Solar Warranties and Contractors

Whats covered and who's responsible?

As a consumer, how many 25 year warranties have you been offered?  Probably none!  So why are there so many 25 year warranties in solar and what do they really cover?

Many solar manufacturers offer 25 year warranties.  However, don't be misled by the 25 years.

I will walk through a few scenarios to give you a basic idea of what is being offered.

Solar Edge optimizers and inverters.  Example coverage.

Solar Edge is a leading manufacturer of optimizers and inverters in the world.  The optimizers work maximizing each solar panels production, reduces power losses from shading, and offer the ability to see each individual panels performance at all times.

They also utilize a central inverter that converts DC to AC and is typically located near your service panel.

They offer a 12 year warranty on the inverters and this includes labor as well as materials.  However the materials are pro rated.  This means if their inverter fails at year 11, they deduct the use you received for those years and allot you 1/12 of the actual replacement for just the invereter.

The optimizers are a 25 year warranty with the same process for depreciation as their inverters.  In all fairness the depreciation states "at solar edge's" discretion.  But a few years from now and some inflation will probably dictate their "discretion" option.

They also will upgrade the inverter warranty to 25 years for an additional fee of approximately $300 for each inverter.

Although labor is included, there are some Very Important nueances that you need to be aware of.

Solar Edge will repair or replace their products with refurbished/new units at their discretion. This is fine as some products may not be available in the future and refurbished units may be all that is available.

Labor is another issue altogether and is the major portion of any warranty.

There is no labor included with your new solar edge system in and by itself.  The labor is a "reimbursement" to the contractor.  The rate of reimbursement is dictated by Solar Edge.
Currently, most contractors are honoring solar edge's reimbursement rates.

However, these reimbursement rates will not cover the actual labor costs associated with rolling out a truck with typically two employees needed to perform the repair.

They also make the contractor call in the warranty request while on the job.  It is typical to be on the phone for between one and three hours waiting for approval before work can commence.

This is not an issue if you have a few thousand units installed and 1% failure is realized.  But when you get over 100,000 units, everything changes.  Contractors could go from one repair crew to four crews real easy.  If current rates are not covering costs, a consumer could only imagine the financial losses by the contractor 15-25 years later.  Don't expect contractors to honor the manufacturers labor warranty down the road.  They just won't be able to afford it.

THIS LABOR WARRANTY IS ONLY ISSUED TO THE INSTALLING CONTRACTOR!

So if your contractor goes out of business or just refuses to honor the labor reimbursement rates, you the consumer has No Recourse on collecting on your 25 year labor warranty.

Keep in mind that the consumer does not have a direct labor warranty from Solar Edge to do the work outside of the installing contractor and solar edge does not have a contract with installers to honor their reimbursement rates.  

Most consumers would never think this is how the warranty works so would naturally not think to ask for the contract to include a clause that all reimbursement labor rates from manufacturers be honored by the contractor for a period of 5 to 10 years.  Keep in mind that all labor warranties offered by solar contractors are for their workmanship only unless otherwise stated.

Now lets toss in the 800 lb Gorilla to the equation.

  What if the contractor has left the area and is still in business.  You call to get service on an optimizer or inverter.  And lets assume for a minute that he has properly installed the original unit.  If he refuses to do the work at all, and you hire someone else and pay them directly, the original contractors warranty is typically null and void.  Also, the homeowner will not be reimbursed by Solar Edge being the "installing contractor" did not accept Solar Edges reimbursement rate or do the repair! You must pay for the labor portion of the warranty.

Sounds bad, but I am predicting these scenarios will occur. 

I am not trying to pick on Solar Edge.  They make great products and we have installed many tens of thousands of units but this is how we have found their warranties to work.

The above listed scenario is not unique to solar edge.  Enphase has a whopping two year labor warranty from the manufacturer.
Still, a 25 year warranty was advertised and believed by customers to actually cover their products for 25 years.

We have an agreement from Panasonic to wrap Enphase with the Panasonic 25 year warranty.

What this warranty does is include the labor and warranty of enphase for both labor and material for a full 25 year warranty like the Panasonic solar panel warranty.

This program is for the authorized "Premium" installers.  The Enphase units must be installed and tested by Panasonic at their New York facility.

 This is a great option for customers interested in adequate solar warranties.  So options for better warranty coverage are available but not all contractors have these offers for a variety of reasons.

 To overcome the inadequacies of solar manufacturers warranties we have developed the Beyond Power Warranty that includes everything from materials, labor, vandalism, fire, hail, etc for a period of ten years.  This is proprietary to Nova West Solar.  We can only offer it on the premium product lines that we have had an excellent track record of warranty coverage being honored.  This warranty is an additional cost to this warranty.

