Why (not?) solar panels on parking lots
Where solar canopies on parking lots make sense
Parking lots look like great places to put solar panels. It is a complementary land use that provides shelter to those who park their cars while generating power for a future dominated by electric vehicles. The cost-benefit analysis is complicated by the cost of digging up asphalt, ensuring canopy height is high enough, and shared ownership models. As the saying goes, “hope is not a strategy,” and wishcasting a future with panels on top of every strip mall parking lot is a failing strategy. That said, some compelling reasons exist to build these canopies in the right situations. Let’s dig in.
The missing scale factor
I have been a fan of putting solar panels on parking lots. I live in the South where it’s not unusual to be caught in a deluge of rain or sweltering heat walking into the grocery store. However, my personal experience as a consumer isn’t enough to make this happen because it is abnormal that a suburbanite would be expected to pay for parking. Outside of charging patrons for the privilege to park in a solar panel roofed area, there’s no good way to monetize the panels. That leaves lot owners with only the standard solar payback methodology where they will hopefully generate enough electricity to both cover the installed cost and turn a profit before the panels must be replaced.
Solar canopies cost around $4-5 per watt, about twice what a standard rooftop installation costs. This is because they must rip up the parking lot to bury lines and install the support structure on which to install the panels. Lost spaces are typically not that big of an issue for consumers, but minimum parking requirements still must be met, so some lots would have to find additional spaces somewhere as support posts will end up occupying several spots throughout the lot. Businesses will want to ensure their signage is still visible but the canopy must still be high enough to accommodate large delivery vehicles.
Even if we were to subsidize this installation method to address profitability issues, there just isn’t enough land covered by parking lots in the extremely car-friendly US to make a dent in energy demand. Even though lots are closer to where demand is, rooftops are far cheaper to add solar to and require fewer permitting complications. Where there is available transmission, agrovoltaics are even better because so much land is used for livestock grazing, and panel installation costs about 25% of installing a solar canopy.
If 10% of non-forested pastures in the US had solar panels installed on them, we’d have 65 million acres of private land naturally maintained by livestock helping farmers turn a profit. The Department of Energy estimates we’d need about 5.7 million acres to reach 40% of total US energy consumption covered by solar power. This scale isn’t possible with parking lot solar panels.
Bad for profits, good for business
Disneyland Paris has a gigantic solar canopy covering its parking lot that covers 11,200 parking spaces and generates around 36 GWh per year. I know this because it’s everywhere on their website and has been for more than three years. Disney is ensuring park patrons know that it is committed to 2030 environmental goals that include sourcing 100% of the company’s electricity from carbon-free sources. This is an invisible change to Disney customers, so the best way to ensure they get credit is to do something grand. Disney makes a living on brand and grand events, so other companies should pay attention. Paying for a premium solar installation that consumers can feel the benefits of, is a marketing expense. However, it only works with companies like Disney or Apple who have deep pockets and a hardcore brand following.
For companies that are not beneficiaries of enormous marketing budgets, the calculation is a bit different. RTI International is a non-profit in North Carolina’s Research Triangle Park that uses scientific research to support causes in many areas including improving the environment, genetics, and agriculture. They are known as a highly ethical research institute that gets much of its funding from the government. They also recently made the choice to install solar panels on top of a parking garage.
Sustainability Manager at RTI, John Nichols, told me on a tour of the campus that the bifacial panels on top of a parking structure ran about $5/watt versus the around $1/watt it would cost to put them out in a field or just under $2/watt for a rooftop (RTI is also doing this elsewhere on campus). That’s expensive! The project itself cost around $1.3M, $700k of which will not be recovered over the lifetime of the panels. He helped push the project forward anyway and I found out a reason for spending the extra cash was about leading. Solar panels off in a field in a far-flung corner of campus are not visible to employees or visitors. Now employees drive to the previously abandoned top floor of the parking deck to walk under the Tron-like lighting that filters through the panels and get a sense of pride that the values set forth by the company leadership come to life here. Even if the heavy lifting of clean power generation is done elsewhere, this token gesture makes it feel true.
Making employees feel the company has its money where its mouth is has an intrinsic benefit, but for a nonprofit, the impact on visitors is also paramount. RTI is a local leader in the Research Triangle Park and now it has a clean energy beacon that can show visiting leaders from Netapp, IBM, Cisco, and others giving them a clear picture of progress. This also paves the way for businesses to band together and put further pressure on the local utility, Duke Energy, to clean up the grid or begin losing significant business as the companies in the area choose to invest in generating their own power using the plentiful land on their sprawling corporate campuses.
Finally, for the folks who drive to work every day but live somewhere, like an apartment, that makes charging an EV difficult, RTI now has an opportunity to expand their number of charging stations in a way that is well aligned with when their solar generates power. Workplace charging is one of the best examples of a grid-positive electricity load shift from night to day and can prevent the need to build additional transmission by locally consuming solar. That sort of leadership is a differentiating benefit to the type of population attracted to working at a science-based nonprofit organization, and I believe RTI is targeting a future recruiting benefit here. Leaders will tell you that hiring is the hardest part of building a company. An extra $700k that can attract more talent is a great investment.
In the end, it’s not likely we’ll see solar panel canopies popping up on strip mall parking lots. I do expect to see more marketing spend on showy solar panel installations for companies who want to build a greener brand. It’s hard to show off the rooftops and fields with solar panels doing the bulk of the effort. A complementary, if expensive, highly visible installation enables a company to get brand credit where it is due.
I get that retrofit costs are high, but what would the incremental cost be for a newly built parking lot?
Would it also help to incorporate the power with on site EV charging?