Hello and apologies this has taken me over a month to do, I know some of you have reached out asking when I would have this finished. Hopefully this post will make solar less taboo, as its has never been more affordable and available to the public; contrary to some who think it’s a"luxury item". Little info about me UNR grad with biochem degree and pharm tech license, I’m a regional manager for a solar company and have been fortunate enough to co-manage a few teams across the states in NV, TX, FL, CA, and AZ with a focus in custom homes here in Las Vegas my hometown now. I honestly got into this profession randomly out of college and because it allowed me to scratch that itch to help people I got a lot of fulfillment out of it, and for me personally thats what drives me (making money doesn’t hurt either); not to mention door to door sales will really build some character/shatter your soul. Enough about me though let’s dive into some solar.
Apologies in advance I am not totally efficient with the forums but I will do my best highlight and structure the post so its easy to read. This will be lengthy as there’s a lot to breakdown, thanks in advance to @michael, hopefully I can provide some benefit like Leasehackr has for me.
3 Types of solar contracts - Loan/Financing (this is what 95% of my customers do), PPA/Lease, and Cash (only my custom home customers pay cash generally).
disclaimer: the only time you will be required to have a down payment is when choosing cash. Financing will have no down payment. ALL PRICES ARE GROSS PPW BEFORE TAX CREDIT
FINANCING: is essentially what most if not all my customers use, it honestly doesn’t make much sense to lease the solar system unless you have a particular situation (I have had a couple customers where owning the system didn’t make sense for them, everyone’s unique but its rare nevertheless). With rates at where they’re at it just makes far more financial sense to finance, you generally don’t make your first payment until 60 days after install and you can do so much with a loan I feel. Not to mention it makes it a hell of a lot easier to sell your home with an asset thats financed and you’ve been paying the principle on, as opposed to buying out the remainder on a contract that is a lease. Most my customers end up rolling their solar loan into their mortgage, or they let the next customer/homeowner assume the lower solar payment as opposed to buying the comp house next door that has no solar and is still paying the market utility rates. The most common financing that my customers choose is usually the 25 year 1.49% OR 25 year 2.99% depending what financiers they offer but generally my customers all choose the 25 year as its just nicer with a 30 year mortgage. Now thats not to say I don’t have a few customers who chose 10 year and 15 year plans (at same interest rate) so they could pay their system off faster (some people just dont like bills/owing money to people). The big names or most used in financing are Sunlight, Loanpal, Mosaic, and Dividend. If i had a gun to my head I would choose Loanpal and Mosiac as my top 2 favorite to work with and for homeowners.
PPA or power purchase agreements are a lot more common in CA and other states where claiming the tax credit isnt as important and/or they may not have the taxable income eg retired elderly people. This is the only time I find that PPA makes sense since you DO NOT own the product, the solar company owns that just like a car lease and they also get to collect the solar tax credit. The plus side of the PPA is you just pay a lower kilowatt/hour than the utility company (for example lets say PGE is .11 cents per hour, your PPA would be .08-.09 cents per hour but DISCLAIMER most if not all PPA’s have an escalator in them aka your bill will be hiked up 2-4% per year, great example of this is the Vivint or Sunrun solar programs. Sometimes a state wont allow a customer to own their solar and/or solar isnt setup in their state. (at one point in 2015-2017 it was outlawed in NV)
CASH: This is pretty straightforward, generally you’ll pay anywhere from 10% up front, 40% at install, and the rest of the 50% when your system gets turned on and has PTO (permission to operate). You get save a bit of money up front by dropping the financing/dealer fee for a lower cash price, generally anywhere from $2.20-2.80. Depending on your market and the company you’re dealing with.
