Challenges in residential solar
From 2010 to 2016, the residential solar market grew steadily year-on-year, averaging 49 percent growth over six years. In 2017, the market slowed, and installations dropped 15 percent from 2016 and 2017. Customer acquisition and education have proven to be challenging for residential solar companies, contributing to the decline.
“Despite economics that create a good value proposition for consumers in mature solar markets – like California and the Northeast – states with mature solar markets suffered the most in 2017 because companies are struggling to acquire customers cheaply. Customer fatigue in early 2017 created an environment that has become very expensive to operate in,” said Allison Mond, Senior Solar Analyst.
Many companies are now offering consumers more choices than ever with multiple financing options, including solar loans, and add-ons such as energy storage and energy efficiency upgrades, yet customer acquisition remains a struggle.
Community solar bolsters non-residential solar
The non-residential market reflects a different pattern – slower to start with peaks of growth coinciding with favorable legislation. Community solar has been a strong segment of the non-residential market, especially in recent quarters. These programs, set-up by utilities themselves or through legislation, can help commercial businesses with renewable energy targets to meet their goals without installing solar directly on their property. Although community solar programs are comprised of homeowners and businesses, commercial customers are often needed to serve a critical anchoring role in program structure.
These programs offer customers the benefit of potential savings without directly administering a PV installation. The long-term longevity and sustainability of these programs depend in part, on numerous factors, such as policy and effective program design – but also on the demands of eco-minded customers.