The High Cost Of Very Cheap Solar
Caution – extremely cheap solar has a high cost
The best deal is very rarely the cheapest deal. This is something we all understand intuitively.
So why do we get so easily get seduced by unbelievably cheap solar deals that appear so totally believable?
Let me be totally up front with you. I did not set up SolarQuotes as a tool for people to find the absolute cheapest solar systems on the market.
If you want the cheapest solar systems on the market, just type “cheap solar” into Google and click on the Google Ad that promises a 5kW system for $3,000. It really is that simple. Don’t use my service. If you use my service, you should get great deals on quality hardware, well installed. The prices will be keen, because the installers are competing with their peers, but you’ll almost always be able to find a cheaper, lower quality system elsewhere.
Most of the companies that advertise these ‘too good to be true’ deals have approached me asking to join the SolarQuotes network. Iturn them down.
I don’t do this because I am trying to manipulate the market or keep great deals away from my visitors.
I do this because I run SolarQuotes with a very simple philosophy. If I would not recommend a company to my grandmother. I will not recommend them through SolarQuotes.
You see, while the front-end purchase may be cheaper with these systems, the Chartered Electrical Engineer in me knows that the long-term consequences of buying these stupid-cheap systems is that they are more expensive to the buyer. While they’re being seduced by the low price, they’re getting sucker punched because they don’t know the ramifications of choosing that cheap option.
In the end everyone loses. The consumer loses, the industry loses, and the companies with the razor thin margins lose too. Because the problem with a racing to the bottom of a market is you might just win.
So how do some companies sell systems at such jaw droppingly low headline prices?
Here are some of the ways I’ve seen people getting burned and getting themselves into trouble because they don’t understand the hidden costs of the cheaper option.
1. Bait & Switch. Use quality components as the bait. Advertise genuine Tier 1 panels and a top end inverter. Put in your conditions of sale that you reserve the right to swap out the inverter and panels for ‘equivalents’. Install a really cheap inverter and panels.
2. Bait and Switch V2. Don’t advertise the brand of panels and inverter, just a really low price. When the customer makes an enquiry, upsell them to better hardware, with the end result that they pay much, much more than the price that was originally advertised.
3. Cut corners on the Install. I was shown an job ad on Gumtree last week. It was asking for backpackers who wanted to earn $17.50 per hour wiring up switchboards and panels for a solar company. It said they needed their own ABN but didn’t need an Australian Electrical Licence. This is a recipe for disaster (and probably illegal). For example, here’s what can happen when a novice works on your switchboard:
No ferrules, terminal over tightened. Photo: Crap Solar
4. Cut corners on the install V2. Some companies have reputations for paying the lowest install rates in the industry. Guess what – they also have a reputation for really poor installations. Most solar systems operate at high voltage DC. If installed well, high voltage DC is safe. If it is not installed well it is very dangerous. Here’s what happens when high voltage DC goes wrong:
A burnt out isolator. Photo: Crap Solar
5. Use crappy panels but claim they are the absolute cream of the crop! Some companies claim their panels are Tier 1, but they are nothing of the sort. Cheap panels do not last in the Aussie sun. Good panels should last 30 years plus. The recent import statistics show that around 60% of panels coming into Australia are not Tier 1. That’s a worry.These low end panels will start failing and it can be really hard to get a low-cost solar company to honour the panel warranty for these reasons. Here is what can happen to a badly made panel within 2 years:
A thermal fracture caused by a hot spot expanding within the panel. This is what can happen when panels are mishandled or worse still poorly made.
The back of the same panel. The installer refused to replace it. Claimed it was impact damage.
6. Use a crappy inverter and claim it is the best quality money can buy! A really cheap inverter will be unlikely to last 3 years. Inverters are easier to replace under warranty than panels, but still some manufacturers will blame the failure on ‘grid spikes’ and you’ll either have to fight, or pay $1500+ for a new inverter. Hey inverter manufacturers! If you want to sell into the Aussie market, then you have to cope with grid spikes because our grid voltages are all over the place!
7. Hire commission only salespeople, treat them like crap and fire them if they don’t reach their quotas. If the salesperson you let into your home is under constant threat of being fired, do you think they might be more likely to oversell the benefits, exaggerate the quality and push for the sale there and then? Of course. These guys are under the pump.
8. Turn crap quality solar panels into an opportunity to make even more money! There is a loophole in the solar rebate. You can replace all the panels on someones roof and claim the rebate again!. The rebate is worth over $700 per kW installed. A really cheap and nasty panel can be bought for under $500 per kW. Do the maths!
I could go on and on – but I’m starting to get depressed!
Do you want a system that is well designed for your roof and your consumption patterns? One that is genuinely designed with a view to adding batteries in the future? One that uses good quality panels, inverters, racking, wires and isolators? One that is installed by a trained solar electrician who is paid a fair wage and is given the time to do things properly? One that will make you happy for decades to come and give you a well optimised return on your investment? One that will be supported in to the future if there is an issue? If this is what you are looking for in a system then please be wary of the ‘too good to be true’ offers online, in the papers and on TV.
All the information you need to make an informed choice is on this website, and you are absolutely welcome to contact me if you need any help, whether you got your quotes through this site or elsewhere.