THE STATE LEVEL: Most solar is the same when broken down, what varies is the STATE level in terms of what they allow for an offset and how they net meter. While there is a federal mandate for solar all across the US, some states have more or less regulatory issues. For example here in Las Vegas we have a rare monopoly with Nevada Energy (Warren Buffett owns NVE) and so they dictate a lot what occurs in terms of whats allowed. We cant over build a system here, so the MOST we can build a system here is 100% offset of solar or less than that but never over. But if you’re in CA or another state like NJ where they don’t have 100% offset but may have 200%, or they have more of a 60/40 or 70/30 solar to utility ratio. Thats why these states with the lower offsets require you to have batteries as the utility company isnt’ acting as your battery like in net metering. First thing I always tell customers is understand the state level and what your power/utility company’s program is currently running; most use “Net Metering”. Also state’s will sometimes still have incentives for switching ALWAYS make sure you’re not missing out on state incentives for making the switch to solar and/or batteries also. eg: Nevada used to have a state incentive that would pay $ per kw so customers were getting $2k-5k on top of the federal tax credit (that money ran out here in the state so be sure to check yours). Check to see if your state has a public utilities commission or some governing body over the utility companies, for example Nevada has the PUCN or public utility commission of Nevada. They’re the checks and balances for NVE here and they enforce the Bill of Rights for solar (yes we have a bill of rights for solar here in NV, along with HI too I believe)
Renewable Energy Bill of Rights
fun fact: New jersey has some of the top solar companies with 3 out of the top 10 from 2020 I believe was their last rankings, go NJ for going green!
FEDERAL TAX CREDIT: This is what a lot of people are hearing about right now as Biden just extended the federal tax credit, it was supposed to be hiked down every year at 4% rate from 30%, it was supposed to drop more but with the extension it will stay at 26%. This tax credit is SO IMPORTANT to understand, this incentive is a dollar for dollar match of your tax liability, so as long as you spend that much per year in taxes you will receive that $. The beautiful thing about this federal credit is that you have multiple years to claim it, if for some reason you wont be able to claim it all the first year. I have had several retired elderly people claim their tax credit over the course of several years. I LOVE this tax credit can be manipulated in so many ways, because most dont realize this isnt just a solar tax credit. ANY work you have done on your house can be wrapped up into this home improvement project eg I have had so many customers get a reroof for 10-15k and the tax credit of 26% was able to be applied with that too. So they got a reroof and a 40k solar system and it was all wrapped into a nice monthly payment that was a few bucks lower than what they were paying for power from the utility company. The total cost ended up being 55k but after the 26% tax credit its net cost was $40,700 give or take. Which if you subtract the 15k reroof would put that at the same price of 40k if there never was a tax credit, so its pretty cool what you can do with the financing. Heck I even had one friend use the remainder that he qualified for, took the remainder out from the loan at the same low solar % rate and landscaped his yard so the HOA would get off his back lol. Any work generally that needs to be done during the solar process can be applied; reroof, main panel upgrades, trenching, batteries, hybrid batteries etc.
SYSTEM SIZES: Each system size is measured in kW’s, some of you have probably looked at solar or have solar and know your system size e.g. 12.2 kW system. Every home is immensely different so try not to compare yours to a friends system or with someone in another state. EVERY system designed today is designed on your personal use and needs for the home, that’s why the last 12 months of the utility bill are needed. IF the homeowner hasn’t been in the home at least a year then sq footage is used to calculate the usage.
PRICE PER WATT: For the sake of conversation all ppw is GROSS and not net ppw. All solar is broken down to PPW (Price Per Watt), this is the price that all solar companies base their cost and pay structure off of, the best way to make sure you’re getting the right price is finding out what your PPW is. You can break down the pricing by taking the total system cost and dividing it by system size in WATTS (make sure you add a few zeroes), and that will give you your PPW. eg: $43,438 / 12,200 = $3.56 PPW.
