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Operations, maintenance and decommissioning: what municipalities should budget for solar projects
Summary
Power Options advised municipal energy managers on O&M responsibilities, recommended reserves, monitoring options, common capital replacements (inverters ~year 12), and decommissioning steps and costs (about $0.30 per watt); PPAs typically include decommissioning while direct ownership does not.
Farrah Gillette, an analyst at Power Options, told attendees that municipalities must plan both predictable annual O&M and an unpredictable corrective reserve when they own solar systems. She said preventative maintenance (usually under an annual O&M contract) provides production monitoring, incentive and net‑metering support, an annual onsite preventative visit, and warranty claims handling. Corrective maintenance covers unplanned repairs — inverter failures, panel damage or storm restoration — and is typically billed time and materials.
Gillette recommended budgeting a minimum reserve of roughly $3,000 per year (presented as a rule of thumb of about $15–$45 per kilowatt per year, depending on system size and complexity). She said inverters are likely to require replacement around year 12 and gave ballpark replacement labor and material ranges by system size. "If the system is already in multiple years of operation and you haven't started accounting for these costs, you may want to accelerate those deposits," she said, urging municipalities to treat reserves like a roof‑replacement fund.
On monitoring, Gillette described two complementary approaches: the inverter‑manufacturer monitoring platform for raw, real‑time data and panel‑level visibility, and O&M provider portals or monthly reports that add trend analysis, service histories and actionable recommendations. She recommended using both where possible so manufacturers’ raw data feed into O&M analysis.
In a registration question about decommissioning, Gillette outlined the standard process: site assessment, electrical shutdown, panel and infrastructure removal, site restoration, and recycling/disposal of materials. She estimated decommissioning costs typically around $0.30 per watt and said decommissioning is covered under typical PPAs; owners that directly own systems must plan and budget for it. Gillette also noted options at end of term in PPAs: extend the PPA, purchase the system at a net present value at preset points (year 7, 10, 15 or end of term), or opt for decommissioning.
For municipalities weighing PPA versus direct ownership, Gillette summarized the tradeoffs: PPAs reduce capital and maintenance duties for the municipality but lower long‑term financial upside; direct ownership offers greater financial benefit but transfers O&M, administrative and incentive risks to the host.
