Refinancing or selling your PV assets?

But are you sure that the operating performance of your portfolio is correct?

The European market has been a leader in the development of PV assets since the beginning of the 21st century. Nowadays, gigawatts of capacity are being operated for several years all around Europe and many players are looking now into financial optimization of their business by either refinancing the assets or selling them.

Showing the operating performance of your PV asset or portfolio is a critical aspect when assessing the relevancy of financial optimization. When looking at the different renewable energy technologies, PV might be considered as the most decentralized one as it is characterized by portfolios of many relatively small plants located in a large geographical area and based on different components and equipment. Additionally, standards have not been developed and implemented by taking into account the way to calculate operating performance.

Re-financing is mainly interesting when risks (and thus uncertainties) can be reduced. Due to the heterogeneity specific to PV, it can lead to some misleading ideas concerning the operational performance of a portfolio.

At 3E, we have been developing our knowledge for years now regarding operating behavior of PV plants and the best way to measure it. When looking at a portfolio of plants, we always start with an in-depth analysis of how irradiation and yield are measured. In most cases, we see that porftolio’s are not uniform, leading to inaccurate performance estimations which results into erroneous P50/P90 values used in models evaluating the actual behavior of the assets.

Despite this lack of uniformity, 3E has the capability of assessing the real performance of portfolio’s thanks to its inhouse knowledge and tools.

In the case where inappropriate irradiation measuring equipment is used (see table below showing the theoretical accuracy of different pyranometer classes), we select data from carefully calibrated satellite sources (see chart below comparing satellite data sources). When performing an assessment for a plant operating for more than 1 year, this calibration gives us results close to the uncertainties of the best in class onsite installed pyranometers. Knowing that most of the sites are not equipped with the best in class pyranometer or that these devices are not always maintained appropriately, 3E’s approach has real added value.

Next to the review of meteorological considerations, defining the real yield produced by a plant and the availability and reliability of the plant (or the grid) is also an exercise which requires experience based knowledge and methodology.

Previous experience has shown that assessing the performance of plants based on operating data, sometimes lead to deviation of more than 5% when compared to initial provided reports. Such differences are considerable as this is the order of magnitude between an over-performing and an average portfolio’s or between average and poor performing.

If you consider re-financing your portfolio or acquiring an operating portfolio, it is thus recommended to have first a critical look at the numbers you present or to those that are presented to you by appointing a credible and experienced independent technical advisor.