Again, I am using Solar Edge as an example, but they are not the only manufacturer to operate this way.

Tier 1 solar panels:  Some solar panels have been impossible to get any warranty coverage on at all and we have paid to purchase and install failing units to make customers happy.

Typically we have done this on units that fail when we initially installed the job.

25 years is just too long to reasonably expect warranty coverage on.  Warranties, in my opinion, seem to be written to give the manufacturer a "way out" of future customer claims.

If warranty coverage terms seem to good to be true they may be too good to be true.

Locally Owned and Operated Contractors

Does Buying Local Matter?

 Local contractors are typically not as large volume wise and do not have the resources to adequately market their services to the same degree as multi city contractors.  However, they bring other benefits to the table.

a. Utilizing local employees

b. Utilizing local vendors

c. Utilizing local trucking

d. Spending revenues locally like taxes, home ownership, schools, clothing, food, etc. by not only the business but all the employees of above mentioned businesses.  

e. Designing systems that can easily and inexpensively be added on to. This makes for very happy customers at a later date.  Especially when they decide to purchase an electric vehicle and want a plug and go option on their existing solar system.  

f. Ability to service customers same or next day.

g. Easier to manage and control quality.

h. Local sales people that can help you before, during, and after the sale.

  

Keeping business local benefits your community, not the community hours away from home.

A few out of town contractors that have been a household name in Fresno in years past are:

Akeena,       Vivint,       Verango,       Solar City,       Rec,    Unlimited,    Solar Universe,       GCI,       Enver,       Sungevity,       Sun Edison 

just to mention a few. 

In 2019, all these contractors have  left the area or are  no longer in business!

Typically, no office is more profitable than the one where the owner(s) are located at.

Lack of profitability is the driving force of an out of town contractor leaving your area, even though they may not go out of business at their home location.

Owning multiple solar operations looks good on paper, but the reality is it is sometimes hard to absorb losses from multiple locations when the economy retracts.  And it always does.

Nova West Solar's only office in Fresno, but we are celebrating our 15 Yr Anniversary and will be hosting an open house at our new facility in the coming months.

Keep in mind there is No Place to go home to for the local contractor. This is home.

Local or Out of Town Contractor

Out of Town Contractors

Choosing a contractor to build your new solar system is always a tough decision.  Out of town contractors typically offer the following:

a.  Being "larger" than most of the local companies.
b.  A longer tract record of customer service as well as more installs.
c.  Higher online presence with social media and consumer advocacy groups.

All of these things can help consumers to believe that these out of town businesses offer a better as well as safer option in going solar.

On first appearances, they may seem larger and more financially secure than their local counterparts.

Things to consider are:

a.  Where is their home base location.  You may be surprised to see them a minimum of 4 hours away and sometimes out of state.

b.  Do they use their own crews or do they subcontract their installations?  An easy way to find out is to ask if the building permit is in that companies name or the subcontractors name.

c.  What are the warranties for labor.  This would include not only their workmanship but also any labor paid for by manufacturers to repair or replace their products.

Will they put in writing on their contract that they will "honor" the labor reimbursement rate from the manufacturers for a period of 10 years? Ten years is a long time to guarantee labor for any product line.  Also, most systems are paid for two times over by the end of ten years.

d.  What we have realized in the Fresno market is the average time a large "non local" solar company remains in the marketplace is 3 years.  Notable losses to the solar residents of Fresno include

Solar City, Akeena, Peterson Dean, REC, Vivent, Virango, Solar Universe and the list goes on.

e.  Nova West Solar is approaching its 18th year in business consecutively!  We do not work on other solar contractors jobs that have been abandoned by those contractors due to exclusions in our liability insurance policy.  

A lot of consumers have been pleased with their out of town contractor and solar system.  Other customers have realized that getting service and warranty work covered is not always so easy.

Whats the best way to finance Solar? Leases, PPA's, or Solar Loans

PPA"s (Power Purchase Agreements) and Leases

PPA’s “Power Purchase Agreements” are very similar to a solar lease.  A lease provides a solar system to a customer with repayment in the form of a monthly payment.  Some payments escalate and are not a good way to go.  Always pick a fixed payment.

PPA’s sell you the energy they produce at a lower price than the utility company does. 

Both products are typically 20-25 yrs right now.

Both require a “buy out” at the end of the program.

Sales people have been told to tell customers that at the end of 20-25 years the solar system is worth nothing and their company will take what ever they can get.  $1,000 is a number that is thrown around a lot in the past by sales people.

However, the buyout requires an appraisal at the end or the ppa or lease term.  Unlike a 25 year old paint job or roof, the solar will be appraised based on a cash flow basis.

This means that the money it generates at that time is directly tied to the appraisal and thus the buyout.

