Tuesday, January 23, 2007

Slashdot users selling solar

The number of slashdot users selling solar is growing so this is an external link to list their sites so you can pick friends, foes or freaks to do business with. When you get to the sites, try the solar savings calculator at the bottom left to estimate how much money you'll save. When you click on "Reserve Your System" you'll lock in the offered 2005 rate which could start saving you money as soon as your system is installed. Any of us will be happy to help you understand the offer in more detail.

In order of appearance:

mdsolar

Keebler1175

modemboy

Olero


The company we are selling for has been discussed on slashdot in response to an article in Wired Magazine. Slashdot readers are pretty tech savvy and have been following advances in solar power for years. To me, the three main things to remember as you read through these comments are net metering, net metering and net metering. Net metering is the reason solar power can work as a distributed power generation method today. It competes at retail prices.

There are other important aspects to the residential solar power business that also need to be considered to make that competition successful. Most of these have to do with reducing costs. On the manufacturing side, a larger fabrication plant reduces production costs by a large amount though it is risky to build a large plant without an assured market since the cost of sitting idle is proportionally larger. The flow of distribution of panels can also be less expensive when the specifics of the market are well known. With a wait list of customers, delivery of panels to installers can be better managed reducing logistical costs. An installer I know has lost a day on the roof because a parts supplier sent the wrong mounting equipment. With panels, mounts, inverters and interconnects all designed to work together these sorts of expensive delays can be more easily avoided. There is also a scaling effect in installation. When an installer is assured of may years of back-to-back jobs, investing in labor saving equipment becomes more attractive even when the initial cost is high. Getting workers and equipment to the roof with lifting equipment avoids the labor cost of erecting scaffolding and trips up and down a ladder. The use of automation to monitor system performance and to handle billing also represents a cost savings since much of customer service is anticipated and the requirements for a customer service staff are reduced. Most people have a monthly personal visit from their utility to read the meter. With automated billing, this cost is avoided (for the company, customers still pay to have their utility provided meter reading, that is the connect charge in your utility bill). Finally, since the sales force works on commission, the costs of attracting customers is controlled to a specific percentage of revenue. This aspect has come in for some criticism on slashdot, but it does lead to large sales at controlled costs. The sales force has already registered enough customers to account for half of the total capacity installed in 2006 in the US (both residential and commercial). This is important because the plant capacity has to be sold in advance to ensure that it produces continuously. Offering rental rates of $0.07/kWh and up ensures a large potential market while long term fixed rate contracts offer customers a chance to save money over time.

Skepticism seen on slashdot and in the industry is pretty understandable, but as one of the lobbyists for a company that does this business in the commercial sector acknowledged to me, someone is going to profit from this business model even it this company does not. In the commercial sector Morgan Stanley, for example, is behind some of Walmart's current solar expansion, though not, so far, part of this company's financing. The trick is to make it work with the smaller systems that are appropriate for homes as it already does for larger systems on commercial buildings. The vertical integration and economy-of-scale savings described here make me think that this business is not "too good to be true" but rather too good not to promote.

6 comments:

modemboy said...

Hey this is modemboy!
Thanks for the linking, looks like you are quite knowledgeable in this area, I look forward to bugging you with some questions sometime ;-)
Later!

Anonymous said...

Hey Chris--Olero here. Thanks for the link and I'm glad to be on the same team as you!

Maybe we'll meet at a national Citizenre conference in the future (I hope)!

PJ

PS--If you could change the link to http://www.qcimarketing.com it will send folks to the right place (it currently is pointing to the main site, which is cool and everything, but if someone likes my name best, I'd love to personally help 'em out! Thanks again!)

Greg said...

Thanks for making the list.

I'm Keebler1175 on Slashdot. I've been selling since January 1.

Solar: Join The Future Now!
http://www.jointhefuturenow.com

Chris Dudley said...

Hi Greg,

Sorry I missed you. Found you're first post on Jan 8 with a search.

Chris

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