The potential for solar power is now enormous. The economics are attractive; the appeal is proven; the code has been cracked. With proper marketing, the future of solar power is very bright indeed.
The Key To Residential Solar Power Is Now Marketing
Brian F. Keane | SmartPower
A pivotal transition has taken place for residential solar power: its growth is now driven by middle-income homeowners concerned about keeping energy costs in check. That’s a landmark transition that opens the door to exponential growth. Now the key to success is marketing – not simply promoting a message but orchestrating on-the-ground campaigns community by community that literally bring the “solar store” into each neighborhood. The good news is that a proven method is already available.
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This pivotal transition is due in part to falling prices. For the third year in a row, solar prices dropped. The installed price of solar photovoltaic (PV) power systems in the United States fell substantially in 2012 and the first half of 2013, according to the Lawrence Berkeley National Laboratory. Installed prices for PV systems in 2012 fell by a range of roughly $0.30 per Watt (W) to $0.90/W, or 6 to 14 percent, from the prior year, depending on the size of the system – adding to the continuous string of significant, annual, price reductions for PV systems.
Those dropping prices attracted middle-class homeowners looking for savings in energy costs. The Center for American Progress analyzed the three states with the most residential solar systems – Arizona, California, and New Jersey – and found that installations are overwhelmingly occurring in middle-class neighborhoods that have median incomes ranging from $40,000 to $90,000.
Residential solar power is no longer simply the choice primarily of those with a preference for clean energy – it can now be marketed broadly, based on economics alone. The challenge, however, is to spur adoption on a large enough scale. Solar energy today provides just two-tenths of 1 percent of the total energy consumed in the United States, according to the Institute for Energy Research. Yet increasing that percentage dramatically is in the interest of our nation, the environment, and individual homeowners.
The key is marketing – and not just message development. Some messages are, of course, crucial. They include the economics of residential solar power and the potential breadth of its application. One might assume, for instance, that the South, renowned for its sun-drenched days, would have significantly more potential for residential solar than New England.
Yet New England gets about four hours and 20 minutes daily of what’s called direct normal irradiance (DNI), the absolute best sunlight for converting to energy, compared to the “sunny South”, which gets about 4.5 hours of daily DNI. That means that a modest 225-watt solar panel in Atlanta will produce just seven percent more electricity over the course of a year than a similar panel in Boston. New England also has the highest average retail price for electricity of any region in the lower 48 states, according to the U.S. Energy Information Administration, so the incentive to save is even greater.
The key to marketing residential solar is to engage communities, and the code for doing that has been cracked. In September, the non-profit SmartPower, which I lead, and Connecticut’s Clean Energy Finance and Investment Authority (CEFIA) released a report titled “Let’s Solarize” that revealed a proven model for dramatically reducing the cost barrier that has stood in the way of wide-scale adoption of residential solar power in the United States. In each of four towns – after just 20 weeks – the rate of adoption for residential solar installations was between 24 and 64 times greater than the previous seven years. The average customer saved about $7,500 on their system, compared to current market averages. Most significantly, about 20 percent of those choosing solar under this model had never previously thought about acquiring solar power.
The essential ingredients of this marketing effort, which is now being expanded to other states, are the following:
- The initiative should be community-sponsored with municipal buy-in and support. Town and local volunteers need to take responsibility for community outreach, giving residents the confidence to move forward with the selected installer.
- Local solar champions are crucial. People who already have solar are its most passionate and best spokespeople, and the Solarize program created a great opportunity for them to reach out to friends and neighbors by designating them “Solar Ambassadors.”
- Prices must be below market. It must be clear to residents that they are getting a rare and time-limited bargain. Return on investment is more aggressive and solar is accessible to more homeowners when installers can pass savings on to their customers.
- Visibility is essential. Lawn signs, banners, events, workshops, social media, and traditional media are needed to promote the program, ensuring that no one fails to hear about the opportunity.
- The campaign must have an end date. A very public end date ensures that prospective customers take action. The last week of the Solarize campaigns across the four pilot communities saw a 40 percent uptake in signups.
The potential for solar power is now enormous. The economics are attractive; the appeal is proven; the code has been cracked. With proper marketing, the future of solar power is very bright indeed.
Brian Keane
Brian F. Keane is President of SmartPower and author of Green Is Good: Save Money, Make Money, and Help Your Community Profit From Clean Energy (Lyons Press, 2012). He is a leading voice on clean energy, energy efficiency and the environment. As President of SmartPower, a Washington, DC-based marketing agency dedicated to promoting clean, renewable energy and energy efficiency, Keane has helped shape the energy debate in the United States and brought clean energy and energy efficiency to the American consumer.
The content & opinions in this article are the author’s and do not necessarily represent the views of AltEnergyMag
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