HomeMy WebLinkAboutExhibit J - ASES Study a
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SALVAGE VALUE OF PHOTOVOLTAIC SYSTEMS
Joseph McCabe,P.E.
ASES Fellow
PO Box 270594
Littleton,CO 80127
e-mail: ei�er�yid�.as(u���maiLcom
ABSTRACT (Poly)PV.Model numbers included: Solarex MST 43 and
MSX 60,Shell SQ 75/80, Solec SP-102 and SQ-80,and
As photovoltaic(PV)system prices become less Siemens M55's. Some modules had been panelized,as
expensive,the salvage value can be increasin 1
important in life cycle economic calculations.This report st�ked�a dhhigh re a e�alu d�ogcrystall ne�PV modules.
examines data from historic utility salvage sales,
reliability perspectives,and an actua12011 salvage 3.ECONOMICS
operation.From 2005 to 2010, large volume PV modules
sold at salvage for a variety of pricing dependent upon Most engineering students are required to learn present
strength of glass,amount of easily recycled aluminum, value calculations for comparing the life cycle economics
industry reduced average selling price(ASP)of new of different systems solutions. These calculations include
modules and expectations for future energy production. capitol costs,maintenance costs,any gradually increasing
Reliability of product,both real and perceived,are costs or escalating costs(like an increasing electrical
important factars in resale valuations. utility bill)and salvage values.In the past,PV systems
typically didn't include salvage value because there
1.INTRODUCTION wasn't a recognized resale market.In addition,the life
Used PV modules have been selling for decades.In 1994 pre ent va ue salvage values w�e eecons�idered m nUmal in
the author purchased slightly brown,nine year old comparison to yesteryear's high capital costs.Removal
Siemens M-55's pulled from the Carissa Plains California costs should be factored into the economic calculations.
project;they worked we1L These modules were re-sold
again on E-bay six years later.The value of large scale Working modules have some value,based on the
salvage PV bids have been tracked since 2005—2010 and electricity they can generate for the remainder of their
in 2011 we performed a salvage value analysis on one of useful life. It is possible that high value,non-breakable
these bids. glass modules can consistently obtain half the going retail
2.LARGE SCALE SALVAGE SALES rate per watt.
A module selling for$0.20/watt salvage value at the end
The Sacramento Municipal Utility District(SMIJD)has of 20 years,using a 6%discount rate has a present value
been re-selling salvaged PV equipment since 2005.The of$0.06;however at$1.26/watt the salvage value is
table presented includes the technology based dollar per $0.39 today. Present value salvage values can now be
nameplate watt prices.Over 0.9 megawatts of nameplate subtracted from today's installed systems costs with
modules were sold during this period. confidence that they will be resold.
Winning bids ranged from$0.04 to$1.26/watt.The table 4.BANK ESTIMATION OF VALUE
shows minimum,maximum,average$/watt winning price
for individual lots and approximate nameplate wattage An investigation into large scale bank financed PV
sold that year.Modules sold included tandem amorphous projects indicates that banks use residual values ranging
silicon(a-Si),single crystal(Single)and polycrystal from 15-25%. Banks base this on 3rd party appraisals,
TABLE 1: SMUD WINNING BIDS 2005 TO 2010 SALVAGE SALES
Winning Bids from 6 Years of Surplus Photovoltaic Sales at SMUD
2005 2006 2007 2008 2009 2010
Price Per Price Per Price Per Price Per Price Per Price Per
Bid Lot T e watt T e watt T e watt T e watt T e watt T e watt
1 a-Si $0.46 a-Si $0.46 Single $0.78 a-Si $0.53 a-Si $0.07 a-Si $0.09
2 a-Si $0.46 a-Si $0.31 Single $0.66 a-Si $0.50 a-Si $0.06 a-Si $0.13
3 a-Si $0.46 a-Si $0.20 Single $0.77 a-Si $0.97 a-Si $0.04 a-Si $0.07
4 Poly $0.98 a-Si $0.22 Single $0.82 Poly $0.44 a-Si $0.06 Poly $0.23
5 Poly $0.75 a-Si $0.24 Single $0.73 Poly $1.15 a-Si $0.04 Single $0.13
6 Single $0.51 Single $0.66 Single $0.82 Single $0.54 a-Si $0.04 Single $0.13
7 Single $0.51 Single $1.04 Single $0.72 Single $0.83 Poly $0.17 Single $0.18
8 Single $0.61 Single $1.26 Single $0.48 Single $0.88 Poly $0.48 Single $0.19
9 Single $0.61 Single $0.77 Single $0.66 Single $0.76 Poly $0.24 Single $0.33
10 Single $0.61 Single $0.77 Single $0.82 Single $0.88 Poly $0.29 Single $0.04
11 Single $0.92 Single $0.78 Single $0.91 Poly $0.21 Single $0.24
�2 Single $0.82 Single $0.72 Poly $0.17
13 Single $0.52 Single $0.56 Poly $0.23
14 Single $0.72 Single $0.25
15 Single $0.65 Single $0.24
Single $0.17
16 Single $0.30
�� Single $0.16
18
Min $0.46 $0.20 $0.48 $0.44 $0.04 $0.04
Max $0.98 $1.26 $0.82 136$1.15 212 $0.48 160 $0.33
Total kW 150 69 177
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Photo 1: Stacked single crystal silicon salvage sales YV panels.
