New Construction Makes for the Most Financially Compelling Solar Installation Leads Solar installations can bring savings no matter where they’re built. However, a changing policy climate and a new report from BloombergNEF and Schneider Electric point to new construction as holding the most potential for economic gains - for both the end user and the contractor.
We review the factors affecting the affordability of new construction installations below.
Mitigating Needs and Expenses Schneider Electric and Bloomberg NEF have found that installing solar systems while buildings are being constructed is considerably less cost-intensive than retrofitting. The report estimates an average cost drop from $22,000 to $12,700.
Much of this is attributed to the reduction of soft costs such as marketing and permitting. Collaborating with builders gives solar installers extra support and cuts out a lot of the procedures that would normally need to take place when nurturing a sale with the homeowner. These soft costs can make up 51% ($1.39/W) ofthe final residential solar price and 39% ($0.6/W) of final commercial solar price.
In addition to soft costs, contractors can also save on labor and equipment during the installation process. The report uses scaffolding as an example, citing that contractors can make use of that which has already been provided and erected by the roofing crew.
Contractor savings seen via these shortcuts are able to be passed on to the homeowner. Developers can afford to lower the price of real
estate to enhance their competitiveness in the market. Once the resident is inhabiting the new home and utilizing the solar system, they will be able to see further savings via energy bill credits. The internal rate of return seen on solar in new construction can thus be much higher. In California, for instance, solar on existing residences generates a 20% IRR. The report, however, measures a doubling in the case of installations performed during the building process, putting the IRR at 40%.
Policy Mandates are Generating More Demand New construction’s economic benefits are not limited to their affordability. They also include the growth of solar installation leads. Housing shortages throughout the country are creating more pressure to develop homes, opening up new opportunities for solar installations.
Furthermore, policies like California’s mandate that all new construction be outfitted with solar drive up market demand. With a number of other
states looking to pass such laws, many more contractors can expect to see sales rise with the building of new homes. It is expected that this type of legislation will be introduced by mid-2022 in Nevada, Colorado, New Mexico, Texas, Minnesota, Michigan, North Carolina, Maryland, Pennsylvania, and Massachusetts. Contractors who need to boost their sales now can see the best results by forging partnerships with local builders, as well as a reputable solar marketing company like Grid Freedom. The latter can deliver booked appointments with leads that have been qualified via live phone calls with agents trained to spot the best residential solar customers. Only leads that are fully prepared to go solar make the cut, giving contractors a smooth path to sale conversion. Find Solar Installation www.GridFreedom.com
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