What are companies doing to develop insurance and maintenance coverage for solar panels where hurricanes threaten clean energy systems? In this Q&A, Michael Grasso, CMO of Sunnova, said that the combination of energy storage, solar power, and strong insurance is improving community resilience in Puerto Rico.
CEFF: Let’s begin by talking about an overview of the work that Sunnova has done in Puerto Rico to date.
Grasso: Today, Sunnova is the leading privately-held solar and battery storage company operating out of the United States. We focus across the United States and its territories - including Guam, Puerto Rico, and the Northern Mariana Islands. Our focus has been on bringing solutions to market that allow consumers access to solar for their homes where they can get a savings benefit against the grid services and grid prices where historically the utility would otherwise have been the only option for them.
We provide power purchase agreements (PPAs). We also offer lease options and loan options. For all of these, we build the capabilities and services for a 25-year agreement for the customer.
CEFF: How does the Sunnova Protect insurance offer work?
Grasso: It varies based on which product is offered in that state or territory and which product the customer has chosen. Leases are different from PPAs; they are also different from loans and/or finance agreements. Each has a slight variation. With all of our customers, we’re providing 25 years of coverage.
That means if any of our customers’ equipment breaks, malfunctions or expires, we will step in and repair or replace that equipment at our cost.
CEFF: Are you the only company that is offering a solution like Sunnova Protect?
Grasso: Our Sunnova Protect solution is unique in the industry. We’re the only provider that will guarantee service and provide that end-to-end coverage for the entire system for 25 years.
Some companies will talk about a warranty - but it may only apply to their panels.
Others may provide an end-to-end warranty for a shorter time period.
CEFF: What types of hurricane damage affect solar and storage systems in Puerto Rico?
Grasso: I think the situation we’re seeing in Puerto Rico is a little more unique than what we’re seeing in other markets. So, I can talk more generally and then we can talk more specifically about Puerto Rico.
Generally, what we’ve seen is that solar systems tend to be very resilient in storms. Typically, with high-wind storms, the solar racking and panels are installed in a way where they can withstand pretty aggressive wind speeds.
There are typically construction standards in the United States that dictate what wind speed the systems have to be able to withstand based on the proximity of the installations to the coast.
Florida is an example of that. When you’re on the coast, it’s up to 175 miles an hour. When you’re inland, it might be 150-mile-an-hour winds that the system has to be able to withstand.
What we’ve seen is that solar systems are pretty resilient. Typically, if the roof stays intact, the system stays intact.
Obviously, there are exceptions to that. When debris is flying, that debris can cause damage to a system. If there’s some kind of gust or wind activity that could cause damage to the roof or the structure itself, that could cause damage to the solar system.
The difference here is that in Puerto Rico, we faced another challenge - which is that the grid itself was damaged. And solar systems are only designed to operate when the grid is up. Nearly every utility in the United States requires that grid-tied solar systems stop sending electricity back to the grid if the grid is down. As a result, customers lose access to their solar systems when the grid is down unless they have storage.
CEFF: Let’s talk more about the grid issue. What exactly is your perspective on what’s going on with the grid in Puerto Rico?
Grasso: There has been grid restoration on a large percentage of the island. That restoration means the grid has been available. But it has not been consistently available – even in recent months. There have been both sustained and rolling power outages.
CEFF: When a storm occurs and systems are damaged, what steps does Sunnova do in response?
Grasso: We’re constantly monitoring our fleet. We have data that flows through each of our systems that belong to Sunnova so that we’re able to see what the health of the system is [from meters and inverters].
When we went through the hurricane, when the grid went completely dark, all our systems shut down. So therefore, we weren’t receiving any generation data.
Because Puerto Rico had such significant damage, we saw a variety of different issues there. In some cases, damaged panels or meters. In other cases, it was structural. Complete homes were… devastated or lost their roofs. Flooding damage caused other problems for the homeowners.
In all cases, Sunnova has gone in to repair or replace systems for customers and has worked to get them back up online and producing energy.
Over the last seven to eight months, Sunnova has taken a position where all new solar systems we install in Puerto Rico will come with batteries. We also make available to all our customers there the option to add batteries to their systems. It’s obviously an additional agreement and benefit, so there are additional costs to it.
We made batteries available for our lease product and our solar-finance-agreement product so customers would be able to be better prepared for when the next storm comes along. Now, when the grid does go down, not only will consumers have access to backup energy, they will also be able to generate energy - unlike if they had solar-only systems.
CEFF: There was a news article in Latino USA that said customers said they were paying more for solar services than they expected and were asking for refunds on some charges. Do you think that is related to the issue of having storage? Do you know why it is they were asking for refunds?
Grasso: No, I don’t know specifically why they were. What we’ve seen is – a couple of things. When our customers were out of service after Hurricanes Irma and Maria, one of the proactive measures Sunnova took was we reached out to them to let them know that if they weren’t getting any benefit from solar generation for their homes because the grid was down, we weren’t going to actively bill them.
The second thing is that we started installing batteries. I had a chance to go to Puerto Rico a couple weeks ago and meet with many of these battery customers. These customers are extremely positive about not just Sunnova but the idea that they can generate their own electricity, store their own electricity, and live off that electricity.
One customer lived off our solar-plus-storage solution for four months when they didn’t have any grid supply… The local community would come by to escape the heat, get access to something they could cook, or have a place to go that had lights on. It’s incredible.
CEFF: Can you tell me more about how customers have reacted to having a storage solution installed instead of just solar? What was their feedback?
Grasso: They’re learning to live with storage. Each customer obviously has a different situation in their home. Many customers are installing different types of air conditioning systems - typically your European wall-mounted models that plug into power outlets.
I saw in a couple of different situations, walking through customers’ homes and spending time with them, that they were looking at the statuses of their solar generation as the morning hours passed. And they were showing me how they were monitoring it on their phones or through their inverters. They would see what the systems were generating. They’d also be checking on the statuses of their batteries.
And because they all live in fear that the grid is going to go down again, they want to ensure the batteries have a minimum charge level. So typically, they’re living off the solar generation during the day at the same time as the battery is charging up. And as the evening hours approach, they start to live off the battery and want to make sure the battery will last through the night.
They really have adapted to a lifestyle which is revolving around their solar generation, which in most cases is more than sufficient to power their homes through the day and night.
CEFF: Is there anything else you’d like to add?
Grasso: We’re very bullish on solar plus energy storage. We’re taking a market-leader position on this. The solution we’re bringing - both the core offering and the enhanced protection - is really changing lives for consumers. It provides reliability and resiliency where people live so that they can have a better quality of life and feel protected during times of need.
Note: Kelsey Smith, communications manager at Sunnova, commented on the answers to this Q&A.