In talking with the key mathematicians for leasing companies at private events at solar conventions two different leasing gurus informed me that the buyout would in essence equate to 32% of the sales price of a new system at that time.  When I asked why 32% I was told that is a price point where a customer will write a check versus putting on a new system.

However, that is not the goal of the buyout.  The buyout will be high enough that these private investors want to re-sign their customers for (2) more five year terms. 

So you will have financed your solar at a much higher rate than just refinancing your home loan and including the solar into it today.

Also, the PPA or lease requires all monies from payments be paid if a buyout occurs.  This means if a customers payments amount to $40,000 over 20 years, and this same customer must sell in two years, They owe the entire $40,000.  Unlike a loan where the principle amount of say $20,000 would need to be paid off.  Big difference.

Now the crowning jewel customers aren’t told.  If you think you can just let someone take over your payments, think again.  Call a couple of real estate brokers and they will tell you buyers do not want the leases and PPA’s.  Worst yet, the lenders don’t like them as it is looked at as debt and the debt to income ratios lower the amount of home people are allowed to buy.

The bottom line with buyers is they can put a new system on, take the tax credits, and it is much cheaper than “taking over” solar payments over a long finance term.

This has meant that sellers have had to pay off the entire PPA plus buyout with equity in their home.

If they don’t have enough equity then it must come out of savings.  And if that isn’t an option then they can not sell their home.  Realtors, due to disclosure laws and for liability purposes have to disclose information on leases that is very unattractive to new buyers.  Realtors hate PPA’s and leases because it costs them being able to sell a home and make their commission.

Lets look at financing options for a solar purchase for people that do not have use for the tax credit.  Good news is it can be rolled over for 5 years. 

Ownership is always better than leasing.  In 15-20 years you own your power, no buyout, and added value to your home due to the new buyers lowering the cost of energy and being able to easily finance it in with the home.  Much different than a PPA or Solar Lease.

How To Buy and Barbecue a Perfect Steak

Buy Carefully

The United States Department of Agriculture inspects the nation's beef supply and grades it according to tenderness, texture, and "marbling," a term that refers to the distribution of intramuscular fat. (Remember this equation: Fat = Flavor.) There are eight USDA grades, but only two -- "Prime" and "Choice" -- are of interest to steak lovers.

Only about 2 percent of U.S. beef is graded "Prime." Most is exported or sold directly to restaurants, but it can be found at specialty meat markets or through high-end Internet purveyors like Allen Brothers or Lobel's. "Choice" is the grade generally carried by supermarkets, and because the guidelines for classifying meat are fairly subjective, it can be as good as "Prime," in some cases. I often buy "Choice." Note: Costco and Sams Club sells prime for $11 per lb.

I advise you to make good friends with your butcher, and have him or her notify you when they have especially nice steaks on hand. Tender, generously-marbled cuts-I always prefer bone-in if that's an option-are best suited to the high, dry heat of the grill.

Good candidates include:

T-bone: This is a happy marriage of a New York strip steak and beef tenderloin;

Porterhouse: Like a T-bone, this cut contains the bone joining the top loin and the tenderloin, but the tenderloin must be more than 1-1/4 inches in diameter;

New York strip: Sometimes known as a shell or club steak, this cut is taken from the top loin;

Rib eye steak: very beefy and one of the most flavorful cuts. This same cut without the bone is known as a Delmonico steak;

Tenderloin: one of the tenderest cuts of beef, but the least flavorful. (Muscles that are used the least develop the least flavor.) Individual cuts from this muscle are known in restaurants as filet mignon, or if they are large enough to serve two or more, they are called Chateaubriand;

Sirloin: Adjacent to the short loin; moderately tender, but very beefy-tasting.Other, more fibrous cuts that have become popular with grillers are flank steak, skirt steak (the traditional meat for fajitas), hanger steak, and flat-iron steak.

Here are two other terms steak lovers should know:

Wet Aging: Meat is vacuum-sealed in its own juices in plastic, such as Cryovac, and kept under controlled conditions until natural enzymes tenderize it from within and deepen its flavor;

Dry Aging: In an environment where temperature, circulation, and humidity are scrupulously controlled, meat is held for two to three weeks. Again, enzymes tenderize the meat and deepen the flavor, but because the raw meat's exposed to air, dessicated parts have to be trimmed off; this makes dry-aged steaks more expensive as approximately 20 per cent of the meat goes to waste. Dry-aged steak is my hands-down favorite.

Barbecue Tips
1. Never thaw meat out at room temperature. Allow to thaw in refridgerator. This allows the meat to thaw slowly while retaining the natural juices essential for great flavor. Smaller items such as steaks, chops, chickens, etc will usually thaw overnight or within one day in your refrigerator. Larger items such as roasts may take a few days to fully thaw in your refrigerator.

