SOLAR SAVINGS BLOG

ROOFTOP SOLAR IS STALLING: WE MUST CROSS THE CHASM

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20-Sep-2016

ROOFTOP SOLAR IS STALLING: WE MUST CROSS THE CHASM

Bloomberg New Energy Finance has recently issued a bleak forecast for the growth of rooftop solar in 2017. Their prediction is that growth will slow to a paltry .3%, as compared to 21% in 2016. Many solar companies have already witnessed a slowdown in their businesses, as well as intensifying competition for a dwindling pool of potential customers. As a result, industry leaders like Solar City, Sunrun, and Vivint have become more focused on profitability rather than growth.


So why isn’t rooftop solar growing? With solar penetration of less than 10% of all solar-suitable homes in California, the market should have ample room for many years of robust growth. But let’s take a look at where rooftop solar is on innovation adoption lifecycle curve. We have to cross what Geoffrey Moore calls "crossing the chasm" in order for rooftop solar to start growing again.


With 10% penetration in California, you can see that we have pretty much tapped out all the Innovators and most of the Early Adopters. The industry needs to shift from using sales tactics that worked when selling to Innovators and Early Adopters, because these groups didn’t need very many reasons to sign up for solar. The Early Majority however, are not easily swayed by “green” reasons to go solar, and will need hard evidence to back up their decisions to make a solar investment. We as an industry have not done a good job providing such evidence. In fact, our industry is plagued by companies that are not careful with sizing calculations, which results in many homeowners not seeing very good financial results.


We've asked hundreds of existing solar homeowners if they knew how much they were saving, and over 80% said they were unsure. That's not the kind of response we need to spur word-of-mouth marketing to drive organic growth.  


It’s not to say that solar isn’t economical. In the majority of cases I’ve seen, the economics vary from very good to marginally better than staying with the utility. And it makes the homeowner’s future electricity costs much more predicable, rather than being subject to periodic rate increases from the utility. But very few of these homeowners can definitively say where they stand. In fact, many of those homeowners who proudly explain how their utility bill was eliminated, quickly retreat once they realize that they were sold an oversized system, and that had actually been sending electricity back to the grid for free. 


We need to make it easier for homeowners to maximize the return on their solar investment, and to be able to easily track its performance over time. This means switching to the best rate plan that will maximize savings, based on household energy consumption and solar production patterns. It also means not installing too much solar so that the excess is exported to the utility at a loss.

HOW TO CROSS THE CHASM


The Prius rapidly grew in popularity once Toyota installed a graphical readout that instantly tells the driver how efficiently they were driving, creating a phenomenon known as the "Prius Effect." Drivers became hooked on this visual feedback, which made them love their cars and play around with different driving modes to see how efficiently they could consume a gallon of gasoline. Homeowners haven't had a similar graphical readout for their solar financial performance (we're changing that!), which we believe would convert many of them into raving fans of their solar. And solar production monitoring systems only tell you half of the story -- you’d need to add in the home’s consumption data and then solve for the optimal rate plan to get the true financial picture.


Solar homeowners need an easy way to validate the financial performance of their solar investments.  If they knew how well their (properly optimized) solar was actually performing, I believe they'd help us cross the chasm to bring in the Early Majority, simply because they couldn’t help but spread the word about how well their solar is performing.


We have built and fine-tuned our solar performance measuring technology over the past three years, and have recently launched in southern California.  Contact us if you'd like to learn more about how we can make your customers happier with their solar, which should encourage them to send you more referral business. 

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