As we approach the holidays, the LA Solar Group Review reflects on the past year to acknowledge how thankful we are as a team for planning our objectives, achieving our goals, and confronting challenges that helped us grow as an organization and leader in the solar industry. With all our efforts and success, we close this amazing year with one central purpose in mind – to provide the best to our customers.

 

The 2017 Solar Market

2016 was the was a record breaking year for the U.S. solar market because it was the year that our country generated the most electric capacity (residential, commercial, utility) than any other source of energy. U.S. installed 14.8 gigawatts of PV power – 97% increase from 2015. U.S. was the 2nd largest Solar PV installer behind China. Local installers in California installed a cumulative 5.37 gigawatts of solar energy. That’s 42% of all US PV capacity.  30% of homeowners decided to buy their system in cash with 18% financing with a loan. 52% of solar projects were third-party owned through a power purchase agreement.  Following the biggest solar market ever, the first quarter of 2017 installed 2000 megawatts of U.S. residential solar power with California remaining as the country’s largest residential solar market. Solar ranked as the 2nd largest source with new electric generating capacity totaling 30%. U.S. installed 2,387 megawatts of solar PV in quarter 2 which is an increase of 8% – the largest second quarter ever in the solar industry.

However, a shift in the market lead to residential projects falling 10% quarter per quarter. California also experienced a shift as residential solar grew only 1% while non-residential grew 31%. From Q1 to Q3, California accounted for about 40% of the residential market, yet experienced 23% reduction in installations compared to 2016. The decline is driven by 3rd party owners that have scaled back operations in effort to be more profitable. Power Purchase Agreements or PPA were not as popular this year than they have in previous years making it difficult for 3rd party owners to maintain a return on investment; a challenge faced by many solar companies.  Another factor that shifted the solar market this year was the uncertainty of the Section 201 trade case filed by American solar pv manufactures Suniva and Solarworld due to financial losses.

We can say that 2017 was an unconventional year for solar. For the first time in our booming solar market, there is an sense of uncertainly looming in the future. But being able to quickly adapt to these shifts is what has made us successful this year. What it came down to is how resilient solar companies are to withstand the changes and maintain continuous, progressive growth. Unfortunately, many companies weren’t able to continue running their business and compete with lower costs; pushing them to file bankruptcy or get bought out.  Nationwide companies such as Sungevity and Vorengo as well as local solar companies such as American Solar Direct and A1 Solar had strong market share in residential solar installation, but weren’t able to complete with the price declines. They also lacked to properly structure their operations to meet customer demand.  These companies failed to establish customer relationships and with poor quality and customer service they were forced to downsize and exit the industry.  How we were able to thrive is what set us apart to make 2017 a record braking year for us. For the 2nd year in a row we were listed as one of the fastest growing companies nationwide and locally. We grew 1,247% with the last 3 years. But our growth doesn’t happen by chance. There’s a clear reason why we experienced success despite the decline in residential solar. We increased our installations this year by 32% from 2016. That’s over 1000 installations in a single year, a recording breaking year for our company.

5 Year U.S. Solar Installations – Source: GTM Research

 

LA Solar Group 2017 Building & Safety Permits for Solar Installation (Statewide)

 

Company Culture

One of the most crucial changes we made this year was the improvements we made to our company culture. The solar industry has been a volatile industry this year. With high competitiveness and companies down sizing, job seekers and employers were challenged with high turnover. Investing into our company culture, we ensured that our team continued to grow in the right direction while setting a positive impression to new team members.  At LA Solar Group, we consider our team as a family. Different departments  interact with each other in ways that make the solar process more simple and streamlined for the purpose of producing happy customers – which is what we are in the business of. We defined ourselves as the company that wants to empower peoples future with smart energy solutions. As a company we’re dedicated to professionalism and problem solving in a fun and positive atmosphere with our core values as the guiding force in how we conduct business.

 

 New Services by LA Solar Group

Whether it’s technology, products, and/or innovation, we’re always thinking of new ways to enhance the customer experience. This year we introduced emerging technologies and services that are changing how people are consuming energy.  2017 was a leap for battery storage which has been gaining popularity for smart energy management.  Earlier this year, we partnered with Tesla and became one of their premier battery storage installers in Southern California. Since their announcement of the Powerwall 2, demand quickly grew for battery storage by property owners that previously installed solar. With California State SGIP program, we took advantage by offering substantial discounts toward the cost of purchasing a Powerwall 2 battery. We quickly established a system to facilitate applications for over 100 new and existing customers through a customized process in order to qualify our homeowners for the SGIP incentive.  With our success in servicing battery storage, we were able to reserve an additional 110 Tesla Powerwall 2 units despite the companies production shortage.

Another important aspect of our expansion was the launch of our roofing department.  Roofing and solar go hand-in-hand so why not make the process more simple and convenient for our customers? Well, that’s exactly what we did. We’re about growth and challenge. We’re about happy customers. When a customer can trust their roof with LA Solar Group in additional to their solar installation, we exponentially add more value to our customers. As licensed roofers, we were better able to incorporate roofing projects with solar projects making it more affordable home improvement project. Being completely in-house helped speed up the installation process and provided less headaches..

Our objective has always been to empower people’s future with an honest and technical approach to home energy solutions. One of the smartest solutions for home energy is home energy automation. With homes that have solar, there’s no better way to manage a home’s energy use. This opportunity led us to partner with the Flex Living. Their technology integrates with a home solar system making solar simple and smart while adding more savings to electric usage.

 

Expansion and Growth

Our consistent growth with the last 3 years has allowed us to venture out beyond our local area and into new emerging solar markets. We’ve successfully been able to open 2 offices, one in north bay called Bay Solar Group and another, Kern Solar Group serving Kern Valley. Expanding to these new areas allowed us to increase our workforce and create more jobs.

 

2018 Company Outlook

We’re proud of what we accomplished and where we are going.  There’s a lot of opportunity and challenges in 2018 that we’re very excited about. One of the primary challenges we’ll be facing is the results of the Section 201 trade case and how the market will react once the President decides on the outcome. Nevertheless, we confront challenges as a way to grow and we’re confident that our innovative hard work and resiliency will pave the way. We’re going to continue to innovate and give back.  Our surrounding community is important to us so we have plans to contribute by being involved with local university programs, advocating climate change and sustainability with our local community, and connecting and contributing to non-profit organizations that can benefit from solar energy. Overall, there’s a lot to be excited about in the 2018. Best wishes for a joyous holiday season with a very bright and happy New Year!

 

 

Sources: GTM Research, SEIA  | Watts based on Direct Current (DC) units of electricity

Robert Sarai

Robert Sarai is a leading expert in energy efficiency and sustainability with L.A. Solar Group. He oversees development and marketing efforts to guide property owners toward smart energy solutions. He can be contacted directly at 818-946-2320 or robert@lasolargroup.com. LinkedIn Profile