How To Choose the Best Solar Installer For Your Home

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Solar panels are a significant long-term investment that requires potential repair throughout their operational life. Homeowners could face challenges if the solar company responsible for PV installation goes out of business, especially without Solar Insure protection.

While it is reasonable to expect the installation company to be accessible for the duration of PV’s lifespan, the reality is that there is always a risk of them closing down. Many factors can lead to a company’s shutdown. However, depending on your specific situation, you can take several measures to protect your system when choosing the best solar installer possible.

Understanding the solar industry landscape

In 2010, the total residential power generated by solar panels in the United States was 667 MW. According to the Solar Energy Industries Association (SEIA), this figure had raised to about 20,000 MW in 2021. The solar power industry in the United States produced 6.1 GW of power in its first quarter of 2023, representing a 47 % rise compared to the previous year.

Figure-1: Annual residential & commercial solar installations in the United States (SEIA).

With a record-breaking first quarter in 2023, the solar energy market in the U.S. is positioned for overall growth despite a number of current hurdles faced by solar companies, such as high-interest rates, attacks on net metering, falling stock prices, stabilizing utility costs, and regulatory shifts are all having an impact on solar companies.

Reasons for solar company closures:

• High-interest rates – The increase in interest rates has made loan packages less attractive to homeowners, with accompanying loan dealer fees also rising significantly.
• Stabilizing utility electricity prices – With utility electricity prices stabilizing or even decreasing compared to the previous year, the cost-saving benefits of installing rooftop solar panels are less clear to potential customers.
• Drop in residential solar stocks – Following a Tesla earnings call, significant solar companies have experienced substantial drops in stock value, with some companies seeing a 30% reduction in a single day.
• Bankruptcies and shifts in business models – There has been a notable increase in bankruptcy filings among residential installers, with over 100 reported in the past few months. Installers are shifting towards third-party-owned leases or power purchase agreements due to less attractive loan terms.
• Net Metering Rules: States like California and Georgia have eliminated or drastically reduced compensation for homeowners exporting solar energy, which has led to a significant reduction in installations.
• Nationwide policy shifts – There is a concern that the regulatory environment in California might set a precedent for other states, with places like North Carolina and Arizona already considering policies that could negatively impact residential solar.

Despite these challenges, people are still choosing to go solar because it is the way to future-proof your home’s energy and become resilient for the future. 

The impact of solar company closures on homeowners when choosing an installer

Homeowners may be left in the dark when a solar company goes out of business. They risk having unfinished solar installations, poor maintenance solutions, or a lack of warranty service if the installer doesn’t pay for their warranty before closing. 

When the PV system is ready to power on, the system must pass an on-site assessment and a utility inspection to get PTO (permission to operate). If your solar company goes out of business before receiving PTO on the property’s panels, then the homeowner must go to the city for approval. 

Consequently, when this happens, trust in the clean energy industry declines, reducing the growth of solar power installation among those interested homeowners. This is why Solar Insure was created and teams up with installers to deliver Solar Insure products with every new installation.

Warning signs that a solar company might be nearing closure

Strategic hiring and spending pauses 

If a solar company enacts widespread hiring or spending freezes across various sectors or the entire organization, it could be a prudent measure or an indication of budgetary constraints. Such freezes are often strategic responses to economic challenges and may suggest that the company is taking a conservative approach to managing its resources more effectively.

Operational streamlining through layoffs. 

When a company undergoes layoffs or strategic reorganizations that consolidate or remove positions, it may streamline its operations in response to market demands or internal financial targets. While these changes could point to a need for cost reduction, they may also represent a realignment of the company’s structure to fit its long-term objectives better and improve operational efficiency.

Legal challenges 

Legal entanglements can impose hefty financial burdens on a solar company through direct costs and reputational damage. Persistent legal issues could divert significant resources away from core business activities, potentially jeopardizing the company’s future.

Financial instability 

Restricted cash flow can be a precursor to a solar company’s downfall. Indicators like declining sales, slow growth, and extended payment cycles may reflect an inability to meet market demands within the existing business market.

