Amazon took solar rooftops offline last year after fires and explosions

Amazon shut down solar power systems at all of its US facilities in 2021 after a series of fires and explosions, including one at its Fresno warehouse in 2020.

Fresno Fire Department

On the afternoon of April 14, 2020, dozens of firefighters arrived at an Amazon warehouse in Fresno, California, as thick plumes of smoke poured from the roof of the 880,000 square foot warehouse. .

Some 220 solar panels and other equipment at the facility, known as FAT1, were damaged in the three-alarm fire, which was caused by “an undetermined electrical event in the rooftop-mounted solar system”, Leland Wilding, the Fresno fire investigator, wrote in an incident report.

Just over a year later, about 60 firefighters were called to an even larger Amazon facility in Perryville, Maryland, to put out a two-alarm blaze, local media reported.

In the months that followed, at least four more Amazon fulfillment centers caught fire or suffered electrical explosions due to outages in their solar power generation systems, according to internal company documents seen by CNBC.

The documents, which have never been made public, say that between April 2020 and June 2021, Amazon experienced “critical fires or arc flashes” at at least six of its 47 North American locations with solar installations, affecting 12.7% of these installations. Electric arcs are a kind of electrical explosion.

“The dangerous incident rate is unacceptable and above industry averages,” an Amazon employee wrote in one of the internal reports.

The solar snafus underscores the challenge that Amazon and many other large companies face in their quest to reduce their environmental footprint and lessen their dependence on fossil fuels. Amazon has been among the most aggressive. In 2019, founder Jeff Bezos launched the Climate Pledge, promising that the largest online retailer would eliminate emissions by 2040, embrace renewable energy and move away from gas-guzzling delivery vans, including through an investment of more of a billion dollars in the electric vehicle company Rivian. .

Amazon’s learning curve with solar

US companies are under pressure from regulators and a growing subset of investors to set and report on environmental, social and governance (ESG) goals.

Many will be able to reap financial rewards for renewable energy efforts after Congress passed the Cut Inflation Act in August, which includes climate provisions that are expected to cut the country’s carbon emissions by about 40% by 2030.

Commercial solar power in the United States is expected to grow 8% annually over the next five years, thanks in part to legislation, according to Wood Mackenzie solar analyst Michelle Davis. Warehouses can take advantage of solar power, she said, because they have large roofs and the systems can power all the HVAC, refrigeration and other large energy consumers inside.

But costly and dangerous problems can arise.

Solar power systems on the roof of Amazon’s Fresno warehouse sparked a three-alarm fire in 2020.

Fresno Fire Department

In June last year, all of Amazon’s U.S. operations with solar power had to be temporarily taken offline, according to internal documents. The company needed to ensure that its systems were designed, installed and maintained correctly before “reactivating” any of them.

Amazon spokeswoman Erika Howard told CNBC in a statement that the incidents involved partner-operated systems and that the company responded by voluntarily turning off its solar-powered rooftops.

“Out of an abundance of caution, following a small number of isolated incidents with on-site solar systems owned and operated by third parties, Amazon has proactively shut down our on-site solar installations in North America and taken immediate action. to re-inspect each installation by a leading company of solar technical experts,” the statement read.

These details did not appear in Amazon’s 100-page sustainability report for 2021, which was released in early August. In the report, publicly available via Amazon’s sustainability website, the company said rooftop solar was powering 115 of its fulfillment centers worldwide by the end of 2021, compared to over 90 by mid-year. The majority of them are outside the United States

“Many of our order fulfillment facilities in the US, Europe and India are powered by on-site solar energy, where a rooftop installation can power up to 80% of the plant’s energy consumption. ‘installation,’ the report says.

As of April this year, Amazon had on-site solar power at 176 facilities, according to its website. The solar program was launched in 2017.

“As the inspections are completed, our on-site solar systems are being powered back up,” Howard said. “Amazon has also assembled a team of dedicated solar experts overseeing the construction, operation and maintenance of our systems internally to ensure the safety of our systems.”

