Toyota Production System (TPS) & $1/Watt PV System Challenge

$1/Watt PV System – BoS /Installation Challenges for Ground Mounted Systems

The $1/watt White Paper from the U.S. Department of Energy was a great start to kickoff discussions and movements towards the goal of making solar power competitive without any incentives. To achieve this goal, the cost of an installed PV system would break down into the following components:

•    $.50/watt for Modules

•    $.40/watt for BoS/Installation

•    $.10/watt for Power Electronics

Module Prices and Power Electronics are Getting There

With new production capacities going online almost every week and new players consistently entering the global market, it seems that the question is not if, but when the module prices will hit the $.50/watt. Innovation, scale of production and fierce competition will lead the way to the defined goal, not only for the modules, but also for power electronics.


Currently, physical system costs, including labor, are accounting for about 75% of BoS costs for a ground-mounted installation. These costs are divided between structural components and the electrical system.

How can these costs be driven down to the $.40/watt goal? A 2010 Rocky Mountain Institute (RMI) workshop suggested the following steps:

•    Reduce forces at work – such as reduction of the wind load

•    Optimize structural form and materials

•    Design for low-cost installation

What does Toyota Production System (TPS) have to do with this challenge?

Back in the 80’s, people in the U.S. were trying to understand the success behind the Japanese car manufacturer leading to a study conducted by MIT and the bestselling book “The Machine That Changed the World.” A key finding of the study showed that Toyota was continually identifying and eliminating waste from their system.

Today’s process for large scale solar projects still lacks the integration necessary to reduce muda (Japanese for waste). A typical example of lost efficiency, after the MIT study was completed, was the integration of design, production, marketing and O&M by team members and/or vendors to develop the best possible solution for a new car design, always striving to improve the result (Kaizen).

Our experience within the market today clearly shows that investors, project developers, system designers, component suppliers and installers are still not collaborating in a way necessary to reach the proposed targets. A typical example is the design and procurement process of racking solutions for ground mounted projects – instead of bringing racking manufacturers, geo-tech engineers and installers together to work on the most cost- and time efficient solution, developers and EPC’s are working sequentially. They first analyze the soil conditions without trying to optimize the foundation, then choose the racking and finally find an installer. This work flow does not unleash the full potential of cost savings by integration and will not sustain in a market under pressure. Racking manufacturers like Schletter, Haticon, Mountings Systems and Sunlink are moving in the direction to integrate their approach and offer the full spectrum. Others like Aquasoli, a leading geo-tech engineering company and Sunstall offer an integrated approach to increase the overall efficiency of the projects.

Alea iacta est – The die has been cast

The integrated approach to really cut costs dramatically has only been adopted by a few leaders in the market. Overall the PV industry still has to mature and learn from other industries, (like the highly automated agriculture equipment, which revolutionized harvesting of crops) to challenge themselves with every project and every installation to reach grid parity. The sooner we begin to collaborate in a functional manner, the sooner the industry can begin to spread low-cost solar power throughout the nation. We have many challenges ahead of us and only one thing is guaranteed: fossil fuel depletion.

Helge Biernath is the President & CEO of Sunstall, an installation company in California with the main focus on large solar projects. His company consults clients to find optimized racking and foundation solutions.

Have any Question or Comment?

One comment on “Toyota Production System (TPS) & $1/Watt PV System Challenge

Terry Dvorak

I whole heartedly agree that the dramatic improvements will come only once open collaboration between all stages of the supply chain as well as engineering and installation crews work together to drive the “muda” out and focus on the end goal: final installed cost versus just the cost/profitability of their respective portion.

I’ve seen strides made over the past 3 years with this mentality.

Comments are closed for this post !!
Skip to toolbar