The residential solar industry faced significant headwinds in 2023, with many top installers losing market share amid challenging economic conditions. However, despite these obstacles, the sector still managed to grow by 12% year-over-year, installing 6.8 MWdc, although project backlog from 2002 drove much of this growth, particularly in California.

Looking ahead, installers are navigating a complex landscape of reduced net metering benefits, workforce issues, and higher financing costs. As we navigate through 2024, both challenges and opportunities await residential solar installers.

Growth Amidst Uncertainty

Despite the dark clouds, some rays of sunshine are poking through. A recent survey of residential solar companies revealed a cautiously optimistic outlook among installers. The survey found that 54% of installers expect to sell more solar in the coming year, with 35% anticipating business growth. This positive outlook is tempered by concerns, as 22% of solar businesses are unsure if they can stay afloat in the next six months.

Some of the other key takeaways from the survey include:

Net-Metering

Shifting net-metering rules continue reshaping the market. In 2023, 27% of installations occurred in areas without full-retail net metering, up from 11% in 2022. California saw a significant impact, with 69% of installers reporting lower sales after the state slashed net-metering rates. Other states like Georgia, Arizona, and Kansas also saw increases in installations not tied to net-metering agreements.

While the changes have negatively impacted sales in some regions, they also underscore the need for installers to adapt their value propositions or explore new markets where solar remains attractive even without generous net metering incentives.

Workforce Challenges

Labor challenges persist, but their nature is evolving. A lack of skilled labor has previously dominated as the main concern, but installers now point to lower work ethic and higher wage expectations as primary issues. The percentage of respondents citing a decreased desire to participate in work rose to 27% in 2024, the highest response.

Permitting Obstacles and Progress

Permitting and interconnection continue to be significant pain points for the industry, with 46% of installers agreeing that permitting rules are too complicated and 28% citing inconsistent rules between jurisdictions as a major issue. 

Although slightly less than half of respondents operate in jurisdictions using SolarAPP+, 85% of those users reported that it significantly eases the permitting process. Those installers in areas that have access to SolarAPP+ but aren’t using it should consider the option.

Fortunately, installers in California have additional hope on this front. The California Energy Commission (CES) has announced $18.9 million in grants to help communities automate residential solar permit approvals, which could significantly speed up installations and reduce costs.

Residential Solar Strategies for Success: Leveraging Advanced Technology

In this turbulent environment, n-type TOPCon modules with a 25/25 year warranty program from a highly bankable manufacturer offer several strategic advantages for installers:

1. Enhanced Performance: N-type TOPCon technology, like what’s used in Vertex S+, provides higher efficiency and better performance in low-light conditions, allowing installers to offer customers more power output from the same roof space.

2. Long-Term Reliability: A 25/25-year warranty program like TrinaProtect demonstrates confidence in the product's longevity, addressing customer concerns about long-term reliability and potentially offsetting hesitancy due to high upfront costs.

3. Bankability Assurance: Working with a highly bankable manufacturer can help installers secure better financing terms and give customers added confidence in their investment.

4. Differentiation in a Competitive Market: Offering cutting-edge technology with strong warranties can help installers stand out in a crowded market, potentially improving customer acquisition rates.

5. Addressing Net-Metering Concerns: Higher efficiency modules can help offset the impact of reduced net metering benefits by maximizing energy production and self-consumption.

6. Upselling Opportunity: Premium modules can be an attractive option for cash buyers looking for top-tier performance and long-term value.

Additionally, an extensive local support team can help installers navigate technical issues and permitting challenges and provide rapid assistance, improving overall project efficiency.

By leveraging these advanced modules and the associated support, installers can mitigate some of the current market challenges while positioning themselves for future growth in the evolving residential solar landscape.

Looking for a way to shine through in a cloudy market? See how the Trinasolar US Advantage can help.