An Important Warning About The Solar Industry In 2020
The solar power industry is in a price war at the moment. Due to everything that is happening in the world, we are seeing a number of solar installers dropping their prices to win business.
You would think this would be a good thing, but it’s turning into an absolute disaster.
There are two main types of systems being discounted:
- The best possible brands (such as LG Solar, Enphase etc.) discounted by $1000 or more compared to the industry average
- The cheapest possible brands are being sold (typically a ‘6.6kW system with tier 1 panels’) for under $4000 – what we call ‘Cheap Solar
1. The Hidden Crisis: Cheap Quotes On Quality Systems
The solar industry is currently plagued with dodgy operators who are leaving their customers with faulty systems that cost thousands of dollars to fix.
When we say faulty systems, we aren’t talking about a solar panel underperforming slightly. It’s way worse than what most people would imagine.
We are getting dozens of calls a week at the moment from people desperately looking for help to get their system fixed. The bad news for many of these households is the money it costs to fix a dodgy install is typically thousands more than the money they saved by going with the cheapest quote.
Here is a recent example from July 2020:
“I went with one of these systems this year:
1. They flat out stole the “free” pannels
2. After providing me with a plan (requested because I saw on Product review that they had sold systems that did not fit), the installer knew nothing about the plan and just did the job off the cuff.
3. It was not working when they left
4. The installer just threw the “dongle” into the garden, when he vanished
5. I was screamed at down the phone at by the saleswomen when I very calmly and politely advised I was not going to pay for a system, that could not be installed, for plans that were wrong and I wanted it addressed.”
John S. Mount Kembla
Installers Are Hiding Behind Brand Name Products
Dodgy installers are hiding behind big brand names such as LG Solar. They will discount the price by over $1000 compared to the industry average, but they will then claw that money back by cutting corners. Examples of this are biding the install out to inexperienced sub-contractors and running away from any post-installation support.
We are regularly asked by the larger manufacturers to help out with service jobs where the customer has tried to get help directly from the manufacturer.
We have heard of multiple accounts from people who call us looking for help where these installers run their business through a mobile phone so that they can block the calls of upset customers.
How To Avoid A Dodgy Install
Although there is growing pressure for the CEC to clean up these dodgy players in the solar industry, unfortunately for now it is buyer beware.
The good news is it has never been easier to find a reputable installer. Manufacturers are partnering with the industry’s top installers as well as recognising the best of the best with awards.
Continuing with the example of LG Solar panels, Solaray Energy is one of a handful of installers who are Platinum LG Solar Authorised Energy Specialists:
We have also recently been recognised by LG Solar as the best installer in the country:
It takes a bit of time to research the top installers of the products you want on your roof, however conducting your due diligence can save you thousands of dollars, not to mention the time and stress of having to deal with an installer that won’t help you if something goes wrong.
2. The ‘cheap solar’ disaster: 1 in 4 solar systems are faulty
The solar market in Australia is flooded with ‘cheap solar’ again; 5kW-6.6kW solar systems being sold for less than $4000. This is making it difficult to decide on the best solar panels for your home and how much to outlay for a good quality system that will perform as expected.
The largest solar installer in Australia in 2017 was renowned for selling cheap solar systems, and it came as no surprise to us when they recently went into liquidation. They join nearly 1000 installers in the last few years that have now left the industry. As many industry insiders say, the warranties that come with these systems aren’t worth the paper they are written on.
The strange thing is, most people know all about the dangers of buying a cheap solar system. The entire industry often gets a bad wrap because of the reliability issues with these systems. From faulty components to dodgy installations and non-existent service. There are thousands of horror stories posted online, and we get dozens of calls a week from people trying to get their system back online after people give up on trying to get help from their original installer.
We aren’t exaggerating when we say how important it is to avoid cheaper system, the Clean Energy Council recently came out with their findings that an incredible 1 in 5 systems they inspected in 2017 were dodgy – they failed inspection. You can read more about that here: 1 in 4 solar systems are faulty.
Here are some recent examples of what is being advertised online:
If you were going to buy a new television, you would walk into the store knowing that the cheapest model in the shop is probably not going to be the best value. It would be too small, low quality and deep down you know there is a higher chance of the thing breaking within a year or two.
