The common belief is that solar farm decommissioning happens at the 25-30-year mark. However, what happens when the need for decommissioning arises much earlier? Various factors can lead to partial decommissioning, retrofitting efforts, or repowering, and preparing for these nuances and the potential for shifts that may occur from installation to full decommissioning is crucial for effective solar project management, ESG (Environmental, Social, Governance) Reporting, and environmental conservation. This preparation includes all maintenance and upkeep in between. Here are some reasons we’re seeing that decommissioning is happening sooner than anticipated and why having an end-of-life or decommissioning plan in place is essential in understanding future costs and timelines for the various degrees of decommissioning.
Estimating Panel costs. Panel upgrades for more efficiency
When estimating the value of your panels, it’s not so much the cost of panels that matters, per se; it’s more about examining the levalized energy cost over time and estimating the point at which higher efficiency will yield better returns for large-scale systems. Advancements in solar technology mean that newer panels are significantly more efficient than older models. Decommissioning old panels for upgrading can be financially beneficial as early as four years into a project. A well-maintained solar system can last up to 30 years, sure, but efficiency losses over time or technological advancements that occur within that timeframe can make earlier replacements financially advantageous. While the upfront cost of new panels might be high, the long-term savings in terms of increased energy production and decreased maintenance costs can offset these initial expenditures. Additionally, decommissioning and recycling solar panels are part of managing the lifecycle of a solar project, ensuring environmental and economic sustainability.
Regarding financial considerations, studies suggest that the recovered materials from end-of-life solar PV panels could be highly valuable, depending on their condition and age. For instance, it is estimated that the materials recovered from decommissioned solar panels could exceed $15 billion by 2050, highlighting the economic potential of recycling and reusing materials from old solar installations.
Source: MIT (Module-replacement strategy for silicon PV and emerging PV systems The top panel shows the annual output of the two systems. Top curves: Over 30 years, the output of both systems declines as the solar panels degrade. Bottom curves: The output from both systems increases when module are replaced at year 15, the emerging PV more than the silicon PV. The bottom panel shows lifetime cost per kilowatt-hour. Left bars: The cost of the silicon PV is about the same with and without module replacement. Right bars: Without replacement, the cost is higher for the emerging PV than for the silicon PV system. With replacement at 15 years, the emerging PV system is cost-competitive. Assuming continuing technological advances, the newer modules will always be better than the ones they replace.)
A shift in land-use
Sometimes, decommissioning happens early because the land use goals have changed. Sellers might accelerate decommissioning plans to meet buyers' preferences for upgraded solar technology or none at all. The sale of a property can necessitate assessing and possibly upgrading the existing solar infrastructure to increase the property's value and appeal to potential buyers. On top of that, legal and financial considerations, such as the transfer of solar panel warranties and the allocation of decommissioning costs, can impact the negotiation and sales process. There are many untold reasons why a decommissioning might happen under these circumstances.
Discrepancies in projected and actual solar output
Solar projects sometimes produce less energy than initially promised, leading to financial and operational underperformance. When actual output falls significantly short of initial estimate proposals, stakeholders may consider early decommissioning or upgrading the system to meet expectations. These discrepancies can arise from various factors, including overestimation of system output, unforeseen shading, or degradation of panels at a faster rate than anticipated. Accurate forecasting, regular performance monitoring, and maintenance are crucial to avoid premature decommissioning and ensure project viability. Addressing potential output discrepancies early on can prevent larger financial losses and support the ongoing success of the solar project.
Damage from harsh weather conditions may impact solar systems
Extreme weather events, such as hail, have caused significant damage to solar panels on various sites throughout the country, affecting their lifespan. The impact of such damage can accelerate the need for decommissioning or comprehensive system repairs. Case studies have shown that severe weather can lead to cracked panels, reduced output, failed inverters, and, in some cases, complete system failure. To mitigate these risks, solar projects should incorporate robust design considerations, select appropriate materials for the specific climate, and implement protective measures like panel covers or reinforced mounting structures. Strategic planning for weather-related risks is essential to ensure the durability and reliability of solar installations, minimizing the likelihood of premature decommissioning due to extreme weather damage.
End-of-life solar equipment
When a site younger than ten years is decommissioned, most of the panels in good condition can be put back on the secondary market for reuse and resell. From what we’ve seen, about 10% of those panels are estimated to be broken or unsalvagable and must be recycled. Racking and removed piles can be recycled for their scrap value. Batteries, inverters, transformers, and other equipment can be recycled or refurbished. There are many markets to consider for the afterlife of early retired solar equipment. Finding the best plan for your project is something Green Clean Solar offers consulting on.
The importance of solar decommissioning and retrofit plans
While price projections into the future may be volatile, getting an estimate of what your decommissioning project would cost today, in real terms, is helpful for future planning. Such planning ensures that solar installations remain economically viable and environmentally responsible throughout their lifecycle. System owners can effectively address technological advancements, regulatory changes, and market dynamics by anticipating the need for decommissioning or retrofitting. This foresight minimizes the risks of obsolescence, ensuring that resources are used efficiently and responsibly.
A flexible decommissioning strategy allows project managers to adapt to unforeseen circumstances, such as premature equipment failure, parts replacement, changes in ownership, or shifts in energy policy. This adaptability can significantly reduce the financial and environmental costs associated with solar panel disposal and replacement. It also ensures the continuity of energy production by facilitating timely upgrades or replacements of the solar infrastructure.
Developers should integrate decommissioning plans into the project life cycle management from the outset. This integration can include setting aside financial reserves for future decommissioning costs via decommissioning bonds, planning for the recycling or disposal of materials, and regularly evaluating the performance and condition of solar installations to determine the optimal timing for decommissioning and retrofitting activities.
Decommissioning in the solar industry is not always a matter of a 30-year timeline; various factors, including technological advancements, property transactions, actual system performance, and environmental conditions, can influence it. The importance of planning and adaptability in managing solar energy projects cannot be overstated. Developers and stakeholders must recognize the evolving nature of decommissioning in the solar industry and prepare for it through strategic planning and ongoing management. This approach ensures the economic and operational efficiency of solar projects and supports the broader goal of sustainable and responsible energy production.
Do you need a clearer understanding of your site’s future decommissioning or retrofitting projections? We collaborate with you to create a strategic plan, helping you comprehend the associated costs and potential scenarios for your decommissioning options. Contact Denise from the Green Clean Solar team at denise@greenclean-solar.com to get started.
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