High-tech solar

Paul Nahi interview, Part 2: Enphase’s CEO talks about Hawaii’s special solar needs, the company’s tech DNA, culture of quality, big data readiness

Enphase microinverter

In the first part of the SolarCurator interview with Enphase’s president/CEO Paul Nahi, he talked about the early days and how the one-time microinverter start-up’s idea has been validated in the marketplace. Paul also discussed the emergence of competition in the space and his company’s approach to dealing with it, the inherent complexity of the microinverter system technology, and the active engagement that Enphase has with utilities and standards organizations in addressing advanced grid management issues in an increasingly solarized energy economy. The second part of the interview ranges from Paul’s observations of the uniqueness of the Hawaiian market and the firm’s close relationships with local utilities there, his characterization of Enphase as a high-tech solar company, the strong quality control activities taking place at the company, and the coming of big data to the solar space.

“Hawaii is a bit of a microcosm; since it’s an island, they have to import all of their energy, and so energy there is very expensive, which makes solar very attractive financially,” he said. “The utilities have been very amenable to solar to date, and have helped its progress. At the same time, it’s a small geography, so the concentration is significantly more than in any other location in the U.S., so they’re seeing some of the challenges ahead of where other people see them.”

“We’ve done a lot of work with some of the local utilities,” he continued. “Awhile back, the utilities noticed that there were greater voltage fluctuations than they had experienced in the past, and they requested that we modify our inverters to support what they wanted to do, which was to create a wider voltage window. We had long discussions with them and came up with a plan. Because of the bidirectional communication capabilities within each of our microinverters, from our offices in Petaluma we were able to modify the parameters on the microinverters across the island on all Enphase sites to support the utility’s new requirements.

“We are doing other tests with them on other features and functions that they’re interested in, to help them manage a greater and greater DG [distributed generation] load. We’ve got test sites with them that we’re experimenting with, there are communication methodologies that we are experimenting with, both reactive as well as on demand. What we’re seeing in Hawaii is going to be emblematic of what we’re going to have to do not just across the U.S. but across the world.”

Nahi explained how Enphase differs from many other solar companies. “We come from a high-tech background, so our approach to solar has been with that nuance. We believe strongly that for a system to be robust, that it has to have bidirectional communication, so that you can make changes on the fly, that you are not building a static device. Communication is an essential part of any system that you build. In order to do that, you need some very advanced networking technology which we build into our inverter ASIC. Although this concept is very well-known in the telecoms space, it is new to solar.”

“Another way to look at Enphase as a uniquely tech company in solar is our business model,” he continued. “We approach it like we have in our past, which is you focus your opex dollars, your R&D dollars, on creation of intellectual property; you do not build a factory. We use Flextronics, the second-largest contract manufacturer in the world, which gives us tremendous flexibility to ramp up, ramp down, to do whatever we want. At the same time, Enphase owns all quality. We build all the test equipment, we insert the test equipment in the manufacturing line. So we have full oversight over the manufacturing process, the manufacturing test, but we don’t incur any of the overhead.”

Enphase’s Paul Nahi

Quality control has always been important at Enphase, but the company has taken it to another level. “When you’re talking about quality in relatively small volumes, that’s one thing,” Paul pointed out. “But when you’re building millions a year of something, that have to work for 20 years, that are going to be outside, the quality process looks very different. You can’t even begin to evaluate the quality of your system until you have million of units out there for years and collect data from those units and understand what their sensitivities are, how to improve them, what things you need to change.

“A VP of quality reports to me directly as part of the executive team. He comes from the disk-drive industry, which was specifically where we looked, because the drive industry builds tens of millions of units every quarter of a product that is very inexpensive and very high quality. I didn’t want to have to relearn those operational dynamics, so if you look at our quality and manufacturing team, you’ll see a lot of drive experience and a lot of automotive experience.”

“We’re very proud of the quality we have right now, and we continuously get much better with every generation of products because our processes continue to improve and get enhanced,” Paul explained, “as more and more semiconductor development means more and more on-chip and fewer and fewer parts on-board. (Curator’s note: In some ways the company is actually a fabless semiconductor firm, since it has a dedicated chip design team.) We’re learning more and more about how grids operate, so we can be more resilient to grid effects as well. We have units in the South Pole and units in Saudi Arabia, and can understand what the effects are on the units in these different environmental conditions. Because we collect these data from these units, we know what’s happening, and it allows us to strengthen and harden them yet again with each new generation.

“We don’t release product until we have a million-hour testing on any unit that we release. Enphase is testing thousands of units under very harsh conditions. Our quality standards are the most stringent in the entire industry, and it shows in our product. Quality does not start and stop with quality control; quality starts with design, it ends with manufacturing and test. You cannot test quality into a product, you have to understand what it is that makes a product high quality, and that learning is first applied way back in in design.”

Another area where Enphase plays a key role is the convergence of big data and solar power. Although monitoring and managing the data produced by today’s PV systems can be daunting, the real challenge will come when the number of rooftop installations soars from the hundreds of thousands into the tens of millions. “The only way we can scale to 20 million solar roofs in the U.S. is by finding a way to do that in as automated a methodology as possible,” Paul said. “We believe that we have a very scalable way to do that; by collecting data from the inverter, you know the status of each site.

“When you think about how much data that is, it’s huge. Today, we collect north of 150Gbyte of data every day. Sifting through that data and applying the analytics that would allow us to inform the owner or manager of the system of what is an actionable event, whether it’s an issue with the module, an issue with the inverter, an issue with the grid, whether something needs to be cleaned…to be able to get to that level of granularity takes an enormous amount of intelligence in the analytics engine. That is something that takes years to develop.

“The good news is that we are managing this via an analytics engine in a data center, and it scales extremely well,” Paul noted. “We can handle many, many times more data than we handle today, but we have to continuously refine the data analysis and the analytics and come up with more scalable O&M processes that allow us to be able to manage the solar system for the owner, so the owner doesn’t have to worry about it, and then supply whatever resources are necessary just for maintenance.”

[Disclaimer: The Curator has done work for Enphase on behalf of his employer, Impress Labs.]