Our Director of Product, James Pagonis, once joked in a meeting that “80% of solar companies are in technical default, and they don’t even know it”. And it got us thinking about all the myriad compliance requirements that come with proper asset management in renewables. Our software, PowerHub Lithium, was born out of our founders’ experience consulting with wind and solar energy companies navigating regional compliance requirements. We feel your pain.
I can practically feel your eyes glazing over as I write, but this is important. It can sink your business. Do you even know what all of your regulatory and contractually mandated requirements are? If not, do you know where to find the information? If I were to call you up in five minutes and ask you to list them all off, could you do it, or would you need days or weeks to puzzle it all out?
Compliance is boring. It feels like a necessary evil. So let’s talk about how you can stay ahead of the curve without losing your mind in the details.
Your business is built on 3 pillars: compliance, technical performance, and financial performance. So much time and effort is put into technical and financial performance optimization, so how do you ensure that compliance follows suit?
You’re thinking I’m about to tell you what your requirements are, and that you should know them by heart, but I’m not. The truth is, I don’t know your business better than you. I haven’t seen your contracts, and I don’t know where you operate, and these things matter. I think knowing the details is overrated, and that more often than not, you just need to know how to find them quickly, and to trust that you’re using the right tools to automate as much of the process as you can.
Centralize Document Storage
Chances are, you won’t hold on to your renewable assets forever, you’ll get to the point in your project’s lifecycle where you need to sell, and due diligence requirements are no joke. Instead of relying on Microsoft Office Suite, leaving one team member with the “keys to the castle” as far as your legal documents go, get transparent and centralize document storage. You may be tempted to go to Dropbox, but this isn’t secure. There’s no dual authentication, and since it can be downloaded and shared, you lose control over access. You also lose version control.
You’ll need to disclose your obligations come time for due diligence and support them with the right documentation, and you can’t very well do that if: 1) Only one person knows where the file is stored and controls access to it, 2) you can’t guarantee that it hasn’t been securely stored and maintained, and 3) your version control has gone out the window.
Create a Better Compliance History
If you’ve been in renewables for any length of time, you’ve probably dealt with stakeholder activism in one form or another. You need to protect yourself and your business by ensuring that you handle these situations in the best way possible, with clarity in your communications, and complete transparency in your actions. Meaning, you need tools to track the steps you take to work through these issues.
You know you need records. You probably track your project data, yourPPAs, your invoices, your stakeholder engagements. Take a little bit of that project management expertise, and apply it to your regulatory and contractual obligations.
Track and Schedule your compliance obligations
Part of good compliance is simple, consistent task and project management. This you can automate. Do your self a favour and build yourself a master schedule with all your recurring obligations, set up tasks, and get your team involved. Part of staying on track is simply keeping everyone on the same page.
The Nice to Haves
You’re lucky. You’re in business in an industry widely considered to be working to make the world a better place, and you probably have some good will in your back pocket from that alone.
As the industry moves from focusing on tangibles towards intangibles,good corporate citizenship is paramount. The progress you make ensuring you stay in compliance with your contractual demands moves the needle for your brand. You may not be explicitly named as a bad actor, but push the limits of your obligations, pay late, shirk your responsibilities, and word gets out. Being unprepared means exposing your business to risk, and potentially, big fines.
If you want a bit of a deeper dive into what NERC CIP requirements apply, check out our article “3 Things to Consider When Setting up NERC CIP Compliance” or visit NERC’s main site. If it’s FERC that’s giving you trouble, here’s a bit more information.