ALBERTA’S SOLAR PV VALUE CHAIN OPPORTUNITY 26 November 2018, Calgary, Alberta 1 2018-11-29
Disclaimer 2 ¨ While this document is believed to contain correct information, Solas Energy Consulting Inc. (“SOLAS”) does not make any warranty, either expressed or implied, nor assumes any legal liability or responsibility for accuracy, completeness, methodology, usefulness, reliability, or current status of any material contained in this document (“Report”), nor shall SOLAS assume any liability with respect to any matter or information referred to or contained in the Report, nor shall any person relying on the Report (“Recipient”) or any party to whom the Recipient provides the Report or information have any claim against SOLAS arising out of such Report. The interpretation of this or any other data or report related to this project is solely the responsibility of the client. 2018-11-29
Authors 3 ¨ Jackie Gallagher, Solas ¨ Caitlin Lopez, P.Eng (Go Productivity) ¨ Jason Mah, E.I.T., Solas ¨ Adrienne McGarrigle, B.A., Solas ¨ Paula McGarrigle P.Eng. MBA, Solas ¨ Leonard Olien, M.Sc., Solas 2018-11-29
Acknowledgements 4 SPONSORED BY: THANKS TO: 2018-11-29
Purpose 5 Identify the solar PV value chain opportunity for 1. Alberta Determine Alberta’s ability to capture the solar PV 2. value chain. Identify the jobs associated with potential 3. deployment scenarios to 2030 Identify the existing training opportunities 4. 2018-11-29
What is a Value Chain? 6 A value chain is a set of ¨ activities completed within an industry to deliver a valuable product or service for the market. This study focused on Solar ¨ Photovoltaics only ¤ Rooftop solar PV and ground-mount solar PV n Does not include Building Integrated n Solar PV Energy Storage n 2018-11-29
Agenda 7 Introduction Value Chain Assessment Economic Impact Job Opportunities Training Assessment Priorities Next Steps 22-11 -2018
Introduction 1.0
Global Solar Industry 9 GLOBAL Solar PV cost is plummeting History 43% Between 2009 and 2017, the levelized cost of energy for utility-scale solar PV fell by 86 percent ANNUAL GROWTH 1 Solar PV historic growth has been meteoric SOLAR PV MARKET 1990-2016 Current 2016 global solar PV capacity is approximately 300 GW (Gigawatts) Solar PV cost continues to decrease GLOBAL The levelized cost of solar energy is expected to 20% Forecast continue to decrease by 25 percent between 2017 and 2022. ANNUAL GROWTH Solar PV deployment continues to grow SOLAR PV MARKET 2017-2022 Deployment is expected to grow globally at about 2018-11-29 20 percent per year by 2022. 1 Lazard, “Lazard’s Levelized Cost of Energy Analysis — Version 11.0” (report, 2017), 10.
Alberta and Solar PV 10 CLIMATE LEADERSHIP PLAN SOLAR RESOURCE ALBERTA’s SOLAR RESOURCE ENERGY FROM SIMILAR TO 30% RENEWABLES MIAMI, FLORIDA RIO DE JANEIRO , BY 2030 DEPLOYED BRAZIL 2018-11-29
Alberta’s Current Solar PV Market 11 DEPLOYMENT TODAY’s BUSINESSES 43 ALBERTA 305 SOLAR MW COMPANIES DEPLOYED 83% support TOTAL ROOFTOP TRAINING AESO CONNECTION QUEUE 16 Solar PV 86 PROJECTS TRAINING 4,547 MW PROVIDERS AUGUST 2018 2018-11-29
BROOKS SOLAR 15 MW AC 2017 FIRST DISTRIBUTION CONNECTED GROUND-MOUNT ELEMENTAL ENERGY 12 2018-11-29
Scope of the Analysis 13 What’s in? What’s Out? ¨ Timeline 2030 ¨ Building integrated solar PV ¨ Rooftop solar PV ¨ Energy Storage ¨ Ground-mount solar PV ¨ Research and ¨ Alberta deployment development only. 2018-11-29
Methodology 14 Results • What is the total value? Cost Estimation • Where is most of • How much value the value? is in each part of Value Chain • Where are the the value chain? Model jobs? Deployment • What are the life • How ready are stages and we to capture Scenario to 2030 components of the part of the value • How many MW chain? value chain? of solar PV by 2030? What is the split of ground-mount /rooftop solar 2018-11-29 PV?
