Evaluation of Alternative Contractor License Requirements for Battery Energy Storage Systems
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Evaluation of Alternative Contractor License Requirements for Battery Energy Storage Systems Final Report for UC Berkeley Contract with the Contractor State License Board for contract CSLB-20-01, entitled “Energy Storage Systems Consultant Services” June 30, 2021 Authors: Carol Zabin, Ph.D. Director, Green Economy Program UC Berkeley Labor Center Betony Jones, Principal, Inclusive Economics Donald S. Holmstrom Retired, U.S. Chemical Safety Board Contents Executive Summary ............................................................................................................................................4 A. Introduction .................................................................................................................................................................................. 4 B. Options under Consideration by the CSLB ....................................................................................................................... 4 C. Research Results .......................................................................................................................................................................... 5 D. Our recommendation .............................................................................................................................................................11 I. Introduction and Background ................................................................................................................. 13 A. Options Under Consideration by the CSLB.....................................................................................................................13 B. What This Report Does ...........................................................................................................................................................15 II. Overview of the BESS Industry and BESS Contractor Licenses in California ..................................... 16 A. What Is a Battery Energy Storage System? .....................................................................................................................16 B. Scope of C-46 and C-10 Contractor Licenses ................................................................................................................16 C. Use of Certified Electricians ..................................................................................................................................................17 III. Profile of BESS Installations and Contractors in California ................................................................. 19 A. Trends in the Size of BESS Installations in California, and Distribution by Sector ...........................................20 B. Who is Installing BESS Paired with Solar in California? ..............................................................................................22 C. Who is Installing BESS Projects in the Residential and Commercial Markets? .................................................26 D. Which Specific Contractors are Installing the Most Residential BESS Projects, by Number of Projects and Capacity? .............................................................................................................................29 E. Does Average Size of Projects Vary by Installer License? ..........................................................................................31 F. Who is Installing BESS Projects in Rural Counties? ......................................................................................................32 G. Summary of Profile of Licenses Held by BESS Contractors ......................................................................................37 IV. Workplace Hazards/Risks and Needed Contractor Demonstrated Knowledge, Skills, and Training ............................................................................................................................................... 38 A. Introduction and Overview of BESS Safety Issues ........................................................................................................38 B. Our Approach .............................................................................................................................................................................39 C. Stakeholder Positions on BESS Hazards, Risk, and Safety Standards ...................................................................40 D. BESS Hazards ..............................................................................................................................................................................42 E. BESS Safety Standards and Guidance ................................................................................................................................55 F. BESS Risks .....................................................................................................................................................................................65 G. CSLB Classifications and Safety Analysis .........................................................................................................................70 H. Is BESS Incidental and Supplemental to Solar PV? ......................................................................................................74 I. Conclusions from Safety Analysis .........................................................................................................................................75 Evaluation of Alternative Contractor License Requirements for Battery Energy Storage Systems 2 Contents V. The Economic Impact of Alternative Licensing Scenarios .................................................................... 76 A. Contractor and Workforce Availability .............................................................................................................................76 B. Cost Differentials between Contractors by License Type ..........................................................................................82 VI. Conclusion .................................................................................................................................................. 95 VII. Appendices ................................................................................................................................................. 97 A. Data Sources and Methodology for Profile of Contractors by Licenses .............................................................97 B. Contractors Installing 15 or More Storage Projects ...................................................................................................98 About the Authors ......................................................................................................................................... 101 Evaluation of Alternative Contractor License Requirements for Battery Energy Storage Systems 3 Executive Summary A. Introduction This report, carried out at the request of the California State Licensing Board, evaluates alternative proposals for the specific contractor license(s) that should be required for battery energy storage systems (BESS), particularly those installed in conjunction with installations of solar photovoltaic (solar PV) systems. The rapid and safe development of the BESS industry—i.e., businesses that design, install, maintain, and repair BESS—is essential for actualizing California’s commitment to achieve 100% carbon-free electricity, as mandated in SB 100 and other laws and orders. Contractor license requirements, including for emerging technologies such as BESS, determine the minimum qualifications that business owners and their workforces must meet to be allowed to install specific technologies; their purpose is to ensure consumer protection, including safety and the general welfare of the public. They are therefore a fundamental component of the California state government’s support for and oversight of the construction industry, including of specialty contractors who install emerging technologies such as BESS. B. Options under Consideration by the CSLB The California State Licensing Board (CSLB) has been addressing contractor classification jurisdictional issues for BESS since 2015. Currently, the C-10 electrical contractors license is required to perform most BESS installations; the exception to this rule is that C-46 solar contractors are permitted to install BESS in conjunction with a solar PV system. Two trade associations have been very active in arguing their positions, with the California Solar and Storage Association (CALSSA) advocating that the C-46 license include BESS under some conditions and the National Electrical Contractors Association and the International Brotherhood of Electrical Workers (NECA-IBEW) advocating to preclude the C-46 license from installing BESS. After extensive stakeholder input and internal research, the CSLB issued an RFP that called for an independent review of the issues, and in the fall of 2020 it awarded UC Berkeley the contract. The independent review we present here analyzes the following question: Should C-46 contractors be permitted to install solar-paired BESS, and if so, under what specific conditions? Specifically, the four alternatives that the CSLB asked us to consider are: Option 1: Preclude the C-46 Solar classification from installing battery energy storage systems. California Code of Regulations Section (CCR) 832.46 currently defines a solar contactor as follows: • A solar contractor installs, modifies, maintains, and