As utility prices continued increase and the cost of solar energy solutions declining, more and more homeowners are are making the decision to invest in solar energy. According to Zepryme Insights the US residential solar market will grow from 2011’s $1.2 Billion to a forecasted $4.7B in 2016 and the US market should experience 33% annual growth through 2016. And According to Solar Market Trends 2011 was the biggest year on record for solar installations in the US. For the second year in a row, solar energy will be the fastest growing industry in America.
As is the case in other fast growth industries, there are countless numbers of service providers who want your business and who are driven to sell you as much as they can and for as much as they can without any consideration for your particular needs. Many solar companies typically propose a system based on how many panels they think they can squeeze on your roof! Having been on both the sales and installation side of this industry for over 6 years, I can tell you that I see many homeowners make these 3 common mistakes when buying Solar Electric Systems.
- Failure to maximize your home’s energy efficiency prior to installing a system – I often ask a homeowner if they were to move and hire a mover (paid by the box and by the hour) would they have that mover move everything in their current garage and storage closets to their new home. Or would you first purge a bunch of your “junk” first. Of course all say that they would clean it out first, thus optimizing the home in preparation for their move. Similarly, if your home is energy in efficient, you will require more panels and spend more money in order to produce enough energy to cover both your use and your waste. A homeowner should evaluate and implement energy reduction solutions prior to installing energy production solar equipment.
- Not factoring the utility company’s multiple plan options when sizing a system – Far too many homeowners go out and spend excess dollars on a system to reduce their energy bill to almost zero (excluding fees, taxes, connect charges, etc) as opposed to first figuring out the best plan that can be combined with their system, thus beating the utility company at their own game. For example, if you can buy off peak power from the grid for $.04/kw hr, then you may wish to size a system that only addresses your peak energy usage. Tough to justify alternative energy solutions to offset $.04/kw hr
- Not doing a thorough lease versus buy financial analysis – Companies that offer solar leasing solutions will obviously push the virtues of a lease and conversely, companies that only sell solar systems will be strong advocates for a sale. You need to analyze both. The Federal tax credit of 30% (due to expire 2016) may make a purchase more feasible for someone with a large tax burden whereas a lease may make more sense for someone looking at cash flow only. Either way, be sure you clearly understand the pluses and minuses of both options and seek the right financial advice.
While we have focused on the top three mistakes, there are plenty of others! Work with a reputable company who is accredited with the BBB, and one who has installed at least 400 systems. And you want to look for a company who is big enough that you know they will be in business for the long run, but small enough that you have access to senior management for maximum customer support.
For more information and guidance please contact us at 1-844-272-8336.
3 Comments
Cindy Jefferson
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John Snow
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Mike Newton
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