U.S. Department of Energy - Energy Efficiency and Renewable Energy

Solar Energy Technologies Program

Implementing a Systems-Driven Approach

Doing business wisely and thinking strategically is key to accomplishing the Solar Program's mission of bringing reliable and affordable solar energy technologies to the marketplace. To better understand, guide, and assess its activities, the Program is implementing a "systems-driven" approach. This approach emphasizes the importance of how the myriad aspects of a technology-materials and processes, components, subsystems, systems, applications, and markets-are related to each other.

Using this systems-driven approach, we might consider how changes in a component-for example, low-cost polymer frames for solar water heaters-might affect an application or market. Or we might examine how changes in a market modify the requirements for component cost and performance, such as the impact that interconnection standards may have on the design of power inverters.

By developing this capability for all solar technologies in the Solar Program, we can:

• Determine priorities within the program
• Identify key market sectors in which solar technologies can have significant impacts
• Determine critical R&D to address technology barriers related to those markets
• Develop a standardized means of analysis to ensure that technologies meet targets related to cost, performance, and reliability.

Understanding the Big Picture

The systems-driven approach emphasizes the importance of how the myriad aspects of a technology are related to each other.

This broad perspective on solar energy R&D is part of a renewed emphasis on understanding the challenges facing solar energy and identifying the most important research required to create effective solar systems.

At the program level, a systems-driven approach helps identify common elements that impact R&D. For example, all solar technologies targeting central-station generation for firm power share similar assumptions about the value of dispatchability and the cost of competition in different regions. Applications integrated into building roofs or installed on roofs have common challenges in satisfying builder and owner preferences and in interconnecting with the utility system if they generate electricity in grid-connected systems.

At the technology level, a systems-driven approach can help identify common research concerns, avoid duplication of effort, and explore how advances in an area such as subsystems might change the assumptions or requirements for systems, applications, and markets.

When the systems-driven approach was presented to representatives of the U.S. solar industry, they responded enthusiastically. They've been using a market-based approach for years in their own businesses, so it was a natural fit. One example of this is a PV rooftop system owned by RealEnergy Corp. of California. After doing market research, company leaders were convinced there would be an exploding market for on-site power generation among U.S. commercial property owners. RealEnergy is marketing its distributed generation systems as a supplemental energy source for building owners whose tenants-many in the high-tech sector-depend on a steady supply of reliable power. Building owners would not incur any up-front costs, and would generally contract with RealEnergy for the on-site power for a period of 15 years.

Arden Realty of Fountain Valley, California, uses this 240-kilowatt rooftop PV system for its company headquarters. RealEnergy Corp. is marketing such systems based on the market-driven economics of commercial firms needing a steady supply of reliable power.

The Systems-Driven Approach in Action

Within the Solar Energy Technologies Program, the systems-driven approach will be used to:

• Align technology development efforts and objectives with market-specific requirements (such as requirements for grid-connected, residential/commercial, and remote applications).

• Apply a consistent methodology in developing and using analytical tools to analyze the impact of R&D activities (improvements in cost, performance, and reliability) and non-R&D activities (learning curve, economies of scale, financing, policy) on the costs and impacts of program technologies.

• Develop and document a consistent methodology for continuously updating information on the cost, performance, and reliability of technologies under development and fielded through the Solar Program.

• Assess the relative probabilities of success among different technology R&D options, allowing informed decision-making at all levels.

The Value of a Systems-Driven Approach

A systems-driven approach, if applied correctly, offers clear advantages once market requirements are defined and understood.

• By defining a clear set of market-based requirements and related system- and component-level technical targets, a systems-driven approach will allow project managers to more efficiently allocate limited resources to R&D efforts that yield the greatest impact on system cost and performance.

• A successful systems-driven program will provide researchers with tools to gain a much clearer understanding of the impacts of their specific R&D options on overall system cost and performance.

• Data generated from a well-managed systems-driven approach will provide the Solar Energy Technologies Program with a more credible and defensible story regarding the impact of R&D efforts on DOE and national goals.

Within the Solar Energy Technologies Program, the systems-driven approach will be used to do the following:

• Align technology development efforts and objectives with market-specific requirements (e.g., requirements for grid-connected distributed, grid-connect utility-scale, residential/commercial, and remote applications).

• Apply a consistent methodology in developing and using analytical tools to analyze the impact of R&D activities (improvements in cost, performance, and reliability) and non-R&D activities (learning curve, economies of scale, financing, policy) on the costs and impacts of Program technologies.

• Develop and document a consistent methodology for continuously updating information on the cost, performance, and reliability of technologies under development and fielded through the Solar Program.

• Assess the relative probabilities of success among different technology R&D options, allowing informed decision-making at all levels.