Category: "Ranting"

05/30/18

  02:52:00 pm, by Jim Jenal - Founder & CEO   , 321 words  
Categories: All About Solar Power, SCE, Energy Efficiency, Residential Solar, Ranting, Solar Policy

Solar Policy: A Victory and a Challenge

As a reader of this blog, you care about solar policy making, and are no doubt aware that the utilities are constantly trying to erode the value of solar.  Recently we notched a big win, but at the same time the need for vigilance is ever greater.  Here’s our take…

An Historic Win

First the win - as you have no doubt heard, starting in 2020, California will require that all new single-family homes include a solar power system.  (At present, about one in five new homes has solar added when built.)  This will help California meet its ambitious goals regarding greenhouse gas emissions, and will continue California’s leadership in home energy efficiency.

An Ongoing Challenge

As exciting as that news was, it makes it far to easy to overlook the constant, ongoing efforts of utilities, particularly the Investor-Owned Utilities (IOUs), like SCE, to erode the value of solar.  Case in point, SCE has a rate case before the California Public Utilities Commission that attempts to create rate structures that are blatantly hostile to solar power systems.  That means that SCE customers who installed solar in good faith, could see the value of their investment diminished thanks to a concerted effort by SCE to do just that!

Solar Rights Alliance

Fortunately you don’t have to take this lying down.  The Solar Rights Alliance (formerly known as Solar Citisuns) is working to organize solar system owners into a potent political force to push back against the army of lobbyists employed by the IOUs.  There are over 700,000 solar system owners in California - that is an interest group that needs to be heard.  By joining the Solar Rights Alliance you will help to make sure that your interests are being heard by legislators and regulators alike.

It is easy to join: just follow this link to become an active member of the Solar Rights Alliance.  The IOUs have the lobbyists, but we have the people!  Be heard - join today!

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04/13/18

  11:10:00 am, by Jim Jenal - Founder & CEO   , 2082 words  
Categories: All About Solar Power, Solar Economics, Residential Solar, Ranting

My Electric Bill is So High! Will Solar Help? Part 3: Evaluating Competing Solar Proposals

Editor’s Note: This is the third installment in our three-part series:
My Electric Bill is So High! Will Solar Help?  
You can read Part One, How High is High, here, and
Part Two, How Do I Find Someone to Trust, here.

With apologies to the Lovin’ Spoonful, eventually you have to make up your mind between those competing bids you’ve received, but how?  Let’s walk through the proposal evaluation process and see if everything that you need to see has been included!

What’s in the Proposal?

Solar proposals come in all shapes and sizes.  Some are very short – just a listing of what will be provided, a price, and a place to sign.  On the other end of the spectrum are proposals that are twenty pages long, most of it boilerplate about what is solar and how does it work, and what a great company this is.  But strip away the boilerplate and are they really giving you much information that is specific to your situation?

What were the inputs?

The old saying, GIGO: Garbage In, Garbage Out, applies to solar proposals too.  In this case, the inputs are your past energy usage, and a detailed site evaluation that looked at your service panel and your roof.  Omit any of those inputs, and the output is likely to be of dubious value, or worse, it will mask the true cost of installing solar at your home, leaving you exposed to costly change orders down the road when the contractor “discovers” something that should have been addressed at the proposal stage!

Your energy usage for the past year is the key input – without it you’re flying blind.  If you are in SCE territory, your potential installer should be asking for access to your  interval data.  For most residential clients, that is hourly usage measurements over the entire year, and that is important to accurately model your savings under now mandatory, time-of-use rates.  Where interval data is not available, monthly, or worse, bi-monthly billing records can be used, but they will not provide the granularity needed to see how the proposed PV system will actually operate to offset your daily loads.

Seasonal load profile comparison

Assuming that interval data is available – we ask our clients provide it through a secure service called UtilityAPI – it is the installer’s responsibility to properly analyze it to know how large a system you need.  As we mentioned in Part One, we use Energy Toolbase for our data analysis as it is the most authoritative tool on the market.  The chart above shows the average seasonal usage for one particular client as processed by Energy Toolbase from the raw interval data.  This shows the average hourly usage over spring and summer, with a very dramatic peak on summer weekends around 5:30 p.m.  Recall from Part One about “low-hanging fruit” – what you are seeing here is an excessive A/C demand that, if it can be addressed, would greatly reduce the size of the PV system needed for this client.

