SolarCity launches into utility-scale PV and storage business

SolarCity, the largest US residential solar company, formally launched itself into the business of building and operating utility-scale PV and storage projects, having hinted for months that it would do so.

The move represents a major step in the evolution of SolarCity’s business, which today centres on installing rooftop PV systems for customers and collecting recurring revenue via long-term leases and PPAs.

SolarCity will begin offering a range of new services for utility and grid operators in the US – an entirely new class of customer for the company – including the sale of large quantities of solar power via wholesale contracts.

It will also offer to finance, build and maintain grid-scale battery systems and other distributed-energy resources that allow for services like like frequency regulation, flexible ramping and peak shaving – all increasingly important as more intermittent renewables are brought onto the US electricity system.

Long at odds with utilities due to its sale of behind-the-meter solar power and its support for net energy metering (NEM), there is growing evidence that SolarCity is learning to live and work with utilities.

SolarCity and several other solar companies recently filed a proposal jointly alongside large utilities in New York that would see NEM payouts reduced for homeowners in the years ahead, while ensuring a healthy market for distributed solar.

SolarCity’s push into the utility-scale renewables market will put it in direct competition with a range of major players, from First Solar to EDF Renewable Energy, the latter of which recently acquired commercial and industrial solar specialist groSolar.

Close watchers of SolarCity will not be surprised by the announcement.

Chief executive Lyndon Rive late last year said that SolarCity was already building utility-scale solar projects. Rive said that while the focus will be on plants less than 20MW in size, the company “won’t say no” to much larger projects.

SolarCity previously installed a 12MW(ac) utility-scale PV array in Hawaii, and in the same state it is currently building another solar project with integrated battery storage – perhaps the first such dispatchable solar plant in the country.

Chief technology officer Peter Rive told Recharge that the dispatchable solar project under construction in Hawaii is “what solar will look like in the next decade”.

As part of the announcement Thursday, SolarCity also unveiled a deal with a utility in the state of Connecticut that will see it installing, owning and maintaining 13MW(ac) of utility-scale PV and at least 1.5MW/6MWh of storage.

The PV capacity will be installed across seven sites in the state, with the power generated to be sold to the Connecticut Municipal Electric Energy Cooperative (CMEEC)  through a 20-year PPA.

The associated storage contract represents SolarCity’s first capacity services project. CEMEEC will be able to remotely control the batteries through SolarCity’s GridLogic control platform, allowing to it manage load spikes and optimise the performance of its distribution system.

SolarCity’s Connecticut projects are expected to be operational by the end of 2016.