Rooftop and Ground-Mount Solar PV Assumptions 15 Market Segments Community - Microgeneration Regulation Distribution Utility Scale Connected Commercial/ Residential Farm Industrial ¨ Assumption for SESA study ¤ Microgeneration = Rooftop assumption ¤ Non-Microgeneration = Ground-mount Applications 2017-05-10
Alberta’s Deployment Scenario to 2030 16 4,000 MW DC Utility - Ground Mount (MW) Community Generation (Distribution Connected - Ground Mount) (MW) Farm - Ground Mount (MW) MW DC Deployed UTILITY 2,081 3,000 Commercial - Rooftop (MW) Residential - Rooftop (MW) COMMUNITY 389 Utility 2,000 FARM/ 224 1,000 Community COMMERCIAL Farm/Commercial Residential RESIDENTIAL 566 0 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 1 1 1 2 2 2 2 2 2 2 2 2 2 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 Deployment and Growth Rates based on study U.S. Solar Market Insight Full Report 2016 Year SOLAR PV in Review 3 3,261 DEPLOYED 3 U.S. Solar Market Insight Full Report 2016 Year in Review, GTM Research and Solar Energy Industries Association . MW DC P. McGarrigle, L. Olien, C. Chiu, Alberta Solar Market Outlook — A view to 2030, Version 5.0, November 25, 2017. BY 2030 2018-11-29
Market Deployment by 2030 17 Utility Applications 1,727 MW AC (2081 MW DC ) Community/Distribution connected 322 MW AC (389 MW DC ) Commercial/Farm 7% of all commercial/industrial buildings, 178 MW AC , (214 MW DC ); 1% of all farms, 9MW AC (10 MW DC ) Residential • 470 MW AC (566 MW DC ), 12% of all residences 2017-05-10
VALUE CHAIN ASSESSMENT 1.1 Alberta’s Solar PV Value Chain
Six Life Stages of Solar PV 19 Operations & Development Design Manufacturing Install Decommission Maintenance 2018-11-29
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Alberta Solar PV Value Share – Rooftop and Ground-mount 22 18-05-2018
ECONOMIC IMPACT 2.1 Market Value for Each Value Chain Component
Alberta’s 2030 Solar PV Value 24 VALUE CHAIN MARKET VALUE SOLAR PV DEPLOYMENT SOLAR PV Solar PV $4.1 3,261 DEPLOYED MW DC Billion Dollars BY 2030 Value BY 2030 2018-11-29
Alberta Solar PV Market Value by Life Stage 25 $4.1B 2018-11-29
Breakdown of the $4.1 Billion Market Value 26 Cumulative Market Value by 2030 Rooftop Ground-mount Total (791 MW DC ) (2,470 MW DC ) (3,261 MW DC ) Capital expenditures ($M) $1,099 $2,761 $3,860 Operation & maintenance $63 $220 $283 expenditures ($M) Total solar PV market ($M) $1,162 $2,981 $4,143 Number of installations by 2030 96,576 99 96,675 Majority of value is in ground-mount applications capital expenditures. Rooftop market value is 1/3 that of Ground-mount solar PV. 18-05-2018
GEOGRAPHIC DISTRIBUTION Only about 10% difference in resource across Alberta. Potential Ground-mount Potential Rooftop Installations by 2030 Installations by 2030 Within 10 km of existing Edmonton 34,238 transmission, distribution systems and substations Red Deer 4,433 Calgary 38,428 Lethbridge 3,642 Most rooftop applications will be in the major cities 27 2018-11-29 Ground-mount will be along utility corridors
ECONOMIC IMPACT 2.2 Alberta’s Current Solar Value Chain and Capacity to Capture Potential Market Value
Supply Chain Model - Legend Qualitative assessment was completed based on the existing directories and knowledge of the industry. 29
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ECONOMIC IMPACT 2.3 The Value of Increased Market Share of Solar PV with Alberta’s Existing Solar PV Capabilities
THREE ASPECTS OF SOLAR PV MARKET 33 ALBERTA’s 1 Goods and EXTERNAL the value we 3 services that can capture CURRENT are unlikely to with our VALUE be sourced in current CAPACITY Alberta capabilities ALBERTA’s 2 Opportunity to GROWTH grow capacity and resources to access more OPPORTUNITY of the solar PV VALUE value chain 2018-11-29
ALBERTA’s 1 Alberta’s Current Capacity to Access the Solar PV Market CURRENT CAPACITY Value is 15% ($630M) of Total Market Value 34 CURRENT CAPACITY $630M ROOFTOP & GROUND-MOUNT (2019-2030) 2018-11-29
ECONOMIC IMPACT 2.4 Alberta’s Growth Opportunity Value
Alberta Solar PV Market Value by Opportunity 36 3 VALUE EXTERNAL ALBERTA’s ALBERTA’s 2 GROWTH 1 CURRENT CAPACITY OPPORTUNITY VALUE 2018-11-29
ALBERTA’s 2 GROWTH Alberta’s Growth Opportunity Value OPPORTUNITY VALUE 37 Development • Growth Opportunity: $537 million. • Legal, Finance and Commercial, Technical Advisers, Site and Design and System Design segments: Over $100 million each • Growth Opportunity: $1.3 billion. Manufacturing • Balance-of-system segment: $0.77 billion • Mounting system segment: $0.52 billion. Installation • Growth Opportunity: $377 million • Electrical works segment: $218 million. 2018-11-29
1 CURRENT ALBERTA’s Detailed CAPACITY Market Value Breakdown $4.1B ALBERTA’s 2 GROWTH 3 VALUE OPPORTUNITY EXTERNAL VALUE 38 18-05-2018
Manufacturing Opportunities 39 ¨ Significant value associated with manufacturing balance of system components ¨ Higher value components include: ¤ inverters, metering systems, transformers, combiners, optimizers, collector lines. ¨ Additional study is required in this area. 18-05-2018
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