Ideally, this analysis takes place before the site evaluation so that the installer is able to advise the potential client about actions to be taken to reduce their overall usage, and thereby end up with the most cost-effective solution tailored to their needs.

Detailed equipment line items

One of the things that we see on competitors’ proposals that never ceases to amaze us is the total lack of detail regarding the actual equipment that is going to be installed!  It is as if the homeowner is expected to pay thousands of dollars for a generic solar power system – but you wouldn’t spend thousands on a generic car, would you?  Moreover, how can you assess the value proposition of a generic system?  A company that proposes a generic system intends to install on your home whatever is on sale that week.  Maybe you get lucky, more likely you don’t, but in either case, you simply don’t know, and that is no way to make a major investment.

Your proposal should have line items for all of the major components of your system: the solar panels, microinverters, racking, and installation costs.  And those items should be specific, down to the model being selected and the per unit cost.  Only that level of detail allows you to see what you are getting and for how much.

Utility savings analysis

Determining how much your proposed PV system will save you in Year 1 is the key to the entire analysis of the proposal, and it is a two-step process.  First, your historical usage data is analyzed against your current billing rate to determine what your energy costs will be over the next year.  There are a couple of assumptions built into that assessment, namely that both your usage and your billing rate will stay the same.  If you have been in your home for awhile, your usage last year is probably a pretty good predictor of your usage next year.  On the other hand, if you moved in rather recently, or made a major purchase like a new EV, that will skew your usage going forward.  Similarly, last year’s bills were predicated on the exact details of your billing rate structure in effect at that time – and those are subject to change without notice.  So look at what the proposal projects for your bill next year without solar, and see how that compares with last year.

The second part is the more important piece - assessing how  your bill will change now that you have added PV.  Here’s where things get complicated, and a tool like Energy Toolbase becomes essential.  The proposal should show a model of your past usage overlayed by the production of the PV system.

PV production overlayed on historical usage

As you can see in the graph above (click for a larger version), the darker blue is the historical usage (we are looking at two days in July), the green is the modeled production from the proposed PV system, and the pale blue is the net energy demand.  At the peak on the right, the PV system is producing 5.22 kW at a time when the historical demand was 11.95, meaning that the net demand from the utility is 6.73 kw – and that is the basis for what the client will be billed.  You can also see that there are periods in the morning when the system is producing more power that the client historically used, resulting in power being exported out to the grid – for which the client is compensated due to net metering.

This is the analysis that must underlie your savings analysis – anything else is simply guess work.

Cash flow analysis – payback over time

Part of any cash flow analysis is the cost of the transaction.  If you are making a cash purchase you know exactly what your transaction costs will be.  But if you are financing through the solar company, or heavens forbid leasing, those transaction costs may well be obscured, it not hidden altogether.  Make certain that you have all the information you need to determine exactly what that deal is going to cost you.

For the sake of discussion, we will assume that this is a cash purchase.  What other assumptions go into a proper cash flow analysis? To start, how long is the period of the analysis?  Ten years?  Twenty years?  Thirty years?  Beware of an analysis that simply says how much money you will have saved in the end, without calling out the period in question!  In our view, ten years is too short, and 30 years is too long.  But whatever the number is, make sure you are aware of it as you compare “total savings!”

Another key assumption is how much will utility rates go up over the lifetime of the analysis?  It used to be common to see rate escalators of 6-7% per annum, but there was no real data-driven basis for that number.  (In fact, long ago we used 6.7% based on a website that claimed that the California Energy Commission had published that figure.  But when we went digging for the source, we discovered it didn’t exist - there was just this circular linking of sites each claiming to have gotten this from the CEC!) 

Over time we have consistently reduced the value that we use for our models, so that now we are using 3%, which we think is reasonably conservative.  But this is really a matter of just throwing darts at a board, and no one really knows what that number will be. Keep in mind that for comparison purposes, you should be able to see what value was used, and the higher the number, the rosier the prediction!

