Amazon shut down solar power systems at all of its US facilities in 2021 after a series of fires and explosions, including one at a Fresno warehouse in 2020.
Fresno Fire Department
At noon on April 14, 2020, dozens of firefighters arrived at Amazon Warehouse in Fresno, California, as thick plumes of smoke billowed from the roof of an 880,000-square-foot warehouse.
About 220 solar panels and other equipment at the facility, known as FAT1, were damaged by the three-alarm fire, which was caused by an “unspecified electrical event within the solar system installed above the roof,” Fresno fire investigator Leland Wilding, in an incident report.
In the intervening months, at least four other Amazon fulfillment centers have caught fire or experienced electrical explosions due to malfunctions in solar power generation systems, according to internal company documents seen by CNBC.
The documents, which were never made public, show that between April 2020 and June 2021, Amazon experienced “serious fires or arc flash events” at at least six of its 47 locations in North America with solar installations, affecting 12.7% of these facilities. Arc flashes are a type of electrical explosion.
“The critical incident rate is unacceptable, and it is above industry averages,” an Amazon employee wrote in an internal report.
The solar footage underscores the challenge Amazon and many other major companies face as they seek to reduce their environmental footprint and reduce dependence on fossil fuels. Amazon was among the most aggressive. In 2019, founder Jeff Bezos Launched The Climate Pledge, which promises the largest online retailer will eliminate emissions by 2040, embrace renewable energy and move away from gas-guzzling delivery trucks, including through a more than $1 billion investment in an electric car company Rivian.
Corporate America is under pressure from regulators and a growing subset of investors to set and communicate ESGs.
Many will be able to reap the financial benefits of renewable energy efforts after Congress passed in August Inflation Reduction Actwhich includes climate provisions that are expected to reduce the country’s carbon emissions by nearly 40% by 2030.
Commercial solar in the United States is expected to see 8% annual growth over the next five years, thanks in part to the legislation, according to Wood Mackenzie Solar Analyst Michelle Davis. She said warehouses could benefit greatly from solar energy, as they have large roofs and the systems can power all the heating, ventilation, air conditioning, refrigeration and other heavy energy systems found indoors.
But costly and dangerous issues can arise.
Solar systems on the roof of an Amazon Fresno warehouse caused a fire with three alarms in 2020.
Fresno Fire Department
Internal documents showed that by June of last year, all of Amazon’s US operations using solar power had to be temporarily shut down. The company had to ensure that its systems were properly designed, installed and maintained before any of them were “reactivated”.
Amazon spokeswoman Erica Howard told CNBC in a statement that the incidents involved partner-operated systems, and that the company responded by voluntarily shutting down its solar-powered roofs.
“Out of great caution, after a small number of isolated incidents with third-party owned and operated on-site solar systems, Amazon has proactively decommissioned our on-site solar installations in North America, and has taken immediate steps to re-examine each installation with a leading Technical experts in the field of solar energy.
These details did not appear on Amazon 100 Pages Sustainability Report for 2021 published at the beginning of August. In that report, publicly available via Amazon’s sustainability website, the company said rooftop solar was powering 115 centers of completion worldwide by the end of 2021, up from more than 90 mid-year. The majority of these are outside the United States
“Many of our completion facilities across the United States, Europe and India are powered by on-site solar energy, with a rooftop installation capable of powering up to 80% of the facility’s energy use,” the report said.
By April of this year, Amazon had solar power on site at 176 facilities, according to its website. Solar program launched in 2017.
“With the inspections complete, the on-site solar systems are restarting,” Howard said. “Amazon has also built a team of dedicated solar experts to oversee the construction, operation, and maintenance of our systems in-house to ensure the integrity of our systems.”
Any mention of expenses incurred by Amazon in the event of a failure is excluded from the general sustainability report. An Amazon employee estimated, in internally circulated documents, that each incident cost the company an average of $2.7 million. The costs included third-party audits of the rooftop solar systems, checking the amount of electricity they were generating, and repairing any broken or defective parts of the systems identified by inspectors.