Poor customer feedback and reviews 

Regularly reviewing customer feedback is essential. A recent pattern of negative reviews, especially regarding unresolved system issues, can be an early warning sign of a solar company’s operational weaknesses, possibly contributing to its closure.

Pushing for immediate starts 

A reputable solar company will thoroughly assess a building’s suitability for installation without undue pressure. Conversely, a company that rushes engagements without proper evaluation might be cutting corners, potentially indicative of financial desperation or a short-term focus.

Tips for Homeowners on How to Choose the Best Solar Installer

All of these factors are helpful to uncover which installers to avoid, but what are the best steps to take when choosing an installer? You can take a shortcut and call Solar Insure; our team will advise you on the best installers in your region. 

Reviews from previous solar company clients are a great way to evaluate installers. If published ratings are insufficient, contact a prospective solar firm for prior customer references. They will be delighted to give you a list of positive feedback. If they cannot, that’s a warning sign.

Ensure that the installer you select is licensed by NABCEP, registered, and guaranteed to work on domestic solar systems in your region.

When choosing a solar installation, it is critical to examine the warranty supplied by the contractor. Verify that the warranty includes the photovoltaic panels, inverters, roof penetrations, parts, and labor and is covered for the life of your panels.

When choosing a solar installation, it is critical to examine the warranty supplied by the contractor. Verify that the warranty includes the photovoltaic panels, inverters, roof penetrations, parts, and labor and is covered for the life of your panels. The critical thing to note is that If the installer goes out of business, the installer or the workmanship warranty will be void. Solar Insure’s 30-Year Monitoring and Warranty will cover whether the installer is in business or shutters – this is where peace of mind comes in. 

Important questions to ask your potential solar installers 

• What is their working experience?
• How many solar installations have they done?
• What is the review of their consumers?
• Will they offer any incentives?
• Are they certified by NABCEP?
• What will be included in the warranty?
• What happens to the warranty if the installer goes out of business?
• Do you have different kinds of PV panels, batteries, and inverters?
• Will they hire a subcontractor for installation?
• Can they present some samples of their job?
• What will be needed for system maintenance?
• Are they Solar Insure Certified Installers?
• Do they have an active contractor’s license number?
• Do they have General Laibility and Workers Compensation Insurance?

Do not simply ask the above questions. Spend a few minutes examining the various responses you may receive. You can learn to spot credible and reputable solar installers with a little study and excavation.

Always Get Multiple Quotes

Receiving a minimum of three quotes allows you to evaluate pricing and funding alternatives. Getting many quotations also will enable customers to understand each company better.

Note that the cheapest offer is not necessarily the best one. Cheap does not always indicate poor; however, if a company’s price is much lower than its competitors, they’re likely making shortcuts somewhere. This might be due to poor-quality devices, bad skilled work, or failure to pay their workers a living wage.

Life with Solar Insure is Sunnier

To avoid many of the pitfalls that can happen beyond the control of the homeowner or the solar installer, Solar Insure provides lasting protection with our 30-Year Monitoring and Warranty.

Homeowners can look for all these warning signs when choosing an installer; however, if they install their system with a Solar Insure Certified Installer that ensures all of their paperwork and payment is processed correctly, they are hedging their bets in case anything goes wrong. That is whether the manufacturer or the installer goes out of business, whether they have a faulty part or need a service repair person to fix their system. With Solar Insure, you don’t have to carry the burden of figuring it out alone. 

Connect with the Solar Insure team to find a Certified Installer. 

Resources
Solar Energy Industries Association (SEIA), https://www.seia.org/solar-industry-research-data

Southern California Edison, https://www.sce.com/residential/generating-your-own-power/net-energy-metering/Permission-to-Operate

Policies and Policy Governance USC, https://policy.usc.edu/layoffs-and-reorganizations/#:~:text=Layoff%E2%80%94reorganization,resulting%20in%20termination%20of%20employment.

https://www.mdpi.com/2227-9091/11/8/144