Along with the increasing popularity of solar PV systems comes the need for high-quality operations and maintenance (O&M).
This is an area that is often overlooked but has been gaining attention in recent years. In this lecture, Dr. James Rand introduces infrared imaging (IR) technology and explains how it can be used to greatly improve solar […]
Dr. Sean White takes on student questions about National Electrical Code compliance, solar panel Time of Use (TOU) optimization and inverter lifespan.
Student 1: Why do some AHJ’s (Authority Having Jurisdiction’s) still allow installations under a previous edition of the National Electrical Code? Safety being paramount, is there a time limit for adoption of the latest code?
Dr. Sean White: I […]
Chris Lord’s FREE Site Lease vs. Buy Modeling Calculator allows users to compare a lease rate against a potential purchase of a solar PV site where the lease rate (including escalator) is known.
This tool is used in HeatSpring’s Financial Modeling for Solar PV Projects course.
About Chris Lord
Christopher J. Lord is a lawyer with extensive banking experience, and the Managing […]
In the article below, Vaughan Woodruff, Expert Instructor, Solar Approaches to Radiant Heating, outlines a response to a student who recently asked a question regarding the use of solar electricity for heating and how advances in battery storage might impact the suitability of using solar electricity to provide heating.
“Even though grid-tied electric battery storage is less efficient, is it […]
The most important element of a profitable solar company is maximizing what I am referring to as “the sales equation”. In this article, I want to share specifically what the sales equation is, and what questions you can ask to begin to understand how well your company is doing. Sales is the front line of the solar industry. While your business needs the technical expertise to design and install a solar system, those skills alone will not insure your business is successful.
While consulting with a new solar company, figuring out the best way to structure the new company to maximize profits, and speaking with Keith Cronin who sold solar company to SunEdison, I’ve learned that there is one single question key to a successful solar company. If you’re running a small businesses that is run on cash and does not have outside investment, super efficient marketing and sales and an overlap with operations is what will set your business apart.
This may sounds simple, but it’s not. Most small construction companies have net profit margins of around 5%. In the solar or geothermal industries, you should be able to bump this up to at least 10%. Accordingly, your gross margins should be around 20%.
In order to do this, this is the equation you need to maximize.
A profitable solar or geothermal sales engine = high gross margin on project * closes the fastest / marketing dollar spent.
Why this equation?
The equation is showing that the best companies will get the most amount of profit and cash in the fastest amount of time possible. By it’s nature, it includes how you structure the company, your ability to cost jobs correctly, your effectiveness at client relations, and how effective your marketing is.
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