When considering proposals for a commercial solar power system - whether under a Power Purchase Agreement (PPA) or a rent-to-own arrangement – it’s easy to focus on headline numbers like savings estimates and electricity tariffs.
But there’s a crucial underlying assumption that will significantly impact those figures: the forecast yield of the solar system.
The forecast yield refers to the expected electricity generation from a solar PV system over its lifetime.
Decentral Energy manages over 100 integrated solar PV, battery and/or generator energy solutions across South Africa. These plants provide data to validate the models we use to forecast solar yield and underpin the financial savings we forecast.
Forecast yield is expressed as kWh/kWp per annum - in the highest yield parts of the dry Northern Cape, yields can reach as high as 1 900 kWh/kWp per annum, whereas in the cloudier eastern parts of the country, yields may be in the region of just 1 300 - 1 400 kWh/kWp.
This projection is influenced by factors such as system design, panel aspect and orientation, shading, local climate conditions, and the quality of components used. However, different solar providers use different methodologies, assumptions, and levels of optimism when presenting these forecasts.
A provider that assumes a higher solar yield will show greater forecast savings, lower energy costs, and a more attractive financial proposition. But if that forecast is overstated and actual performance falls short, the promised savings will not eventuate, leaving the customer with an unfavourable and likely unexpected financial outcome – especially if the deal is a take-or-pay or fixed monthly lease payment.
Solar irradiance data – a measure of the amount of sunshine an area gets on average. Some providers use long-term, high-resolution datasets, while others rely on less accurate averages.
Panel degradation assumptions – all solar panels degrade over time, but the rate varies. Some forecasts assume unrealistically low degradation rates.
Shading and soiling considerations – partial shading, accumulated dirt and dust, and seasonal variations affect output. Note that partial shading impacts the performance of the whole solar array, not just the panel shaded. Are these factored in accurately?
Temperature and system losses – heat impacts efficiency. Are inverter and cabling losses considered?
Maintenance assumptions – Some forecasts assume perfect maintenance, while real-world conditions may lead to downtime and reduced performance.
Forecast load-shedding events and outages - A grid-tied solar system, without battery or generator integration, does not produce when the grid is down, so the number and frequency of outages will reduce the average yield. Even a generator-integrated solar system will underperform during outages, reducing average yield.
When comparing offers, customers should look beyond the headline savings numbers and also compare the underlying forecast yield assumptions:
A solar provider offering a deal that looks significantly better than competitors might not necessarily have a more efficient system design, lower procurement costs or cheaper financing - they may well simply be making more aggressive assumptions about solar yield.
To make an informed decision, customers should ensure they are comparing apples with apples, not apples with pears. A realistic forecast, even if it looks slightly less optimistic, can ultimately lead to more reliable savings and a better solar experience over the long term.
By carefully assessing forecast solar yield assumptions, businesses managers and body corporate trustees can secure a solar agreement that delivers genuine financial and environmental benefits - without unpleasant surprises down the road.
