There was big news in the solar installations world earlier this month. President Obama revealed his Clean Power Plan to the nation, and it was good news for homeowners and solar energy businesses.
Starting in 2022, states would be required to start slashing carbon emissions to hit an ambitious target for solar energy usage by 2030 — carbon emissions that are 32% below 2005 levels.
Energy experts have said they think the country will be able to hit that goal — thanks to increasing renewable energy affordability and government incentives for American homeowners.
But what does the Clean Power Plan mean for the solar energy business? With big changes like this, there’s usually an opportunity if you know where to look. For you, that means solar installations, which are going to skyrocket in the next few years as installation costs come down, energy savings are realized, and government incentives start to kick in. Here’s how.
Installation Costs Are Falling; Solar Popularity Is Growing
Solar installation costs have been falling over the last few years — a lot. Since 2010, prices are down about 50%. Experts say we can expect a further drop in installation cost, an additional 40% by 2017 according to Deutsche Bank, as more customers become solar energy users.
But wait — Is falling installation costs a good thing for business?
It is if you want more of it.
The Solar Energies Industry Association (SEIA) says a new solar installation project was finished every 2.5 minutes in 2014! A Bloomberg energy forecast predicts $3.7 trillion will have been invested in solar by 2040!
Solar sales are already growing at an exponential rate. The SEIA says the industry grew by 34% in 2014 while the latest numbers say market growth is up 76% for the first quarter of 2015. The growth over the next few years is expected to catapult to even higher levels, with 50,000 megawatts coming online by 2020.
Incentives for Homeowners, Opportunity to You
Homeowners are certainly incentivized by falling installation costs, but it’s existing subsidies, plus Obama’s new plan, that’s driving the current exponential growth.
Subsidies are largely decided on a state-by-state basis as is. Experts say under Obama’s proposed plan, that’s going to continue.
Currently, the biggest market share increases are following those subsidies. States such as California, Colorado, Minnesota, Oregon, Texas, and Washington already boast over 100 policies and incentives each for renewable and clean energy. These are the states where solar installations are already booming. But states like Florida, Massachusetts, New York, and North Carolina are catching up. Things are moving at a slower pace in places like Kansas and West Virginia, but that could change if Obama’s new plan becomes law.
States would have until 2018 to submit their plans for reaching targets, but it’s likely many states will opt for a subsidy program for residential homes that invest in solar. The idea being that those states can count those homeowners’ emission reductions toward their Clean Power Plan targets.
With all the growth that’s expected, I bet you’re wondering how to get your slice of the pie. The fact is, there’s opportunity in almost every state. Some markets are more mature than others, but all are expected to take off in the coming years.
If you haven’t already, take a look at the Database of State Incentives for Renewables and Efficiency as well as these 28 other federal-level programs. These are programs already up and running that could help you grow your customer base.
Many solar installers will be focused on the residential market and there’s certainly money to be made here. Residential costs have dropped about 45% over the last five years, with installations costing between $10,000 and $25,000 in popular markets. However, those customers stand to save an average of $20,000 to $40,000 over the next 20 years. These are great selling points to educate potential residential customers on. But solar isn’t just for residential anymore.
Utility-scale costs have dropped even more since 2010, with contract costs below $0.05/kWh. Commercial solar is one option to explore, but there are others, too.
Don’t Rule Out Other Opportunities
Customers are motivated to move to solar energy by two big factors:
- Initial affordability
- Long-term cost savings
As more and more customers — both residential and utility-scale — sign up, they’re realizing the long-term savings.
Critics have said low-income families may have difficulty making the switch to solar under Obama’s proposed plan. But it’s worth remembering that, besides residential subsidies, nonprofit and governmental programs, like the Community Solar Partnership, may help those Americans come online with solar.
The opportunity is clear for solar installations — nonprofit and government entities will also need solar installations for their operations as renewable energy goes mainstream. Businesses that can take advantage of these kinds of opportunities are going to do very well.
If your business is solar installation, you’re going to do very well over the next few years. The cost to get on board with solar is falling every day, while the popularity of renewable solar energy is going through the roof and Obama’s Clean Power Plan could be the match that really sets things off.
To take advantage of this opportunity, keep on top of the latest stats and government subsidy programs. These are going to be your best tools to win over your customers and help them realize their solar energy aspirations.
Last but not least, if you’re looking for quality, affordable solar installation leads for your business, check out the AgedLeadStore.