Any mention of expenses incurred by Amazon in the event of default is excluded from the public sustainability report. One Amazon employee estimated, in internally released documents, that each incident cost the company an average of $2.7 million. Costs included third-party audits of the rooftop solar systems, verification of how much electricity they produced, and repairs for any broken or faulty parts of the systems identified by inspectors.

The Amazon employee also said the company would lose $940,000 a month, or $20,000 for each of the 47 North American sites downgraded, as long as solar power remained offline. There could be additional costs for Amazon depending on contracts with clean energy partners for renewable energy credits, according to the documents.

To date, Amazon has contracted with third-party vendors to design and then install rooftop solar PV systems and large onsite battery backups. other great retailers, including Walmart and Target, have also installed solar roofs and adopted programs to lower their energy bills and meet sustainability goals.

In addition to its warehouses, Amazon has solar rooftop systems in its Whole Foods stores. Amazon and its auditor, Clean Energy Associates (CEA), have postponed inspections of rooftop solar systems at Whole Foods sites until 2022, the documents show. At the end of 2021, four years after the acquisition of Whole Foods, Amazon was still working to obtain technical information on renewable energy assets in stores.

Solar panels are installed on the roof of a Walmart store in California.

walmart

To maintain tighter quality control of its solar power systems, some Amazon employees have recommended integrating more operations in-house. The Perryville, Maryland fire, which was the sixth failure in just over a year, prompted the company to take systematic action.

On June 17, 2021, about a week after the warehouse fire known as MDT2, Amazon’s sustainability division ordered owners and developers of rooftop solar systems in its US warehouses to put them on. out of order. Solar rooftops would no longer generate electricity from the sun or produce renewable energy credits.

Amazon then engaged the Denver-based CEA to perform a third-party audit of its rooftop solar systems in the United States, Asia-Pacific and Europe, the Middle East and Africa.

Late last year, while the CEA was still conducting its inspections, it notified Amazon of one critical finding and 259 major findings in Amazon’s rooftop solar portfolio. The issues included incompatible module-to-module connectors, improper installation of connectors, poor cable management and evidence of water intrusion into the inverters, according to internal documents.

Problems with inverters, which convert solar power into usable electricity, have been identified as the likely cause of a fire in at least one Amazon warehouse. Wilding, the Fresno fire inspector, concluded that the FAT1 fire “originated on or near two inverters,” according to an investigative report obtained by CNBC via a public records request.

Malfunctions and incorrect installations

Amazon blamed third-party partners and vendors for the most significant issues uncovered by CEA and other teams working on facilities and sustainability initiatives.

“Over the past five years, solar malfunctions have been caused by improper installation techniques, improper commissioning of a new system, improper system maintenance and equipment malfunction,” the documents say. .

Amazon teams working on facilities and sustainability initiatives have devised a two-part plan to help prevent future outages in the rooftop solar program.

In late 2021, the divisions requested $3.6 million in funding to re-inspect sites where major finds were identified to ensure systems could be safely brought back online, according to internal correspondence.

Internal teams have also begun to urge Amazon management to rely more on salaried employees and less on external vendors. Over time, the company has hired more solar experts specializing in sourcing, designing, building and maintaining globally.

In some cases, management has been particularly slow to respond. For example, groups inside the company advocating for change went to management to approval of hiring, re-inspection and re-invigoration plans. But efforts have been delayed for months by top Amazon executives, including Kara Hurst, vice president of global sustainability, and Alicia Boler-Davis, senior vice president of global customer satisfaction, who left the company. company in June 2022, according to internal correspondence consulted. by CNBC.

The job postings suggest that Amazon is still looking to hire people internally for solar operations.

The company was recently looking for someone to manage sustainability projects at its North American facilities, which include rooftop solar. There is a current roster of a technical program partner on the solar team which indicates that a key aspect of the position is working with “internal partners” in global design, solar construction and sustainability, among others divisions.

As it tries to recruit staff, Amazon acknowledged that going green comes with hurdles, especially for a company “of the size and vast reach of Amazon.”

“But at Amazon, we’re not shy about taking on big challenges,” Hurst wrote in the launch letter for the 2021 Sustainability Report. “We don’t have all the answers today, but we believe in the need to act now.”

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