PV systems degrade over time, and that output diminishment should be accounted for in the analysis.  Modern solar panels degrade less than 1% per annum (the LG panels that we use are around 0.5%), but in any event, make sure that is incorporated in the model.

Finally, the value of money in your hand today is, generally, worth more than money you will have at some point in the future.  How much more valuable is a function of the discount rate applied to those future savings.  If the model ignores that, your future savings are likely artificially high.  Again, no one knows what the right number is, but a proper model will account for it and allow you to know what you are comparing.

What’s in the Contract?

Strictly speaking not a part of the proposal, it is not a bad idea to ask to look at the contract before you pick a contractor.  Many solar contracts are very long, written in tiny fonts, with lots of legalese – all designed to make you throw up your hands and simply ask, where do I sign?  But slow down, friend, the devil may be lurking in those details!  Indeed, we have had clients who were ready to sign with another company until they looked at what was in the contract!

Ideally the contract should be written in plain English, it should clearly set forth what will happen, when, and how, and it should be even-handed.

An Important Caveat

Finally, it is important to call out what even the most carefully considered proposal cannot address - future uncertainty; in particular, what will utilities try to do, and what will the CPUC let them do!

Things outside of our control - CPUC & Utilities

If you follow this blog you will know that the solar industry is under constant assault from efforts by utilities – particularly the investor-owned utilities like SCE – to reduce if not altogether eliminate the economic value of adding solar.  Whether it is by lobbying for changes to the net metering rules (which just this past year imposed additional fees, charges, and mandated time-of-use rates), or designing utility rates that make solar production less valuable, there is a constant struggle behind the scenes to undermine the solar investment of thousands of California homeowners.  (And this is not at all limited to California – attacks on net metering and efforts to impose pernicious rate structures are a nationwide phenomenon.)

Things we can control - SolarCitiSuns & CALSSA

Fortunately there are a couple of entities out there that are working hard to preserve the value of going solar.  If you are a California homeowner with a solar power system, there is an organization specifically for you.  California SolarCitiSuns is perhaps a corny name, but its mission is crucial: to organize the political power of California’s thousands of citizens with solar on their homes or businesses, or anyone who wants to be part of advocating for a clean, renewable future.  If you have solar on your home or business, click here to join!   The investment that you are protecting is yours!

 And finally, solar companies, are you a member of the California Solar & Storage Association?  We are, and you should be.  Click here to join CALSSA today! 

Beyond that, rank and file solar workers – installers, designers, finance people, anyone whose livelihood depends on the solar industry – there is an action group that you can join, even if your company is not a CALSSA member!  Joining means that you will get alerts when a crucial vote is upcoming in Sacramento or San Francisco, and give you the opportunity to reach out and show your support for the industry that provides your livelihood.  It’s easy and important. Every solar worker in California – click on this link to join the CALSSA Action Network – the job you save will be your own!

So there you have it - everything you need to know about going solar – look forward to hearing from you soon!

04/11/18

  01:51:00 pm, by Jim Jenal - Founder & CEO   , 938 words  
Categories: All About Solar Power, Residential Solar, Ranting

My Electric Bill is So High! Will Solar Help?Part 2: How Do I Find Someone to Trust?

Editor’s Note: This is the second installment in our three-part series:
My Electric Bill is So High! Will Solar Help? 
You can read part one, How High is High, here.

Unless you have been living completely offline and in a cave, you are aware that there are lots of solar companies out there looking for your business.  You’ve seen them on the Web, perhaps they have called you or even knocked on your door.  You probably realize that you should do your homework and get several quotes before going forward, but how do you even know where to look?  Fear not, we’ve got you covered!

Why Trust Matters

For most homeowners, purchasing a solar power system will be one of the most expensive purchases they ever make, after their home, their education, and a new car.  Moreover, a solar power system is supposed to co-exist with your home happily for the next twenty years or more.  For all of that to work out, you need to find someone you trust.  Your gut is a good gauge here – if someone makes you uncomfortable now, chances are you will be even less comfortable down the road.