-A fair and competitive “LH” price-
A good PPW you should/could aim for is $3.60 to $3.80 if you want to make it competitive for the solar companies, generally most systems are sold in the $4.00-4.45+ range. If you’re getting lower into the $3.50 or lower range you’re in family friend discount area, if you’re $3.00 or lower thats cash price area. THIS IS BASED ON GROSS PPW NOT NET
SYSTEM PRODUCTION or ESTIMATED PRODUCTION: This is crucial to understand as this is what guarantees your system will cover your needs. You can find out what your system needs to produce to cover your energy needs by getting your usage from your utility company. You’ll need the last years usage with the monthly breakdown; 12 month breakdown will give you the most accurate system required DO NOT GO OFF YOUR MONTHLY BILL. I cant tell you how many horror stories from the past I have heard of Tesla/Solar city or another company like Sunrun grossly miscalculating someones system because they went off their $ amount per month or for the year and the customer got screwed. For example a 12.92 kW system will generate 20,035 kWh with 38 Hanwha 340 watt panels.
SOLAR PANELS: if theres one thing I can stress its do not worry so much about the panels, theres so many damn kinds out there as long as you have one of the top 4-5 and they’re HE(high efficiency) monocyrstaline (polycrystaline are the ugly old blue panels) panels and at least 310-340 watt you’re going to be fine. Most solar panels last anywhere from 40-55 years, I believe the White House just barely replaced the solar panels from the 80’s lol. You cant go wrong with the best bang for buck panels, just like leasehackr with solar panels the middle of the pack 340 watt panels seem to be the best right now in terms of cost and future longevity. Theres really no reason to get the “Ferrari” 360+ watt panels or stronger as you’ll be overpaying so much you’ll wish you leased a telluride and palisade For those of you who are engineers and care about degradation rates you cant go wrong with most the major high efficiency panels, they generally are at about 82-85% efficiency by year 25.
- Longi - In business 21 years, great black on black monocrystalline panels, probably one of the best bang for buck 350 watt panels (I generally build with these)
- Hanwha / Q CELLS this is the one of my most used brands also, Korean company German Engineering; solid monocrystalline panel
- Sunpower (lots know this brand as one of the industry leaders, but they’re like a lambo in cost
at times depending on the wattage, but great reputation)
- LG (ike Sunpower very high efficient they have amazing 370 watt black on black series)
- REC (Great company one of the best for black on black mono panels and their alpha series is wow
if you don’t mind spending a pretty penny)
- Silfab (another company I like to use a lot, they assemble in the US and Canadian company,
- Panasonic (I am only listing them because they’re popular somewhat and at one point had the best
panel out but they’re getting out of the solar panel business) “Panasonic announced today that
it will cease the production of solar products at its Malaysian and Japanese factories,
completely exiting the solar panel and wafer market by March 2022.” feb 2021
*disclaimer— panels are extremely strong and Industrious, most panels can take a golf ball size hail at 230mph and not even break or shatter. Don’t worry about maintenance as there isn’t a bunch of cogs and wheels in the panels. It’s just extremely strong glass and fluid that converts sunlight to energy.emphasized text
-INVERTERS: Most people don’t realize this is the most important part of your system as it is the workhorse of the entire solar system, as its the main proponent of converting your DC (direct current) to your homes AC (alternating current). Theres honestly only two major inverter brands that people use Solaredge and Enphase.
