impact/result in opportunities for O&M providers in the UK?
William: The larger projects will be even more tightly constrained regarding costs. This means that O&M negations are likely to be even tougher. But there is a possibility that we will see an increased number of Sub 5MWP plants coming through. The challenges of maintaining 50MWP over one or two sites is quite different to managing it over ten sites.
One thing is certain and that is that the industry is going to see constant change and the size of the plants being built will fluctuate. I for one love the changing landscape, it makes work even more fun.
Mark: There will be fewer companies developing and investing in PV plants. You will also start to see a move towards smaller plants with the development of more sub 5MW plants built. There will be more pressure throughout the construction process on cost and prices, so there will be a higher risk of a lower quality of finished product. An increase in smaller plants will see the need for a more agile O&M process. If you have plants that have issues during construction you will need people who can fix as well as maintain. I think we will start to see a consolidation of O&M services as sub-scale provider exit.
Even with the impending changes to the PV market, the opportunities will continue to be there. The ability to manage both roof-top and ground-mount contracts will certainly be important. O&M providers who can rise to the challenges presented and provide greater resources, flexibility and agile services should thrive.