Qualifications Count…

In the search for qualified contractors there are some basic qualifications, and there are more sophisticated ones.  Let’s start with the basics: is this contractor licensed?  In California it is easy to check that out, simply by going to the Contractors’ State License Board and search on their license number (it should be on the contractor’s website) or their name.  If they don’t have a valid license, run, don’t walk, away from them! 

Beyond just checking to see if they have a license, you can also check for the type of license (only A, B, C-10, and C-46 license holders are authorized to install solar), whether there are any public complaints against them, and the status of their bonding and workers compensation insurance.

NABCEP logo

That covers the basics, but how about something more substantive?  After all, you could hold any of the necessary licenses and never have worked on a solar power system in your life! Toward that end, there is no greater indication of qualifications than to be a Certified PV Installation Professional by the North American Board of Certified Energy Practitioners (NABCEP), a distinction I’ve been honored to hold since 2010.

How select are NABCEP Certified PV Installation Professionals?  According to CALSSA, there are some 86,000 solar workers in California, of which just 294 hold that NABCEP Certification, according to the NABCEP website. 

As NABCEP puts it:

When you hire a contractor with NABCEP Certified Installers leading the crew, you can be confident that you are getting the job done by solar professionals who have the “know-how” that you need.
They are part of a select group of professionals who have distinguished themselves by being awarded NABCEP Certified Installer credentials.

You can search for a Certified PV Installation Professional on the NABCEP website here.

So does Reputation

People love Run on Sun on Yelp

If checking qualifications matters when it comes to finding a contractor that you can trust, then so to does assessing their reputation, which these days is easier than ever to do.  Search sites, like Google, display reviews for local businesses (keep in mind the top few listings are paid ads), and major review sites, like Yelp, will let you see lots of reviews of solar contractors “near” you.  (Near in scare quotes because often those companies are saying they will serve your area even if they are located far away.) 

More localized resources, like Nextdoor and Neighbor-2-Neighbor, provide a more cultivated collection of contractors from which you can choose.

Of course, nothing beats getting a recommendation from someone you trust who has gone solar, had a great experience, and their system has lived up to expectations.  If you don’t know anyone like that, you should ask your prospective contractors for a list of clients that you can contact.  Naturally, the contractor is going to list people who will tell you great things, but ask to come by and see the installation for yourself. 

Other factors to consider…

Years in Business

Companies that have been in business a long time may or may not do better work than a relative newcomer, but at least they have shown that they know how to remain in business.  (In the solar industry, that is not a small accomplishment.)   Older companies usually have more experience – although a newer company could compensate by hiring well-experienced people – and experience is important since every project presents its own, unique challenges.

Local vs National

National companies are sometimes perceived as having an advantage because they have the whole “economy of scale” thing going for them.  Yet often those “savings” aren’t going to the consumer, they are going to shareholders or venture capitalists who have funded the operation. 

Local companies, on the other hand, live or die on their reputation.  They can’t simply write-off a territory and expand somewhere else – if they fail locally, they are doomed.  So local companies often provide much better service to their clients.  On top of that, the money you spend on a local company helps support your own, local economy.  And hey, if you have a problem, you may well bump into your installer in the grocery store and you can tell her all about it!

Next Steps…

Ok - by now you know that your home is a good solar candidate, and you have found several trustworthy contractors.  Now all you need to do is look over their bids, choose the best one, and off you go!  But wait, how do choose the best bid?  Fear not, dear reader, that is coming in Part 3: Evaluating Competing Solar Proposals

04/06/18

  01:09:00 pm, by Sara Pavey   , 1015 words  
Categories: Residential Solar, Ranting

Do "Boob" Ads Sell Solar?

[Editor’s Note: Run on Sun’s Project Coordinator, Sara Pavey, takes on a disturbing trend in solar advertising, and she does so with passion.  Warning: May be NSFW!]

 Would you buy leads from these people?

The ad above was trying to sell us leads.  Mind you, Run on Sun does not now, and never has purchased leads, but for some reason all of my online searching was dominated by these ads.

