While looking for a solar system, it is important to keep in mind that solar installers frequently have small profit margins and might not be able to give significant reductions on their rates. Therefore, instead of attempting to bargain for a lower price, it is preferable to concentrate on negotiating more value, such as supplementary guarantees or site visits.
To avoid hiring poor contractors and pick a reputable business that provides high-quality tools and trustworthy after-sales support is crucial. In addition, it's a good idea to acquire numerous quotations and carefully compare the products and services offered to ensure you're getting the greatest value.
How can I negotiate a better solar deal?
Sometimes friends and family, who know I spent over a decade in the renewable energy industry, ask me if it’s worthwhile to haggle and negotiate with your solar installer for a better price.
Of course, all the hundreds of installer friends in the industry will say – just tell them NO.
Many shoppers feel confident about negotiating the price of a car or other goods and services. This theoretically could also include some haggling over the price of a solar PV system for your property.
Like property, investing in a solar array can be immensely beneficial on many fronts, so trying to negotiate the best deal is essential. Some incentives, such as the STC rebate, make it an even better deal, and then if one could haggle some extra margin from the solar sales guy – how good would that be?
However, the reality is that the solar industry generally works on relatively tight margins.
So the opportunity to cut off $1,000 from your quoted price is not there. The local solar company isn’t earning that kind of money to discount the system by such margins, even though your solar system may cost thousands of dollars.
Why are there tight profit margins for solar panel installers?
Overall outgoings to install the system are one reason behind this. These are all non-hardware expenses that your installer will have to pay. They include visible expenditures such as parts and labour and less evident costs such as payroll tax, insurance, running vehicles, etc.
On average, this leaves an industry norm 10-15% profit margin in the business, which equals $800 -$1,200n an $8,000 system.
Sometimes, quality solar companies are even slightly upset or offended if somebody tries to push the price down when offering a fair quality deal. What I found can work much better, and the advice I give is to try to get some extra value out of the quote.
An extra value is, for example, that after 12 months, somebody physically comes out and double-checks that the system is performing to standard and does a proper solar system inspection. Such a system check site visit would usually cost around $300-$400.
Another option is to ask the company to give you an extra year of workmanship warranty rather than knocking the price down.
Avoid trying to negotiate with cheap solar companies
One thing you shouldn’t do is try to save money by hiring a substandard solar company. Although you may feel all the warranties and quotes look professional, you always get what you pay for in solar.
If one buys a bargain solar system, in the 15 years I have been in the industry, there has been only one certainty – you get what you pay for. You will have more headaches than you bargained for if you hire a sub-par contractor with sub-par gear. Even the quality gear will not perform well when installed poorly.
What are the potential hazards, do I hear you ask? Unprofessional contractors can damage your landscaping and leave screws all over your lawn. You may also find that your roof is beginning to leak within a few weeks because of broken tiles or poorly installed tile brackets.
If you have a warranty issue, they might not return your calls for service. The cheapest quote is not always the best if you have numerous quotes for the same equipment but different pricing.
What should I do when purchasing my solar system?
Overall, regarding solar energy projections for your system, a reputable business will be accurate, propose high-quality equipment at a fair price, and give a trustworthy, long-time after-sales service when needed.
They will not promise you a zero-dollar electricity bill, they will not mention five times their panel is Tier 1, and they will not use famous sports people to impress you (What do sports people know about a solar install, I always wonder).
They will provide a robust, future-proof long-lasting solar and battery system. Such a system will save you a lot in the long term and, therefore, will be far more valuable than the modest amount of money you could save by using a less reputed provider that allowed you to bargain them down to an unsustainable price point.