Actual scenarios can be much more complex than that, but many of the problems mentioned above are common. Although projects are capable of producing more, it is often difficult to fully exploit their potential, as incentives are often misdirected despite the best efforts. Proponents of demanding projects must have a way of thinking that prevention is preferable to healing and should keep in mind the incentives of the various participants. It is naïve to expect everyone to deviate to optimize the performance of the installation if all that is expected is to reach a minimum threshold (i.e. the guarantee of performance). Observing the different phases of a project allows us to see how the performance guarantee agreement effectively prevents participants from taking appropriate steps to achieve optimal facility performance. Below we look at the design, design and operation phases of a simplified scenario in which an LLC owner wants to build a PV project. Even if everything works as planned, it will be necessary to prove and validate that the system is working as intended. Owner LLC also employs a separate operations and maintenance team (O-M) and has various key performance indicators (KPIs) that measure success. In the event of performance issues, EPC Inc. must work with OEMs and Owner LLC`s O-M team to resolve the issues. This work must be done in time to complete EPC Inc`s performance guarantee, but EPC Inc.
does not have control over all aspects of the process. This is a potential risk for EPC Inc, and they are repairing it by asking Owner LLC to reduce the performance guarantee threshold from 97% to 95%. At the end of the design phase of this scenario, Owner LLC embarked on a project with a performance guarantee, but at best low. In this case, EPC Inc. is cautious in proactively solving problems, as they are concerned about respecting their performance guarantee. The process of identifying the cause of the problems and working with device manufacturers to resolve them takes time. However, at the end of the average performance period, they realize that they are comfortably fulfilling the warranty and becoming less proactive in solving future problems. The power guarantee requires a calculation of the expected power using measured weather data, such as irradiation and temperature.