That’s bad enough, but this ad on the left from Twitter is trying to suck you in, dear reader. They want you to become one of the excellent leads that they will attempt to sell to a bunch of installers. Well, dearest neighbor whom we adore, you ARE excellent, but please don’t give them your information.  (If you want to consider solar but not scatter your contact information to all corners of the web, you can contact us here.)

But this stupid ad begs a host of questions:

  • What is she carrying? A remote survival power kit? I found it online. It looks neat. You might use it for camping. This has NOTHING to do with residential solar. This would be like using an image of a propane camping stove to market Wolf gas ranges.

  • It comes across as though it’s going to talk trash about solar, and reads like the clickbait links that say, “one simple trick to lose weight / pay off your mortgage / pay off your loans” and you know those are super shady. (I hope you know those are super shady.) Are they really trying to get people on board who are total suckers for every bit of clickbait? I’m embarrassed that people might see this who know that I work in the solar industry.

  • If you see this ad on Twitter (as I do several times a day), and read the comments, most of the attention it’s getting is about the woman in the photo. Very little is said about the odd panel kit she is carrying. Much is said about her appearance, including the hope that she is the installer or the sales rep. “Oh Sara, you can just block them.” To me, that sounds a lot like “just ignore them” in reference to other things that we have collectively decided are no longer acceptable. So I am not going to “just block them.”

Now, it’s all fine and dandy to suggest that you steer clear of these ads. But my bigger issue with this ad is that they are using BOOBS to generate leads that will ultimately send a sales rep to a home. Is the solar company’s appointment setter going to get the creeper question, “Was that you in the ad? Huh huh huh?” Is that sales rep assigned to this lead going to be a woman who gets to go meet with a potential new client who was first drawn in by a terrible ad? Is this the type of ad that is going to win over the marketing director at a solar company? Does HR want their reps going solo to homes when the leads came from a creepy irrelevant boob ad? I have my doubts about the quality of leads coming from boobs carrying a heavy box with a tiny solar panel kit, but what do I know about marketing?

What I do know, as a woman in a technical industry, is that even in our sunny egalitarian utopian solar industry, there are more men than women, there are plenty of skeevs and pervs, and there is still a lot of work to be done before Solar can claim that it’s not a sexist industry. Make no mistake, it’s better than a lot of other industries. But we can do better.

In case you’re curious about the fine quality of humans who noticed the Twitter ad, here is an abridged micro-sample of typical responses. Decide for yourself how effective this ad campaign is:

 

What company in their right mind, wants to have these sorts of comments  generated by an ad they are sponsoring?

As a woman who meets with potential clients, I have zero interest in meeting with people who came to us because they clicked on the boobs link.

The number of women in the industry is growing rapidly. At last count, women made up 27% of the workforce. Plenty of women are going solo to sales calls with homeowners who may be total dirtbags and are only interested in the boobs.

Most of the people who takes calls at your local solar company are women – and we just looove it when the caller, a potential client, has feedback on how pretty we must be because of the sound of our voice. Many of the people in marketing, rebate processing, interconnection processing, design, project management, finance, and HR are women. We don’t have lingerie-clad boothbabes (anymore) and we don’t need boobs to sell solar. Solar is cool enough to stand on its own.

When the industry is using boobs to sell a product, and a quarter of the people in the industry are objectified by the ads, there is a problem. Using boobs to sell something is nothing new, but I wonder how often they appear in other product marketing in industries where women are alone with potential clients? How many realtors depend on photos of boobs in front of a home to sell that house? How many doctors have a photo of boobs in their exam room to drive new patient business? How many dentists have ads showing boobs getting their teeth x-rayed? There’s a big difference between a Realtor’s glamour shot and this ad.

 Mercifully, we found plenty of people who were completely turned off by the ad:

 

There were lots more comments like this scattered in the stream.

Can anything profitable come from this sort of ad?

 
 

So, all hope is not lost for humanity, but I have my doubts about the quality of leads from an ad like this. And if I were at a company that bought leads, I would look elsewhere for those services. Or I’d let HR know that I set my team up for some unpleasant experiences.

