kWh Analytics: Solar assets continued to underperform P50 estimates

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Climate insurance and renewable energy risk management experts at kWh Analytics released their 2022 Solar Generation Index report. Utilizing operating data provided by industry collaborators and their proprietary Heliostats database, the company identified a persistent pattern of solar asset underproduction across the country.

This year’s report finds that solar assets broadly continued to perform well below expectations, with 2021 operational data showing nearly 8% average underproduction on a weather adjusted basis. Furthermore, the report breaks down project performance by vintage and operational year to highlight the fact that projects constructed after 2015 have missed P50 estimates by 7- 13% in their first year of operation, a clear regression compared to production data from earlier vintages.

“Underperformance affects investors and lenders critical to the success and growth of solar projects,” said Jason Kaminksy, CEO of kWh Analytics. “As an industry, we must collaborate to find ways to course-correct in order to ensure the industry’s long-term financial health.”

For the first time, the 2022 report also evaluates asset performance as a function of project capacity and mount type, showing that the underperformance trend has not been isolated to any specific group of projects.

“It is imperative that we continue to support the long-term success of the renewable energy sector,” said Jason Kaminksy, CEO of kWh Analytics. “To de-risk investments into zero-carbon assets and encourage resilience throughout the industry, sponsors and lenders should consider accurately priced risk-transfer products, be wary of aggressive production forecasts, and be collaborative with stakeholders to encourage data sharing.”

kWh Analytics generates this index to promote transparency and discussion within the industry. The goal is to provide stakeholders with the necessary data to continue developing and operating solar projects that ensure the industry’s continued growth, and ultimately work together towards a decarbonized future.

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