Best Solar Companies

Solar Company Types

There are a variety of different types of solar companies out there that can help you to go green. Understanding the difference between these types of solar energy companies and what each one has to offer gives you a leg up when determining which company is best for you.

Solar manufacturers:These companies produce the solar equipment that is installed on your home. Most solar panel manufacturers do not provide solar panel installation or financing services.

Solar installers: These companies actually come out to your house and set up the photovoltaic panels created by manufacturers. Most solar panel installers are local companies that primarily operate in a specific area.

Solar dealers: These companies have received permission to sell certain manufacturers’ solar products. Some dealers have their own in-house  solar installation team, while others outsource installations to third parties.

Full-service providers: These companies do everything to get you set up with solar outside of manufacturing the equipment. Full-service providers sell the panels, provide financing, and perform the installation.

Vertically-integrated companies: These companies take care of every single aspect of the solar process, from manufacturing the panels to installing them on your roof. There are very few vertically-integrated companies in the solar industry, but those companies (SunPower and SolarCity, to name a couple) are huge players.

Solar financiers: These companies strictly focus on providing financing for solar equipment and installations. Financiers usually partner with solar dealers and solar installers.

Solar lead generation companies: These companies put their emphasis on generating leads and sales for other types companies within the solar power industry. Instead of selling or installing panels, lead generation companies put together contracts which are then sold to installers, dealers, and full-service providers.

Solar Payment Options

There are four primary ways to pay for a solar photovoltaic system: outright purchase, loan, lease, and power purchase agreement. The best option for you depends on your state of residence, financial situation, and housing status.

Outright purchase: Purchasing a solar PV system outright is a good option if you have the funds to do so and are interested in a high dollar-for-dollar return. However, the actual return you will receive on an outright purchase is dependent upon the utility prices and incentives available in your state; higher utility prices and more incentives generally result in a larger savings over time.

Loan: Financing your system with a loan is a great way to go solar if you have equity in your home but would like to minimize the upfront cost. Many solar companies partner with financiers or banks that specialize in providing loans and other financing options for solar projects. Solar financing contracts generally range from 5 to 20 years and offer interest rates between 1.99 and 4.99 percent, depending on your credit score. Plus, with a solar loan, you’ll still be eligible for state and federal solar incentives.

Lease: Leasing a solar system can be beneficial if you live in an area with high utility prices and want to save on your electric bill without investing a significant amount of your own money in solar. With a solar lease, you will essentially be renting the system from a solar company or third-party financier for cheaper than what you were previously paying for power. However, keep in mind that when you lease, you do not own the system and therefore are not eligible for state or federal solar incentives. Furthermore, solar lease contracts typically last for 20 years, which could pose issues if you don’t stay in your current residence for that long.

Power purchase agreement (PPA): Signing into a PPA is similar to a lease in that you can save money on your utility bill without investing in solar by allowing a third party to install a system that they own on your roof. However, PPAs differ from leases in that you will only pay for the system-produced power that you use at a flat, locked-in rate.

Solar Warranties

While warranties are great because they help to protect both your equipment and your investment, they can be a bit confusing because there are several different types tied to solar systems—manufacturer warranties, product warranties, performance warranties, inverter warranties, and workmanship warranties.

Some solar contractors use vague verbiage and are not entirely upfront about which warranties will actually be attached to the solar system you purchase from them. However, if you are aware of the following warranties and what each of them covers, you’ll be better prepared to ask your solar rep and get solid answers before you sign a contract.

Manufacturer warranties: These warranties come directly from the company that manufactured the solar panels. Product and performance warranties both fall under the umbrella of manufacturer warranties.

Product warranties: These warranties are offered by the manufacturer and cover the solar panels themselves. If the panels fail or break due to manufacturing defects, environmental issues, or premature wear and tear, the manufacturer will replace them for free. Most solar panel companies offer product warranties that cover panels for 10 to 25 years.

Performance warranties: Sometimes referred to as “performance guarantees,” these warranties are offered by the manufacturer and cover the power output and energy efficiency of the solar panels. Performance warranties ensure that your solar panels are not under-producing. If any of the panels lose more than a certain percentage (typically 10 to 20 percent) of their promised energy output during the life of the warranty, the manufacturer will replace those panels for free. It’s required by law that all solar panels come with at least a 25-year performance warranty.

Inverter warranties: These warranties are provided by the company that manufactured the solar system’s inverter. If the solar inverter fails or is not able to handle the calculated energy capacity, the manufacturer will replace it for free. Depending on the inverter type—string or micro (see below for an in-depth explanation of the difference between these inverters)—the warranty could last between 5 and 25 years.

Workmanship warranties: Sometimes referred to as “service warranties” or “installation warranties,” these warranties are offered by the company that sold you the solar system. These warranties cover labor-related defects, such as damage to your roof or other parts of your home or property as a result of solar system installation. Not all solar installation companies offer a workmanship warranty, but the ones that do usually provide coverage for 5 to 10 years.

Solar Panel Types

There are two main types of solar panels that are used for residential projects: monocrystalline panels and polycrystalline panels. Technically speaking, monocrystalline modules are comprised of one crystal of silicon, while polycrystalline modules are comprised of several silicon crystals.

The biggest difference between these two types of panels lies in efficiency rating, which conveys how effective the panels are at converting the sun’s rays into electricity for your home. Monocrystalline panels are generally more efficient than polycrystalline panels, which means you need fewer monocrystalline panels than polycrystalline panels to produce the same amount of energy.

For homeowners who have limited roof space, monocrystalline panels are probably the best option. However, for homeowners who have plenty of roof space, polycrystalline panels should do just fine.

Solar Inverter Types

Inverters are an important part of any solar PV system because they convert the direct current (DC) electricity that your panels produce into the alternating current (AC) electricity that is utilized by both your home and the grid. There are two main types of inverters used in the solar industry today: string inverters and microinverters.

String inverters tie all of the panels in a solar system together into a circuit, or “string,” which means that anything that affects one panel will affect all of the panels. For example, if one panel on the string becomes shaded, all of the panels on that string’s production is dramatically decreased. Most string inverters are warrantied for 10 years.

Microinverters, on the other hand, provide each solar panel in the system with its own inverter. Each microinverter operates independently of its fellow microinverters, which means that shading on one panel will not affect the production of any other panels. Microinverters typically come with a 25-year warranty.

Homeowners who live in particularly sunny areas will probably be safe with a string inverter, which is the cheapest of the two options. However, those who live in areas that are prone to shade or cloud coverage will be better off with a microinverter.

Solar Efficiency Ratings

Efficiency is a measure of a solar panel’s ability to convert sunlight into energy. The higher the efficiency rating, the more electricity is produced by the panel in a given amount of time. Efficiency ratings for solar panels generally range between 14 and 24 percent.

While purchasing super efficient panels might seem like the best option, it’s not mandatory unless you have a small roof and a high power usage. If you have sufficient roof space to do so, you can most likely save money and receive the same output by adding a few extra, less-efficient panels to your solar array.