Distributed Renewable Energy Operating Impacts and Valuation Study

Developing a Winning Business Case for Solar DE Deployment
that offer no advantage in solar DE promotion, and may actually diminish acceptance. Policy
transition and resulting changes in zoning and permitting could benefit or hinder the winning
business case.
Institutional Support
In some jurisdictions, homes with superior energy efficiency are awarded lower mortgage rates
because the homeowner will be paying lower utility bills and, therefore, will theoretically have
additional cash flow to make mortgage payments. Facilitating this change in Arizona will require
working with banks and other lenders in proving the efficiency of the solar DE systems.
Concurrently, the current appraisal community needs to be educated as to the value of a solar DE
system in order to be able to conduct accurate assessments of a home or business value. There is
a need to ensure that the appraisers understand solar DE systems are a positive, not negative,
improvement to the home. Increased home values due to the inclusion of solar PV or SHW will
tie to the banking community’s understanding and willingness to support larger, and/or lower
cost, loans.
New Business Model
During the course of the Study, the stakeholders confirmed many market changes underway in
business models and approaches. For example, third party equipment leasing and ownership is
becoming more common for commercial installations and may become the norm. This change in
business model may be replicated in an effort to address any of the three prerequisites for the
winning business case, namely the market, the technology, and the financing. By way of
example, Southern California Edison developed a new business model to meet its distribution
transformer needs. Instead of relying on traditional market purchases, it entered into the
international transformer supply chain to facilitate the raw materials acquisition and fabrication
of over one million distribution transformers to meet its system rehabilitation efforts.
APS may consider a new business model in which it directly provides services that help promote
solar DE market development. These could include such services as financial programs,
technology development, and supply partnerships, as well as design, billing and field support for
the installation of solar DE rooftop units in conjunction with the marketplace.
6.6.4 Installation Challenges and Opportunities
Alignment of solar deployment with a winning business case and successful market drivers will
require a significant expansion of solar installation capabilities. Current installation capacity may
be in line with current demand, but assuming increases from successful marketing programs,
rebate opportunities and customer pull, additional resources will be required.
Hitting the RES goals will require the installation of between approximately 18,000 and 400,000
solar DE systems between 2009 and 2025. This represents a large increase in the number of
installers in order to take advantage of the demand. In turn, this will require significant
investments in training and education. Currently, the installation community in the APS territory
is between 10 and 40 installers, each with a maximum capacity of 1 to 2 systems per day. This
will undoubtedly grow over time as demand rises, but the challenge is to pace the demand and
the addition of new installation resources.
Distributed Renewable Energy Operating Impacts & Valuation Study R. W. Beck, Inc. 6-21