which the banks then reduced by 50 to 70%.Two reported ReCycling with headquarters in Tucson Arizona and
appraisals approaches used by banks include: additional collection point in San Jose CA.
1)An income approach Banks assumed a useful life of 35 6.ENERGY and GLASS
years for both crystalline and a-Si,then discounted back the
future energy revenues from years 21-35,back to year 20. Most PV technologies lose 1%per year in performance
Because of an anticipated rise in value of the electricity PV consistent with typical 20 year,80%power warranties.A
module would generate after 20 years,the 15 years of module with an original standard test condition(STC)
energy revenue(at year 20)results in very high residual power output rating of 100 watts will probably be producing
values(in the 50-70%range).This income approach 90 watts at STC after ten years,80 watts after 20 years.
recognizes that functioning modules will always have an Used modules can be tested for their performance using a
energy revenue value based on life expectancy and in max power point current/voltage meter,correcting for
comparison to future alternative electric generation costs. module temperature and actual solar radiation normalized to
the STC conditions of 1,000 watts per square meter and 25
2)A renlacement value anproach What might PV modules degrees centigrade cell temperature.
cost down the road,for a new buyer that had the choice of
buying used modules,or the same power generation It is important to note that the SMLID salvage sales
capability of new modules? A bank might assume a 5% illustrates a-Si on breakable float glass has considerable less
decline in the cost of a module every year,and a 5%gain in salvage value than single or poly silicon technologies using
energy value every year. When you factor in what a PV tempered glass(see Photo#2).CdTe might have similar
module should cost(without regards to oversupply/ issues with removability and transportability of the more
undersupply),based on these historical trends,you get a fragile glass compared with tempered glass of crystalline
value of what a person should be willing to pay per watt for PV. Even tempered glass is subject to breakage during
a used PV module at any given year,vs.the alternative of decommissioning,removal transportation and storage
purchasing a new PV module. activities(see Photo#4).If flexible PV like United Solar or
other newer flexible PV players in the market were designed
5.RESALE MARKETS for removability,it is possible the salvage value would be
even higher than glass based PV.
Used or salvaged modules are bought and sold in a number
of ways.In some cases,they can be installed into non-
incentivized systems like off grid markets.Or they might be
showing up in resale channels]ike on E-Bay,Craigslist or
classified section of Home Power Magazine. We were able � �,; �*�,.�, � "�'
�ez.. ,.. .rt,�..,,l� - �
to sell 15 year old modules for approximately$0.50/watt in . ' , �
2011. . �
It is possible individual modules are being sold into existing � , �� -� � � `
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systems where a component has broken.All modules in a , --
system should perform at exactly the same level,thus � ,
,.� ,., .
avoiding miss match conditions that reduce overall system �
performance. Similar to a fine china dinner set that has a ��
broken plate; specific modules have a high replacement Photo 2:Poorly handled float glass a-Si for bid 2005
value,even if they are a used module.If an existing PV
system has a problem with an individual module,replacing Visual factors including browning of EVA was an important
that module could have a very high system level value. factor for resale,with large amounts of browning,as shown
in the 15 year old single crystals cells of Photo 5,
Used modules could be sold into a wholesale green power dramatically reducing the resale value.
generator; however a tax credit or renewable energy credits
(RECs)for the installation would not be allowable because 7• SALVAGE OPERATION
the PV materials are not new.
