Guide to selecting a Solar Installation in L.A.
Solar is everywhere – panels on neighbor’s roofs, ads on the Internet, colorful commercials on TV – solar energy finally has arrived in California. Last July, Governor Jerry Brown held an invitation-only conference at UCLA to affirm his plan to develop 20,000 MW of renewable energy in California before 2020. That is 3,000 times more solar than the entire U.S. installed last year.
Californians are the trendsetters of the nation and the commitment to the environment is strong across the political spectrum. A recent survey shows 80-90% support for solar. Only the high cost of solar has kept many homeowners away from installing panels on their roof.
But that has changed in 2011. Panel prices have fallen dramatically due to the current overproduction. Tax incentives and utility support are at a high level. Interest rates are near historical lows. These factors have brought down prices far enough to make solar competitive with grid electricity.
For a savvy homeowner, these are the signals that 2011 may be the best year to go solar. But only one in five is fully qualified to do so.
Here is a short checklist
1. Is your roof suitable? You can check at solarmap.lacounty.gov.
2. Are all homeowners in favor of solar?
3. If you need financing – is your credit rating good enough?
4. Is your bill high enough? Savings are greater with bills over $150 per month.
There are three different ways to go forward:
The Solar Lease
The traditional solar installer
Do-it yourself
The Solar Lease
Most homeowners choose to lease their solar system. The advantages are obvious. There is little or no out-of-pocket cost. The provider will manage the system for 20 years and do the necessary repairs. And the cost savings over the next 20 years are often spectacular.
Solar lease providers look similar at first, but there are significant differences. Some lease payments increase every year, thereby reducing the savings. Some companies finance through bank loans, which show up on your credit report.
Make sure that your provider has the same interests as you, namely to keep your system running smoothly and do repairs quickly. And make sure, the company has in-house financing, so that you can threaten to withhold your payment until you receive service.
Leases are convincing many homeowners to go solar. That is why Scientific American included the solar lease in it’s 20 world changing ideas (scientificamerican.com/article.cfm?id=world-changing-ideas).
The traditional solar installer
Solar energy systems are installed by specialized companies. Some of these have been set up to only install photovoltaics, while others have expanded from installing roofs, plumbing or electric. In general they provide excellent service and will have a string of satisfied customers. When selecting an installer, you need to check references, have a look at other installations, compare prices and warranties and find an installer who can meet your time and money targets.
You need to pay for the entire installation cost, except for payments from the California Solar Initiative, which can be assigned to the contractor. Next April you can subtract 30% of the installation cost from your tax bill, if a number of conditions are met.
Solar energy systems do not need much service, but it is good to keep an eye on the output to make sure everything is operational. If a panel or inverter needs replacement you will need the contractor. This is a good reason to select a larger, stable company that will be around for at least the term of the warranty, best for the life of the system.
Be aware that your interests and the interests of the contractor are not aligned. Your need for long-term operation and low price are diametrically opposed to the needs of the contractor to cut corners and charge more in order to achieve profit. This is why you need to do careful homework to find the right one.
If you can use the tax credits and find good financing, you may be able to save some money compared to the lease, but you will have to do more work on your own, assume the risks and have less money to spend on other things.
Do-it yourself
Solar panels have fallen in price and there are offerings for entire packages on the Internet that are 50% of the contractor’s price. It may make financial sense to install your own solar energy system, if you are well versed in construction.
However, a solar installation is a 70-step process that the installer has spent years understanding. From permits to utility approval there are countless pitfalls and accidental damage to the roof and electrical circuits can be very expensive. 30-50% of the installer’s bills are costs beyond the mounting of the panels.
Be aware that your knowledge has gaps and that some of the required information is not easy to come by. Wrong decisions can have costly consequences. It can be more difficult to get the tax savings. But this option will save you a lot of money, if you are willing to go the extra steps and assume all the risk.
Choosing the right path forward can be a daunting task, but it will prove worthwhile over the years to come, as some utilities are looking to increase their rates 40% over the next three years alone.
Tens of thousands of solar systems will appear on the roofs throughout South California in the next years. They are a signal that we don’t need to succumb to the climate crisis and dangerous energy politics, but that homeowners can take positive action that makes our world a better one.