A core area of business for The Energy Project is helping companies install commercial solar. As part of this work, we act as an independent advisor to our clients in selecting the best installer for them. This article shares some of our learnings from having been through this process many times. It also comes with an inherent bias based on how we approach the process that we’ll be upfront about.
There are broadly two approaches that can be taken
- a) get three quotes for solar and let the installer guide you on how much, what and where to install it or
- b) independently conduct a feasibility study and use this to define the size of the system and high level parameters, then obtain three quotes against this specification.
Whilst some solar installers are very capable of providing high-quality advice on feasibility, design and sizing when left to the installer you will likely receive three quotes for three very different systems. We think this compromises the process of comparing the quotes too much and hence recommend the former approach.
Having analysed your site and defined sought multiple quotes for the same capacity system, you can more easily separate comparison of quotations – which becomes more about the components and installation – from the comparison of the installers themselves.
Both approaches can have positive outcomes, but it’s through this lens that this article is written.
How to compare solar system quotations
The key areas we look at when comparing quotes for our clients include:
- Technical attributes of the system design
- Quality of components used
- Inclusions, exclusions and qualifications that may impact the price or the system delivered
- Project management methodology
- Engagement of the vendor in the quoting process
- Intangibles such as flexibility, local business support or additional services offered
Let’s take a closer look at each of these.
Technical attributes of system design
With three or more quotes in hand, comparing the proposed system design from each vendor can highlight if one of the vendors has a smarter or more considered solution and in turn identify gaps or limitations in the other quotes.
Some specific areas we look at for technical design evaluation include:
- Panel placement – do the proposed layouts provide adequate edge clearances, have panels been placed to minimise the impact of any shading, are arrays sized to provide reasonable access to all panels for maintenance, have optimal roof areas been utilised.
- Compliance with regulations – has a suitable level of network protection equipment been allowed for based on local network operator guidelines and system size? Have safety requirements such as edge protection during construction been considered? Have any export limits been taken into account?
- Output modelling – has the generation of the system been modelled using PVSyst or Heliostat and were the assumptions or inputs to this model appropriate.
- Ratio of panel to inverter capacity – as panels only produce their rated maximum power output for a short period of the year, oversizing panels to inverters often improves the value of the system.
Quality of components used
As with all manufactured products, the solar industry provides components ranging from high-quality high cost to lower quality and lower-cost options. To enable a fair comparison of the total system price a view needs to be formed on the quality of the components quoted.
Such a comparison is unavoidably subjective and it’s an area where we apply our industry experience to form a view. In lieu of this, Google searches should provide you with no shortage of product reviews to help you compare.
Whilst there’s merit in weighting the focus to the more major components in comparing quality, don’t forget to consider all of the components that make up a commercial solar system.
Lastly – a note in regards to specific component brands and quality. When you choose a company to install your solar system, they will typically have a set of component brands that they work with and recommend. This provides for operational efficiency which translates into optimum pricing.
Inclusions, exclusions, qualifications
In comparing quotes it’s important to look beyond the topline metrics of system size and price to check for conditions which may impact the total cost of the system once it’s installed.
It’s common for quotations to include a series of qualifications or inclusions and exclusions. Differences in these conditions between quotes can have a material impact on the installed system cost. Once you’re contracted you can’t avoid paying for requested variations if the vendor has clearly identified that they may occur.
A similar approach can be adopted in comparing the system design by comparing what is included or excluded by the different vendors. In aggregate, you should get a view of the key components that might be required and could trigger variations.
Some key areas to consider follow, noting that not all of these may be applicable to a given site:
- Limitations on distance for cabling from inverters to distribution or switchboards
- Allowance for network cabling for inverter Internet connection for monitoring
- Network protection units, both minimum requirements and site-specific requirements from network operators
- Physical housings for weatherproofing or security required for inverters or switchgear
- Distribution or switchboard upgrades
- Weekend or after-hours work if required based on site occupancy patterns
Project management methodology
As commercial systems increase in size, the project becomes more substantial in terms of logistics and duration of construction. As this occurs a formal project management approach is often warranted. Project schedules should be developed and dedicated project managers need to be assigned to ensure installation progresses smoothly.
Where warranted, evidence of allowance for project management and thinking about how the project will be approached ideally should appear in the quotations. Areas to look at in this information include:
- Site access: has it been considered, are there any constraints, is traffic management required for equipment delivery, has consideration been given to temporary equipment storage locations, can delivery trucks and lifting equipment gain access when required.
- Roof access: how will the panels be raised onto the roofs, is there suitable areas at ground level for placement of lifting equipment. How will the installation team gain access to the roof? are there in-built stairs are should temporary stairs be installed?
