Sustainable Energy Technologies inverts the solar market

An Alberta firm finds success from a reluctant home market

March 01, 2011

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Michael Carten
Sun King: Sustainable Energy Technologies chief executive Michael Carten thinks the future of solar power lies with inverters
Photography by Jason Molyneaux

Michael Carten knows the challenges of running a renewable energy business in Alberta. When the accidental entrepreneur makes his sales pitch for the future of solar power in a province more accustomed to drill bits and derricks, he frequently gets what he calls the “usual dinosaur reaction.”

But the chief executive of Sustainable Energy Technologies (SET), a Calgary-based company that produces inverters for solar panels, is not deterred. “There’s the potential here to build a company that is Canadian-based and that is actually a competitive player in the renewable energy and alternative energy industry,” he says.

A former senior partner with a leading energy law firm, Carten says he “kind of backed into” the entrepreneur role when he joined a group of investors launching SET in 1999. He has spent the last decade building an international company from a reluctant home market. “In the big picture sense, we’ve actually been creating a company off what amounts to a drawing on a piece of paper when we started,” he says.

Since its early days of dabbling in wind power and fuel cell applications, SET has refined its focus to grid-tied solar power. The company’s main offering is the Sunergy inverter, a device that enables photovoltaic solar panels to be wired in parallel instead of in a series, boosting performance and improving safety. Carten compares the series model to lights on a Christmas tree. If one light goes out, all the lights go out. “If you were to wire those Christmas tree lights in parallel, one of them would go out, but the rest would continue to operate. When it comes to solar panels, it’s the same thing.”

When solar panels are wired in series and one panel operates at half-power, the whole system operates at half-power. By using an inverter, panels can be wired in parallel. The result is that each panel operates independently of the other panels in the system, so even if one panel is operating at half-power, the other panels can continue to operate at their normal output.

The difference plays an important role in harnessing the power of the sun. Shade is a perennial problem for solar-panel setups. An entire system can lose a significant amount of energy when one panel is blocked by dust or sunlight is otherwise obscured. By connecting solar panels in parallel, energy losses no longer affect the entire system. “The parallel solar model is all about saying, ‘Why don’t we look at the whole system operating as an integral unit and see if we can get better economics based on how we put the system together,’” Carten says.

His firm’s stock-in-trade can boost power output by five to 25 per cent. The parallel arrangement also allows solar schemes to operate below 120 volts, which reduces the shock for anyone who might come in contact with a system’s wiring. Parallel solar provides a better “fill factor,” essentially enabling more panels to fit in a given space.

Michael Carten 2
Michael Carten’s Calgary-based firm is increasingly making calls to Ontario to market its product
Photography by Jason Molyneaux

The inverter technology was developed locally at SET’s head office in Calgary. But Carten is unsure his firm will continue to call Alberta home. “The markets aren’t here,” he says.

The solar specialist is focusing increasingly on Ontario’s solar industry, where demand for its devices is driven by the province’s feed-in tariff, which provides a guaranteed pricing structure for renewable electricity production. SET’s inverters were recently selected to power Ontario’s largest solar tracker project. “The market for our product is Ontario; that’s where we’re putting most of our time today, then Europe and then the United States,” Carten says. Sales offices in Toronto and in Athens, Greece, serve SET’s global customers.

The Alberta market is small, Carten says. Although the province is blessed with Canada’s strongest levels of solar irradiation – a key factor in making the alternative power setups worthwhile – the entrepreneur isn’t convinced his technology has a future in Wild Rose Country. Policies that support renewable power schemes are virtually non-existent, while a vast supply of cheap and accessible coal-fired generation makes it tough for solar energy to compete.

Still, he’s committed to the budding sector. “I really believe profoundly that we as Canadians have to create our own technology and create our own products and export them,” he says. “We should play a role in what are going to be the new industries in the next 100 years and this is one of them.”

Regardless of the reception to the inverter technology in Alberta, SET’s future in other markets looks bright. Using numbers pulled from industry forecasts, the company believes the value of its niche market will grow globally from $1.3 billion in 2007 to $5.3 billion in 2012.

The shift from series to parallel solar technology is the most disruptive change happening in the industry right now, Carten believes. Add to that the reduced cost of solar energy – driven chiefly by a combination of favorable subsidies in Ontario and B.C. as well as the improving supply-chain and procurement practices of a maturing sector – and SET’s fortunes are indeed looking bright. “I can see this company as having hundreds of millions of dollars in revenues,” Carten says. “It looks hard to get there from here, but I think the potential is there.”

Recent developments in renewable energy technologies are particularly exciting for Carten. Parallel technology is becoming an industry standard. Few were interested in the novel setup on a recent trip to Europe a year ago, Carten recalls. “Now it’s the buzz in the industry and people are saying, ‘Come on in, I want to talk,’” he says. “And it’s gradually going to get more traction and I think it will become the way in which systems are put together. It’s a classically disruptive technology, and it’s going to change the landscape. It’s going to change who the incumbents are.”

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