2. Don’t be afraid to NOT season steaks with salts prior to barbecuing. Salts dry out meat during cooking. Personal preference should be utilized. If you prefer to season, here is my suggestion. Fill a small container with coarse kosher salt, black pepper, and garlic. Then, sprinkle over the meat to suit your taste.

3. Sear the meat on each side first. Searing traps flavors and juices in.

4. REDUCE HEAT during the barbecuing process. This allows the meat to cook slower and produces a more moist and flavorful taste.
Do not immediately serve. Allow meat to cool down for several minutes. The high heat from the barbecue allows for shorter cooking time, but it also drives the meats natural juices to the center of the cut. By allowing the meat to rest, you are allowing the juices to redistribute themselves throughout the meat.

Beef Steaks .....Gourmet .....USDA
Rare................... 125-130 F.. 140 F
Medium Rare ....130-140 F ..150 F
Medium .............140-150 F.. 160 F
Medium Well ....155-165 F ..170 F
Well Done NA

What to Expect From a Solar Sales Person

Solar Sales People and You

In one of our earlier blogs, we discussed solar sizing. A professional solar salesman should go over those items to help you evaluate your needs so a solar system can be sized and priced accordingly.

Questions to ask yourself are

1. Do you like the person you are dealing with? What is their attitude toward your hard earned after tax dollars you will be using to purchase solar.

2. Do they listen and acknowledge your interests and concerns?

3. Do they answer those concerns or do they shelf those issues and just go on to their next presentation points?

4. Do they offer multiple products and do they push their company’s predetermined product line.

5. Do they educate you as to the different silicon manufacturing processes as well as the benefits and differences of each?

6. Do they try to determine less expensive ways to offset your energy needs?

7. Sales People should know the differences between string inverters, optimizers, and micro inverters.
Are they knowledgeable on the differences in Warranties.

Most consumers are not fully aware of the most primary and "expensive" portion of any warranty is the Labor.  Enphase Micro inverters have a 25 yr warranty but just a two year labor warranty.  However, if a Premier Panasonic dealer purchase enphase micro inverters installed at the Panasonic plant in New York, Panasonic will wrap the Enphase warranty with the Panasonic 25 yr labor warranty.

What this means is Panasonic would offer 25 years of labor for the enphase units!  As you can see, an informed sales person can be worth their weight in gold if they educate a consumer of what the various warranties actually cover.

8. Do they discuss the different warranties, efficiencies, pricing, and value utilizing different product lines? A customer who has a very limited roof area and wants to get rid of as much of their bill as possible may want to consider Panasonic, Q Cells, or Canadian Solar 60 cell high efficiency panels.

Solar sales people are the gateway to the solar industry. Very little happens without them. The best value for purchasing solar power is when all of the above items are considered when purchasing a solar system for your home.

Just by asking some of these questions can clue you in to whether the sales person and contractor have your best interests at heart.

SolarEdge DC Optimized Inverters and Telsea

SolarEdge will be supplying an inverter system that will enable photovoltaic (PV) and grid integration with Tesla’s recently announced Powerwall home battery – a storage pack capable of supplying electricity for homes when the sun goes down. Combining their technologies, the partners said they are building upon SolarEdge’s DC-optimized inverter solution and Tesla’s automotive-grade energy-storage technology to provide a more economical solution for residential solar generation.

“Tesla’s collaboration with SolarEdge unites leading organizations in two rapidly growing industries, solar energy and energy storage, to bring homeowners a more cost-effective and integrated energy generation, storage and consumption solution,” Tesla CTO J.B. Straubel said. “SolarEdge’s commitment to improving the value of PV systems through product innovation, combined with more than 1.3 gigawatts of successful deployments, makes it an ideal partner for Tesla to develop and introduce this new energy-storage solution to the PV market.”

Tesla, which has dazzled the electric-car market with its fastcharge car batteries, announced its new wall-mounted rechargeable battery last week.

The Powerwall will be available in a 7-kilowatt-hours daily cycle version for everyday use and for backup in the event of a power failure or disaster. This inverter system is priced at $3,500.

The battery is designed to collect solar energy accumulated daytime hours and use it to power the home in the evening and morning, when electricity usage is highest but sunlight is lacking.

“We have this handy fusion reactor in the sky called the sun. You don’t have to do anything – it just works. It shows up everyday and produces ridiculous amounts of power,” Tesla CEO Elon Musk said at last week’s launch event for Powerwall, which was fully powered by solar-charged batteries.

The batteries could potentially provide a sort of “smart grid” solution without actually needing a smart grid, according to Tesla. Although they are marketed as a solution for storing solar power, the batteries can also store electricity from the grid during less-expensive offpeak hours and then supply it to the home during the expensive peak hours when there is highest demand.