By Tori Richards | Watchdog.org
SOLARCITY RULES: Owner Elon Musk’s car company, Tesla, is located in Palo Alto where the solar bloc dictated building code policy and who gets to inspect its panels.
The solar energy industry, led by billionaire Elon Musk’s SolarCity, has been dictating the building codes of a Silicon Valley city hell-bent on being the greenest city in America, a Watchdog investigation has revealed. This was spurred on by the powerful solar lobby, which threatened to withhold a Green Power Conference award from a top Palo Alto city official unless something drastic was done to change its permit process, according to emails between city officials and the solar industry. During the past six months, the city of Palo Alto has started signing off on solar panel building inspections with lightning speed after removing an electrical expert from those duties and replacing her with an inspector with less expertise, a former employee said. All of this was done to placate the solar energy industry, which complained of cumbersome inspection processes. “Is this dangerous? Absolutely,” said Rick McManus, who worked as a Palo Alto building inspector before resigning in November and going to work for the city of East Palo Alto. “It was such a disaster and they had so many complaints, they pulled in another inspector.” McManus said the complaints came from other building department employees who felt the permits were just pushed through with no thought, and even a few customers who said the critical onsite inspection lasted only a few minutes. Going green — recycling, solar, the whole eco-sensitive agenda — is a kind of civil religion in Palo Alto. Five months ago, the city hired a chief sustainability officer to lead that quest. The City Council has adopted mandatory green building requirements for new homes and businesses regarding energy efficiency, landscaping and materials
usage. And the U.S. Environmental Protection Agency has designated it a Green Power Community, meaning Palo Alto’s publicly owned electric utility emits zero carbon dioxide while some 5,000 homes and businesses here operate 100 percent on solar energy. You would think Palo Alto’s vision of a green utopia meant that every home had a green light to install pricey solar energy systems. In fact, the opposite was true. Disgruntled solar companies were either charging customers inflated rates or refusing to work in Palo Alto altogether, claiming the city’s solar building inspector was impossibly meticulous and created huge delays. “They had overly burdensome and unreasonable plan checks and inspections that were out of keeping with other jurisdictions,” said Mark Byington, founder of Cobalt Power Systems Inc., a leading solar provider in the San Francisco Bay area. “They were known far and wide as the most difficult jurisdiction. We had to charge more to work there.” SolarCity spokesman Jonathan Bass offered this:
GREEN DOMINATION: SolarCity officers Peter Rive, Elon Musk , Lyndon Rive at the New York Stock Exchange in 2012. SolarCity is traded on NASDAQ
“Palo Alto was one of the most difficult solar-permitting environments in the country for many years. The entire local industry has been asking the city for years to reconsider its processes to streamline permitting requirements. Given that the state of California doesn’t even require a permit for an oil derrick, this seems like an extremely reasonable ask. “To the city’s credit, I think they honestly took a hard look at their processes and realized the problem was ‘systemic,’ as they said in a recent article, and was unnecessarily preventing people from going solar, and they decided to make the process more straightforward, to more closely resemble the process in many other cities and towns in California,” Bass said. SolarCity grew to be one of the nation’s largest solar contractors on the basis of an innovative business model — installation of pricey solar systems for little or no money down with a 20-year lease. The company has never earned a profit in its eight-year history, but has kept afloat with approximately $1 billion in state and federal subsidies and tax incentives, SEC filings show. Those subsidies are scheduled to dramatically decrease, and in two years may disappear altogether if a congressional bill is enacted. A Watchdog investigation revealed that SolarCity’s installation process is surrounded by criticism. A top-ranking building official in a neighboring county declared, “SolarCity seems to be the biggest offender” among solar providers. You can fight city hall Situated 35 miles south of San Francisco near the bay, Palo Alto is prime real estate. It has been home for billionaire inventors and entrepreneurs like Steve Jobs, Mark Zuckerberg and Google’s Larry Page. With homes pushing a median of $1 million and family income median at $119,124, Palo Alto is one of the richest cities in America.
It’s easy to see how 5,000 homes and businesses operate 100 percent on solar energy. The transformation of Palo Alto’s building department began at the end of 2012, when Peter Pirnejad was hired to serve as director of Development Services. Pirnejad immediately took on the battle between his building inspection department and the solar-energy businesses that hated it. He created the Solar Photovoltaic Committee to get to the bottom of the complaints. Pirnejad said the committee included “homeowners, PV advocates, and a full range of installers to create online tools, forms, checklists, and flowcharts to help customers through the building permit process.” The committee worked to find ways to shorten the review process, then averaging 122 days. Ultimately, they’d slash the process to five days. The committee included five solar contractors, the advocacy group Clean Coalition, an architect and a nationally renowned solar energy expert. “The stakeholders in this effort took great strides to ensure the process was fair, transparent and code-compliant,” Pirnejad said. “Meanwhile we improved the efficiency of our service-delivery model by posting information on the web and in handouts, as well as having qualified inspectors at hand to assist our applicants.” It appeared Palo Alto’s new process was a success after just a few months. A June 3, 2013, city news release was turned into an article on the consumer site SolarReviews heralding the achievements of the new, streamlined process. “The city has made impressive reforms in expediting … approvals,” Kurt Newick, system designer with Cobalt Power Systems, was quoted as saying. But a month later, the solar energy bloc was upset again, their ire focused on a single building inspector. That inspector, Rhonda Parkhurst, is an electrical engineer widely regarded as among the nation’s best. President of the southwestern section of the International Association of Electrical Inspectors and an instructor with the International Code Council, Parkhurst was meticulous — maybe extremely meticulous — in her job as Palo Alto’s solar building inspector. “Sometimes she can be too picky. Sometimes she can drill it down to the most finite point,” said McManus, the East Palo Alto chief building official. He said he saw this firsthand while working with her as a building inspector in the city of Palo Alto before resigning in November. “Like the height of a disconnect handle is supposed to be 6’7”, and in one case it was an inch too high. In another case, it was not the right attachment screw,” McManus said. “Whether the screw is brass or stainless steel, it still creates the same amount of bonding.” That sort of attention to detail frustrated solar rooftop installers. “First there is the plan check and then there is the inspection,” said Gary Gerber, founder of Sun Light & Power, a Berkeley-based solar provider. “We had to do it two or three times to get it through. We would follow the code and wouldn’t be getting our permits. It makes it impossible to do business.”
