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PV Buyer Beware

March 2010

PV Buyer Beware

March is the start of the Spring home-show season. Across Ontario there will be dozens of home / garden / backyard / pool / landscaping shows, with hundreds if not thousands of vendors hawking their wares and services. This year there is a much larger group of "solar companies" displaying at these shows. For example in 2008 there were 3 or 4 solar companies at the National Home Show in Toronto, this year there were at least 16! All of the new companies were pushing solar electric (PV) systems, and all had been in the business less than 2 years - most less than 1 year.

While having a large number of companies to choose from may seem an ideal situation for the person interested in buying a solar system - they're able to "shop around" to get the best deal - in this case all it really does is to reinforce the misinformation and gross performance overstatements that currently pervade the PV solar industry. The vast majority of new solar PV companies have little or no experience of selling and installing solar - with the exception of perhaps buying and installing a PV system on their own - or a relative's - house. Meanwhile they are quoting the supply and installation of PV systems without the knowledge of what it will actually cost to do the work - often only basing their pricing upon what the supplier of the hardware tells them it "should" cost. As a result we are seeing the prices quoted for an installed PV system diving lower and lower as the inexperienced companies quote against each other. Pricing per installed Kilowatt of PV should range between $11,000 and $8,000 for a 1 Kilowatt system to a 10 Kilowatt system. What is being quoted ranges between $7,000 and $3,500. This is well below the actual cost of the work and at $3,500, way below the cost of the hardware!! Some of these companies may be getting their pricing from the internet - which is full of misleading information and pricing. Pricing in Ontario is higher than many other places because of the rules of the FIT program and our climate.

The result of this diving to the bottom of the barrel quoting, will be a lot of these companies going bankrupt and a lot of people are going to get ripped-off.

There will be new solar PV companies who set out to rip people off. They'll take deposits and disappear - just as it has happened in other industries such as the home renovation business.

So, just as you would when buying any other expensive item, be careful. Beware of "prices too good to be true". Beware of companies that talk fast but can't provide references that you can speak to. Beware of companies that want a large deposit up front. Beware of companies who can't tell you who is going to actually install the solar panels and who is going to wire them up. Beware of the hard-sell!

Remember, that for residential systems, the real payback will always be more than 10 years with a best-case return on investment of 5% to 7%. Companies that claim that they can provide better returns should be considered highly suspect!! Don't let false promises and unrealistic expectations impair your judgment.