SolarEdge is probably the most popular and what MOST homeowners use, as its just a cheaper cost and achieves the same goal. Most solar edge systems have Optimizers attached to the system these days, and what this does is prevents the system from under performing if theres ever any shading on a single panel. Some of you may know who have had solar, back in the day if your solar system had a panel that was shaded or not working then the ENTIRE system would struggle aka just like when a Christmas tree light goes out, the entire string would go out. This is known as a string inverter system; now all string inverter systems come with optimizers to prevent this from ever happening now. Solar edge inverters can come with EV (electrical vehicle) plugs also, so you can plug into your inverter and have your system directly charge your car. https://www.solaredge.com/us
Enphase is another big name and some of you probably own Enphase stock! Enphase inverters are known as MICRO INVERTERS, they’re different than the string inverter system, in that each panel gets its on micro inverter, this achieves the same goal as the optimizers and micro inverters run cooler than string systems. The only time I have seen micro inverters make sense is #1 personal preference (some engineers prefer micro inverters and are Enphase buffs trust me I have met them theyr’e serious people!) #2 when you have multiple solar arrays. What I mean by that is when you have a bunch of pitches on your roof and you have solar panels all over, micro inverters may make more sense because you dont have to run nearly as much conduit across the roof. Previously in the past micro inverters would outperform string inverter systems, but now in 2021 they’re almost identical with solar edge systems producing slightly more over time and having the ability to plug into your inverter, Enphase micro inverters unfortunately do not have that ability but they dont run nearly as hot temperature wise. So at the end of the day its really personal preference. Reliable solar inverters for solar panels - Enphase microinverters
BATTERIES: As it stands right now coincidentally the Tesla Powerwall is still the best battery $ for $. They’re the top battery in terms of stackind and in terms of load/capacity. There are some higher end ones out there but theyre far too expensive. Not to mention theres several batteries that are about to come out from other competitors, so pricing may get better in the future. For those true hackers though, there are hybrid batteries that you can have on a time of use plan where you essentially have the battery only work during peak hours, and off/charging from the panels during hours when your utility company has low rates. This varies vastly per state though, but I have had a few customers do this hybrid battery setup cause they felt it made more sense for them financially.
ROOFING: there’s only a few types of roofs but a majority of homes have pitched angled roofs. This is the most common install and they’re on a racking system, very straightforward. Flat roofs will use a ballast system that will pitch the panels at an angle facing the sun. These can sometimes provide a little more power due to their perfect alignment with the sun, far more prevalent in CA. The systems used to hold the panels on the roof are pretty damn industrious. They withstand 200mph winds like it’s their job!
GROUND MOUNT: some solar projects will have ground mounted systems, this is far more common in rural areas or areas where there’s a ton of yardage and the roof isn’t suitable. These installs are usually a bit more expensive as it requires trenching the line out from the panel/house out to the system.
HOW: So how do we calculate these systems to make sure the customers going to get the right sun hours we claim? Good question! We use a program called Aurora, and what they did is took the sun hours for the earth over the last 60 years and developed an algo that will show you sun hours for N,E,S,W etc. Most of you probably know this but you get the most efficient sun hours from the South/Southwest facing roof, then it goes West slightly ahead of East, then North being the worst where it takes 2-3 panels to achieve the same of 1 southwest panel.
So how do we view solar in lay-mans terms? Something I tell people is solar is just a bill swap program, you’re replacing one bill that will escalate year over year (around 4-7% / year and is something you rent (you might as well burn that utility bill in the fire you get zero return from your payments) with a bill thats a LOCKED in rate, that will NEVER increase, and has an END day. Just like your 30 year mortgage, every month your’e making that payment you’re adding equity to your home (unless you went the PPA route you’ll just be paying less per kWh). Also known as Irradiance; " which is the power per unit area received from the sun in the form of electromagnetic radiation. Aurora measures this in kWh/m2/yr"
For example, customer A has an average utility bill of $201 per month over the course of 12 months he uses 20,143 kwh, so he will need a 12.29 kW system that will produce 20,035 kWh which will provide 99% of this customers power with 38 Hanwha QCELLS 340 watt panels. So this system would cost $155/month and this includes EVERYTHING; installation, 25 year warranties, monitoring from the company and yourself on the app, the hardware panels and inverters and conduit. So he will be wiping out his energy bill of $201, and replacing it with a $155/month bill that will NEVER go up and will provide all his energy and this has an end date once it’s paid off along with increasing his equity. (This example is for Nevada or any other state that allows 100% offset of solar).