In 2011 we examined the 144 Solec SP-102's 24 volt
Scrap markets can utilize crystalline cells,as well as the modules shown in photo#3 for the actual resale value.
aluminum frames,thus non-working crystalline modules Operating modules produced approximately 85 watts in full
can have an attractive scrap value.Various PV recycling sun,consistent with a 1%/year degradation.Performance
programs have begun around the world including PV was measured with a 100 watt variable resistor providing
voltage open circuit,short circuit current and an c�N" Po � �
approximation of voltage and current at max power in full ' z�E�; i
sunlight.Good modules with junction boxes sold on a �,., �"'^" ;r . { '
��� � � � ` ' s
roadside in Grass Valley CA for between$30 and$50 each. � ,� „ ., a,�� �
Modules without junction boxes sold in bulk for$20 each. `I � �� '''�• " �r.� �r' �
� , a
Approximately 15%of the modules were discarded because � ; �
of glass breakage,delamination,serious browning of EVA, , -y � "
obvious burn marks on interconnections or damaged &`
t • ,—
backsheets.Angle aluminum used to panelize the modules �
was salvaged at a high value. + �
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; ,
The time needed to transport,warehouse,clean,examine, ;-, - �
sort,inventory,and sell the surplus modules considerably . � : �
reduced the value of the salvage operation.Ideally modules } . .
�.
are taken out of service and immediately installed in a new �,,..�`"` "`,--��r �•
�
location.
Photo 6:Selling PV in northern CA 2011.
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_ � 8.CONCLUSION
... ...:� .y F - i.d/
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" „�„ There is a healthy resale market for PV modules that should
t r .�,
1�"�'�-- �'',----__� '��.. �t ��'` be recognized in project level economic calculations.As
's..:.-------- r.,....,.,►,.._� 1 �.' ,.� , ,:�`,�'
,�- -_`-, --�_ -�-�t � systems costs become lower and lower,salvage value have
.�'_ �`"'-_�� �y��`�' more significant ramifications. Functioning modules will
y =`"''**+w���'�'- ` � have a revenue value based on life/performance
--__
�_ '���" _�•�. �� expectations considering the additional shipping and
t �. ,`? handling costs in comparison to other alternatives to electric
t:._,_ , ;.. a
Photo 3: 1995 Solec SP-102's piled up in 2010. generation.The fragility due to glass used in PV modules
has important resale value ramifications. Non-glass
k •�� �«���� �`� -� .:k�..�*+��"'``" �•�e� ��, modules should have greater resale values because of no
r +:�� 'S.�.C.,'Si��' �s��+�'�'��S � , �
.,..,� „����z � potential breakage during removal,and resale.Over time,
��� ��'� �' x'� � bank residual values can be compared with actual salvage
� � � �w � � -� y s
�����;�„ �g �` �� '��, sales for accuracy in futwe assumptions.Safety and
!
4 ��' . ,�� . ' �; performance standards for used modules will become more
`��� ' ��:�.,w • '� �' important as salvaged modules show up in greater numbers
¢ . :r ,
°�,. in future years.
W �� �- ;
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t�wu ,,.,*�i��" `., . , 9.ACKNOWLEDGEMENTS
;a����1?,��em ,av�,N-a�..,_.'�„-r.�<,. , ,,, • . sK.�
Photo 4: Side by side broken and good quality modules. Thanks and appreciations are extended to Brian Robertson,
Jigar Shah,Daniel Shugar,Eric McCabe,Jennifer
�FN ;�,�3�'� ;' Woolwich,ASES and SMUD(Jon Bertolino and Lynne
��"' '$ ' Valdez).
� "���� `���'�`��j� � 10 REFERENCES
,r�.!.:
(1)Personal Communication,January 26,2009,Dan
,=.�i:-.- Shugar.
� (2)Personal Communication,January 25,2009,Jigar Shah.
�' (3)Personal Communication,January 26,2009,Brian
��i,�, � Robertson.
'���"�'nt�`��`. � � (4)SMiJD Salvage Sales,2005-2010(www.smud.or�)•
, �a�:, �
""'b`�`���v;.,''� (5)personal Communication,On-going,Jennifer Woolwich.
� ��� F, 'r�t (6)NREL PVRW 2010 BP Solar presentation
��,��� ,, �: � �, ;.
� �� �,,� � ;, ..���,� , pvrw2010_wohlgemuth.pdf
Photo 5:EVA discoloration.