- Team members: have project managers been allowed for in the quote?
- Timing: has the vendor given an indication of the project duration, are there any constraints as to when they can complete the works? Have the confirmed that they can work around any time constraints you’ve identified.
Quote process engagement
In the process of obtaining quotes, communication will likely occur across face to face meetings, email and telephone. Vendors should at a minimum be invited to a site inspection.
The level of engagement by vendors during this quoting process can provide both a guide to their level of interest in winning the work and also the thoroughness of the quote that is received.
At any given time each installer will have varying levels of work in their pipeline with a finite capacity to complete projects. If they’re overly busy they might feel an obligation to quote but adopt higher pricing as a filtering mechanism. Alternately, in the course of providing the quote they may realise that the project is not within their core area of competence. Vendors that are eager to win work and confident in their understanding of the project, on the other hand might invest more time in the process and price more aggressively.
A vendor that has a higher level of engagement, spends more time on site, asks more questions or seeks more detail has a greater capacity to ensure that nothing has been missed and all required components have been allowed for in their quotation. This should translate into a lower risk of variations to price once you’ve committed to the vendor.
Whilst it’s an imperfect proxy, we tend to believe that the engagement and interaction with an installer during the pre-sales phase should offer some insight into the level of service that can be expected as a contracted customer of the same vendor.
How to compare solar installers
Having compared the proposals received, a comparison of the solar installers themselves and their fit with your company should also be made. For this some key areas to consider are:
- Business strength
- Relevant experience
- Project management capability
- Alignment of size and operating mode between you and the vendor
Again we’ll consider each in a little more detail.
This is the most subjective and hardest to judge aspect of comparing solar installers and it’s unlikely that you’ll be able to form an absolute view on whether the strength or stability of a vendor should be a concern.
The strength of the business is important as an indicator of the probability that they’ll still be in business, 5, 10, 15 years from now if you have a problem with your system.
Similar to the approach that is taken with the level of engagement on the quote process, we think a useful way of looking at this aspect is via a series of proxies. Some to consider using are:
- Years in business – a new business that hasn’t reached profitability might limp along for a few years, but the owners are unlikely to be ploughing away at the 10-year mark if the business is not operating well, keeping clients happy and generating sustainable profits.
- Business premises – look up their published addresses on Google maps. Do they operate from commercial offices or warehouses? Do they have one location or multiple? These can give clues as to the size of the business.
- Credit check – if you want to be cautious, consider running a creditworthiness check on the business. Whilst they won’t be your debtor, if they’re not paying their creditors on time it’s not a good sign.
- LinkedIn – use LinkedIn to see how many people identify themselves as working there. It’s a crude metric (due to data accuracy limits) but it can be a useful cross-check against any team size figures they publish. Looking at the individual profiles of the founders or executives may also help.
- Accreditations – look at the list of accreditations held by the company. Whilst they’re not a guarantee of work quality, the accreditations themselves cost time and money to obtain and may more often be associated with more established businesses.
- Industry support – is the company a member of industry associations, do they sponsor events, can you find a reference to them in the media? These again all related to activities undertaken by more established business than smaller business.
Whilst the basic principles are the same, the nuances of completing solar installations vary as a function of size from <10kW to 30kW, 100kW and larger projects around the MW mark. A business that regularly installs systems in the size range that you’re looking to have installed, is more likely to be well versed in such projects, be more efficient, and less likely to run into project delivery challenges.
Ask the vendors to provide a list of recently completed projects of similar size to your own.
On this front, consider also seeking unsolicited references for the vendors either at the quotation stage or earlier in choosing who to obtain quotes from. Industry peers, fellow business owners or building managers may provide a source of references. You can also use Google maps to identify businesses in your local area that have installed solar.
Project Management Capability
Along with project methodology, the project management capability is critical for larger projects. Installations around the 100kW mark and above it may be appropriate to see specific reference to project managers for your job.
Ensure that vendors have both allowed for it and that they have the team members that can do the work.
Alignment of Client and Vendor
Achieving a successful installation requires a harmonious relationship between the client and vendor. Matching the scale and operating of the mode of the two can pay dividends.
In a smaller business, many decisions are often made directly by the owners with limited paperwork or meetings. Pairing them up with a similar-sized vendor might result in a much better experience than are larger vendor which has multiple layers of team members and is more process-driven. Being able to pickup the phone and talk to the owner of the vendor might be valued more highly than certifications, the number of employees, or a list of well-known clients.
Likewise, a large corporate client might overwhelm a small vendor with requests for certifications, meetings and documentation even when they’re very capable of delivering high-quality work.
Consider what you value in the relationship with your vendor and ask the right questions to judge if they’re a good fit for you.