Purchasing a solar system is a significant investment, and for California customers, especially those under NEM 3.0 in the PG&E market, it's crucial to do thorough research and compare competitive proposals. Not all solar quotes are created equal, so here are key factors you should consider when evaluating potential solar installers in California.
kWh Production Per kW
Ensure the solar production estimates are realistic and not inflated. A good way to compare quotes is by looking at the kilowatt-hours (kWh) produced per kilowatt (kW) installed. For the PG&E territory in California, a typical solar system should produce around 1,500-1,700 kWh per kW annually, depending on orientation, tilt, and shading. If a quote claims higher production, it could be a red flag indicating inflated numbers. Trusted installers will perform a physical or virtual site assessment to provide accurate estimates.
Energy Cost Escalation Rate
Some installers may overestimate future energy cost increases to make solar systems seem more profitable. In California, electricity costs have historically increased at an average rate of about 4-6% annually. Be cautious of quotes using significantly higher rates, as this can skew your savings projections.
Retail Price of Electricity Today
Accurate savings estimates depend on knowing your current utility rate. Ensure that the installer correctly references your specific PG&E rates in their proposal. National averages may not reflect the higher rates in California, leading to overestimated savings. To calculate your average rate, take your total KWhs used and divide my your total electricity cost of your latest monthly bill. This will provide you with a cost per KWh average for your rate plan. Current PG&E residential rates can be found here.
Solar Offset Based on Utility Calendar and Energy Goals
We recommend designing your solar system to offset around 75-80% of your historical energy use. Under NEM 3.0, energy produced by your solar system is credited at a lower rate than before, so oversizing your system could result in donating excess energy back to the grid. Additionally, PG&E's net metering follows a specific annual cycle, so it’s important to consider this when estimating your solar offset.
Professional Roof and Shading Assessment
Solar production depends on factors like roof orientation, tilt, and shading. A thorough in-person or virtual site evaluation is essential to ensure accurate production estimates. Beware of companies that skip this step, as their estimates may not account for potential production losses.
Solar Production Guarantee
Ask each installer if they guarantee their production estimates. In California's sunny but varied climate, an installer should back their system's performance with a production guarantee, covering the risk if the system underperforms. This assurance indicates their confidence in the design and accuracy of their production model.
Energy Efficiency Upgrades and Solar Bundling
Some companies bundle energy efficiency services with their solar installation. While beneficial, ensure they don't inflate solar savings by including unverified efficiency upgrades in their projections. Efficiency improvements are not eligible for the 30% Federal ITC, so bundling them into the solar cost may misuse this incentive.
Transparent Pricing: Cash vs. Financing
Pricing should be straightforward. Look for clear breakdowns of cash and financing options, and beware of sudden discounts or mark-to-market tactics. The total system price should be consistent and transparent, with no hidden fees wrapped into monthly payments.
Clear Model Names and Reputable Manufacturers
Ensure the proposal clearly states the panel model and manufacturer. California's climate demands durable, high-efficiency solar panels with warranties typically around 25 years. Choosing reputable manufacturers is crucial for long-term support.
Certificate of Insurance
Make sure the contractor and their subcontractors are insured. Ask for a Certificate of Insurance (COI) to verify coverage. Working with a fully insured installer protects you from potential liabilities, such as worker injuries or property damage during installation.
Key Takeaways for California Solar Buyers:
- Ensure product specifications, services, warranties, and pricing are transparent.
- Request a physical or virtual site assessment for accurate production estimates.
- Align your system size with energy needs, typically aiming for a 75-80% offset.
- Confirm that the installer is well-established in the California market and understands local regulations like NEM 3.0.
- Verify the installer and their subcontractors are insured to protect yourself.
By keeping these points in mind, you’ll be better equipped to make an informed decision and maximize the benefits of your solar investment under California's unique NEM 3.0 rules.
Chris Mink is Sales Manager at Sun Light & Power