The Amazon employee also said the company will lose $940,000 per month, or $20,000 for each of the 47 North American sites that have been decommissioned, as long as solar power remains offline. The documents show that there may be additional costs to Amazon depending on contracts with clean energy partners for renewable energy credits.
So far, Amazon has contracted with third-party sellers to design and install solar PV systems on rooftops and large backup batteries on site. other specialty Retailers, including Walmart And the targetingIt has also installed solar-powered rooftops and built programs to lower energy bills and achieve sustainability goals.
In addition to its warehouses, Amazon has some solar roof systems in Whole Foods stores. The documents said Amazon and its auditor, Clean Energy Associates (CEA), had postponed inspections of solar roof systems at Whole Foods locations until 2022. As of late 2021, four years after acquiring Whole Foods, Amazon was still working to obtain information Technology about renewable energy assets in stores.
Solar panels installed on the roof of a Walmart store in California.
To maintain strict quality control of solar energy systems, some Amazon employees have recommended more in-house operations. The fire in Perryville, Maryland, which was the sixth failure in just over a year, prompted the company to take systematic action.
On June 17, 2021, nearly a week after a fire at the warehouse known as MDT2, Amazon’s Sustainability Division directed owners and developers of solar roof systems in its US warehouses to shut them down. Solar roofs no longer generate electricity from the sun or produce renewable energy credits.
Amazon then hired Denver-based CEA to perform a third-party audit of rooftop solar systems in the United States, Asia Pacific, Europe, the Middle East and Africa.
Late last year, while the CEA was still conducting its inspections, Amazon reported one and 259 key findings across Amazon’s Rooftop Solar portfolio. Internal documents said problems included mismatched unit-to-module connectors, improper installation of connectors, poor wiring management, and evidence of water leakage in the reflectors.
Problems with inverters, which convert solar energy 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 reflectors,” according to an investigation report obtained by CNBC through a public records request.
Amazon blamed external partners and suppliers for the most significant problems uncovered by CEA and other teams working on the facilities and sustainability initiatives.
“Over the past five years, solar failures have been caused by incorrect installation techniques, improper operation of a new system, inadequate system maintenance, and equipment failure,” the documents said.
Amazon teams working on utilities and sustainability initiatives have developed a two-part plan to help prevent future disruptions to the rooftop solar program.
In late 2021, the departments requested $3.6 million to fund a re-examination of sites where key findings were identified in order to ensure the integrity of systems to reconnect to the Internet, according to internal correspondence.
Internal teams have also begun urging Amazon leadership to rely more on paid employees and less on external sellers. Over time, the company has hired more solar experts who focus on procurement, design, construction, and maintenance globally.
In some cases, management has been markedly slow to respond. For example, groups within a company urging for change have gone to leadership for it Approval of recruitment, re-inspection and reactivation plans. But the efforts were held up for months by Amazon’s top executives, including Kara Hurst, vice president of worldwide sustainability, and Alicia Buller-Davies, senior vice president of global customer fulfillment, which He left the company in June 2022, according to internal correspondence seen by CNBC.
Job opportunities indicate that Amazon is still seeking to hire people internally for its solar operations.
The company was recently looking for someone to manage sustainability projects across its North American facilities, which include rooftop solar. There is a stream existing For a technical program partner on the solar team, he says a key aspect of the job is collaborating with “internal partners” on global design, solar building and sustainability, among other departments.
As it tries to increase its number of employees, Amazon has acknowledged that the shift to the green comes with hurdles, especially for a company “of Amazon’s size and reach.”
“But at Amazon, we don’t shy away from taking on big challenges,” Hurst wrote in the letter that launched the 2021 Sustainability Report. “We don’t have all the answers today, but we believe we need to act now.”
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