04/04/18

  02:08:00 pm, by Jim Jenal - Founder & CEO   , 793 words  
Categories: All About Solar Power, Residential Solar, Ranting

Why does a Solar Client Choose Enphase?

Our friends over at Enphase Energy just completed their most recent survey of solar clients who chose Enphase for their PV system.  Since all of our clients for years now have benefitted from having an Enphase system installed, the insights that Enphase gleaned are pretty relevant to understanding our clients here at Run on Sun.  So what did they find out?

Enphase identified three goals for their survey: Determine how homeowners decided to go solar and choose their installer; assess the role of brand name products in the purchasing decision; and see what, if any, questions remained unanswered.  Let’s take those one at a time.

How Enphase Customers Chose Their Installer

Solar companies employ a variety of strategies for finding new clients, from door-to-door canvassing or cold calling leads, to print, radio, or TV advertising, as well as word of mouth.  Of course, all but that last avenue can be trod simply by throwing money at the problem. Hence the very high cost of acquisition that we see for some of the national chains, in some cases upwards of $3,000/client! 

How did Enphase customers choose their installer?  The results are quite interesting:

How did Enphase customers find their installer?

Now that is interesting - over two-thirds of Enphase customers found their installer either by referrals or from doing their own Internet research!  This tracks very closely with our own experience: we don’t purchase leads, we don’t cold-call people, and we don’t go knocking on their doors.  We do devote a lot of energy to having a quality Internet presence (via both our website and this blog), and a significant percentage of our new clients are referrals from our earlier ones.  It looks like we are meeting Enphase customer where they are looking!

It is interesting to see that third result - “My installer found me” - clearly represents all of those things we don’t do!  So that explains why you are still getting dozens of calls and knocks on your door asking you to go solar – for 1 in 5 customers that approach works, at least when it comes to signing on the line that is dotted!  (Actually, we use a solid line, but that’s an issue for another post!)

Oh, and those other forms of advertising?  Looks pretty much like money down the drain – ouch!

The Importance of Product Branding

So now we know how these Enphase customers found installers to consider, but how did they make their purchase decision?  Survey says:

What was your purchase process like?

Not surprisingly, the installer’s reputation was the most important factor, cited by nearly half of all respondents – which dovetails nicely with choosing the installer based on referrals.  

At roughly 30% each, the brand name of the solar panel, and the inverter was important in the decision.  This is interesting to me, and consistent with our experience.  Maybe one client in three has a strong view on either the panel or the inverter when we first speak with them.  Of course, that means LG and Enphase because that is all that we install.   I suspect if you were to look at this question five years ago, the number of respondents saying brand was important to them would have been much smaller.

Oh, and again, the survey shows that we are missing out on one in five potential clients since their installer offered a variety of products from which to choose.  In our view that is something of an abdication of our responsibility as pros.  Our clients want to rely upon our expertise to guide them to the right choice – how are they supposed to know what it the best inverter or solar panel out there?

Questions, questions!

An important part of the installation process is to manage client expectations, and a key component of that is to answer their questions.  So how good a job are installers doing at answering those questions?  Survey says:

Answering client questions

The overwhelming number of Enphase installers are answering their clients questions – good job!  But interestingly, about one in five clients are being left in the dark about questions that they had regarding their systems.  (I wonder if this is the same one in five who had the installer find them?)

For folks who have questions, what is it that they most want to know?  Again, these open questions reflect on the need to manage expectations:

questions about new solar projects

Not surprisingly, the number one question, asked by a 60% of respondents, is how does the production from the solar system relate to their electric bill!  This is an extremely common concern – leading to that famous complaint: I’ve got solar, why is my bill so high?  I think the evidence is overwhelming that solar installers need to do a better job of explaining how these systems will work in real life.  

Are you a recent solar consumer?  How do these results match up with your experience?  We would love to hear your thoughts/experiences in the comments!

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Jim Jenal is the Founder & CEO of Run on Sun, Pasadena's premier installer and integrator of top-of-the-line solar power installations.
Run on Sun also offers solar consulting services, working with consumers, utilities, and municipalities to help them make solar power affordable and reliable.

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