CREDIT: Credit is pretty straight froward as long as you don’t have a bankruptcy in the last 2 years and you have a credit score of 645-650+ you will qualify for the rate being offered and usually for the max loan amount. They’ve become more lenient over the years, I pass people with credit scores of 600 quite regularly.
COMPANIES/WARRANTIES: something I cannot stress enough is besides inverters, the 2 most important things when it comes to making a decision on solar is the company and warranties. You can have all the best products in the world but if your installation, customer service, and warranties aren’t good; you’ll get a poor installation job, issues with production (aka over promising and under delivering) permitting process taking too long, among other things. Generally companies have a 25 year warranty on their panels and a 25 year on their inverters, what you really want to find though is a warranty on the production if possible. For example, we offer a 25 year production guarantee that states we will guarantee the production promised on the contract, if for whatever reason the system is under producing or over producing or whatever issue is going on, we would come and fix or replace anything needed at our cost of course. There’s a few companies I believe that now offer this production guarantee. 10 year roof and workmanship warranty/guarantee is a crucial warranty you want to make sure comes with your system, most good standing companies will offer a roof warranty that re-warranties your roof in the area they install/drill/work on the roof etc. People sometimes ask what happens if the solar company they went with goes out of business for whatever reason, and as most of you probably know just like any of these, the manufacturer warranty would carry over/be assumed and those have 25 year to 30 year warranties.
Popular companies with good BBB ratings, good installations, and pricing/products and are national:
- ION Solar
- Freedom Forever
- Blue Raven
Take these with a grain of salt I am not trying to poopoo the companies just either my experience or many previous customers first hand accounts.
-Popular but not known to have the best reputations or customer service:
- Tesla/Solar City (far too many horror stories from customers, their new rental program looks interesting though)
- Vivint/Sunrun (the ubiquitous costco solar that we all see, I have first hand experience when I started out with them, but not the most stellar rep and the installs have given me nightmares)
- Titan Solar
SALES REP: This part is actually pretty important, as you guys know from using a broker for leases, having a good rep can be pretty damn crucial. You’ll want someone who is pretty hands on, I don’t think there’s anything wrong with someone who is new to the industry as your rep, but just make sure they’ve extremely attentive. I think the biggest thing you can see is if you can text or call your rep whenever you have questions (obviously reasonable hours haha). Nothing worse than someone signing you up for solar and they pull a vanishing act on you and you never hear from them again. So make sure you have a rep you trust at the end of the day! I am sure that goes without saying but I just wanted to stress that; it is a relief you can shoot your rep a text and he responds right away and his actions follow his words.
HELPFUL QUESTIONS TO ASK DURING YOUR SOLAR PROPOSAL/PITCH
How long have you been in business?
Do you have an in house installation crew?
How long after I sign the contract will it take to get the panels installed? weeks,months?
Who is the contact person aside from yourself that I can work with if there are issues during the install.
I will be editing this regularly as I am sure theres a few spelling errors or run on sentences, or as more information changes/updates. I do apologize as I have been typing this over the course of a few days.
Ill be adding photos soon as I can figure out this screen grab off the app, it will help break things down more simply and visually with graphs and charts and full #'s with a mock proposal
Feel free to DM me if you have questions or want help dissecting a deal/proposal you’ve been offered or ask questions on here I will do my best to answer them.
Solar calculator - Solar Calculator: Estimate Solar Savings | EnergySage
Top solar contractors ranking list - 2020 Top Residential Solar Contractors
California Consumers Protection Guide to Solar - https://www.cpuc.ca.gov/uploadedFiles/CPUC_Public_Website/Content/Utilities_and_Industries/Energy_-_Electricity_and_Natural_Gas/Solar%20Consumer%20Protection%20Guide%202021_English_v2.pdf
SCE Net metering guide (Southern California Edison) - https://www.sce.com/sites/default/files/inline-files/NEM%20Fact%20Sheet.pdf