April 12, 2017

HMM: US Residential Solar Is Set for a Radical Makeover.

The problem plaguing the market is not demand, but how demand is being met.

Many articles have analyzed the cause of the current turmoil and what it means for the industry going forward. In a recent GTM article, Andrew Beebe pointed to a rapid commoditization of hardware and financing, as well as a proliferation of specialized productivity tools, to explain how local solar installers have steadily eaten up market share from the retreating national brands.

The overhead-intensive, vertically integrated model has given way to more agile local providers who can deliver better service and better pricing. We at PowerScout have seen this trend developing firsthand throughout our partner network.

The other problem is solar just isn’t that economical. I ran the numbers on our house, and they weren’t encouraging. Even with the cold-but-sunny winters we enjoy on the Front Range and generous tax subsidies, our projected cost savings would only amount to three or four thousand dollars — spread out over 20 years. Take away the tax breaks — i.e., forcing the neighbors to pay for our solar panels — and we’d lose a little money on the deal.

And if everybody converted, in the end we’d all take a loss.

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