The United States has a uniform electrical code that changes every three years as technology evolves. It is partially written by John Wiles, arguably among of the nation’s leading electrical engineers and program manager at the Southwest Technology Development Institute at New Mexico State University. Wiles said Parkhurst likely drew unwanted industry attention because installers have never seen anyone like her. “Rhonda Parkhurst is probably one of the top inspectors in the nation for knowing codes and standards to be enforced,” Wiles said. “When she asks those questions that no one else is asking, it slows things down because those contractors have never had to answer those questions” in other jurisdictions. Wiles, who said he followed the controversy in Palo Alto, said Parkhurst was “trying to protect public safety and contractors hate that. It delays their contract. It delays their installation.” The solar industry has only been around about a decade. Wiles said he is starting to see power failures due to poor installation by contractors who don’t keep up with the codes. “Rhonda holds them to a higher standard so people don’t get shocked, electrocuted or their house doesn’t burn down,” Wiles said. Despite Pirnejad’s best efforts to appease them with a streamlined inspection process, solar rooftop installers remained miffed that Parkhurst remained on the job. She might be there still if not for that award. Palo Alto was on tap to receive the solar industry’s best collaboration award, an honor bestowed upon city officials who work well with industry. Pirnejad was also offered a high-profile gig, heading a panel discussion at the February Green Power Conference in San Diego. Appearing at Green Power would be a marketing score for Pirnejad and the City of the Future, a global clearinghouse for green market intelligence and training organization with 27,500 members in 161 countries. Pirnejad attempted to plan the panel discussion with an email chain that included the solar industry lobby and contractors such as SolarCity. Then trouble emerged. David Coale, a board member at the Palo Alto-based healthy planet group Acterra, was first to lower the boom. “I would not want the (Palo Alto inspection) process to be upheld for others to see as a standard to be aimed for,” Coale wrote in a July 15, 2013, email. “At this time the Palo Alto PV process is not yet an award-winning process for others to follow.” Bruce Gordon, owner of contractor Horizon Solar Power, chimed in with all caps, saying Parkhurst “is still on the same program . . . . She is still using the PALO ALTO CHECKLIST, which DOES NOT exist in any other jurisdiction.” Next, SolarCity operations manager Gregory Starke blasted Palo Alto’s efforts with a lengthy follow-up email. “We let Peter know that things were not changing in the trenches about one and a half months ago,” he wrote. “We have pretty much given up here at SolarCity and will just continue to charge more for now, however there is discussion about pulling out of Palo Alto entirely. We all know that one person is the main problem . . . . “We all want quality and a safe installation … any and every detail that can be found will result in comments for rejection no matter how minor … It is smoke and mirrors to give the illusion of progress,” Starke said. One of the groups included in the email discussion was Vote Solar, a nonprofit dedicated to bringing solar energy into the mainstream by lobbying efforts. Its yearly fundraiser in February featured California Gov. Jerry Brown, a huge supporter of green energy. A few months after receiving the emails, Pirnejad removed Parkhurst from her duties involving solar installations. These days, plan checks are signed off immediately at a walk-in counter, McManus said, and site inspections are rushed through. Pirnejad characterized the changes as business efficiencies. An inspector with less experience was handling the workload, but two months later another inspector with 20 years of experience was hired to handle the solar projects. When asked why he had to hire someone else when he had an expert in house, Pirnejad said, “I cannot comment on specific personnel.” The past six months have been happy times for the solar industry, as Palo Alto has been rapidly approving solar installations given that Parkhurst was reassigned. But one veteran building inspector who asked not to be named said painstaking reviews protect the consumer from fire hazards and electrocution. “You have a huge amount of electricity flowing unchecked across a roof,” the inspector said. “If it’s not done correctly it could burn your house down. And I’ve seen a house with bad wiring where the entire roof became electrically charged during a rainstorm and could’ve electrocuted someone.” Apparently the solar lobby was placated. When Feb. 4-5 rolled around this year, Pirnejad traveled to San Diego to pick up his award on behalf of Palo Alto. Only one industry provider contributed to the city news release trumpeting Palo Alto’s 2014 Best Solar Collaboration Award at the Annual Solar Power Generation USA Congress in San Diego: SolarCity. “The City of Palo Alto deserves a tremendous amount of credit for listening to the needs of solar customers and making direct changes based on those needs,” said Jefferson Silver, senior commercial project manager for SolarCity. “Palo Alto has made the most dramatic improvements to its permitting process of any of the jurisdictions we work in.” Contact Tori Richards at email@example.com and on twitter @newswriter2.