But what if you were mounting the television onto your roof? Out in the weather, baking hot in the summer and exposed to furious winds at least a few times a year. Over 25 years it will need to work perfectly for over 100,000 hours.
Furthermore, it requires a team of skilled installers to spend all day on your roof installing a mounting kit, running high voltage cables and completing an electrical job. It’s also nice when they clean up after themselves.
Everyone understands the basic reasons why the price of televisions varies so much, and yet when it comes to solar power so many of us go hunting for the cheapest quote we can find. Every day I hear people saying, “yes, you have good reviews, your system sounds great (etc.), but I have a quote here for the same system that is $1,500 cheaper…”
IT’S NOT THE SAME SYSTEM!!!
If a 60″ television from LG with the latest technology costs $10,000, and another 60″ from a no-name brand costs $3,000, few people would claim it’s the same television just because they are the same size. Of course, the whole problem of choosing a solar power system is that solar is a completely new industry for most people.
You can now buy a top-quality solar system and get your money back in 3 to 5 years, plus save up to around $50,000 on your power bills over the life of a 5kW system.
A Warning About Cheap Solar Systems in Sydney
It’s great to see the risks of cheap solar getting more publicity in the media in 2019. A stark reminder from the 7.30 Report was published in March 2019 about the dangers of cheap solar power systems. Disappointing output, poor system design and an inverter that needed to be replaced 3 times!
“Do your homework before you install solar.” Over 700 solar installers have gone out of business since 2011, creating an estimated 650,000 solar orphans – many households now left with worthless warranties:
The Cheapest Solar Power Quote Is Rarely The Best Value
First, let me explain why I established Solaray along with Peter Thorne. We did so because we believed there was a need for a company that delivered quality, reliability and honesty in all aspects of its dealings with customers, suppliers and staff.
We looked around the industry and found there were many, many instances where customers had been made unrealistic promises, overpaid for or been supplied with shoddy products or services and often left without after-sale customer service.
It was, therefore, one of our main objectives in founding Solaray to set a standard for the industry to follow – a standard where customers know they are receiving the right advice for their own situation, that they will receive what was promised, and in the event of a problem, that the company and its team will deal with it to the best of their ability.
This means we do not sell ‘cheap solar’. If you search for cheap solar you will not find a listing for Solaray simply because we are not able to provide a quality solar system for the prices seen at the bottom end of the market.
So if you want a 5kW system for under $5,000, you will find one. But after reading this article I hope you will come to see that $5,000 is a huge amount of money to pay for the risks involved. Don’t join the dozens of calls we get every week asking for help on a system that is around 4 to 5 years old and doesn’t work anymore… and of course, the original installer doesn’t answer your calls, or they have gone out of business.
Solar Power is an Investment
A quality solar power system is designed to last 25 years and beyond, and now the better solar panels such as LG Solar NeON 2 modules come with a 25-year product warranty to back that up. When installed to the highest standards, little to no servicing is required (although some inverters may need replacing in around 10 or 15 years), allowing you to passively reduce your power bills for decades to the point where you can end up saving around $50,000 off your power bills over 25 years on a 5kW system.
If you buy cheap brands, there are two main things that we see happening over and over again. Either the output isn’t what it should be, or the components simply break and need to be replaced. It’s rare for a cheap system to show any signs of trouble in the first year or two (by which time you have left a glowing review of how great your system is), but it is at around the 4 year mark (just when you are getting your money back) that things start to go wrong. But unlike a television – you can’t just throw out a solar system and buy a new one.
One of the main issues we see with cheap inverters is they die and are unable to be fixed. The inverter converts DC to AC and is the working part of the system. Cheap solar systems generally use inverters from China that cost less than $500. I often joke that you should buy a spare one with a system like this because eventually, you will need it. If you want your inverter replaced with a good quality product, you are looking at around $2,000 or more, just to get your system back online.
Solaray only sells inverters from the top handful of manufacturers. These include ABB, SMA, Fronius, SolarEdge and Enphase. They have ‘best in class’ efficiency ratings, close to perfect reliability and lightning-fast service when needed. It’s incredible how much of a difference it makes when the manufacturer’s service department answers the phone after a couple of rings, processes a claim and ships a replacement immediately. In the unlikely event that your solar system needs to be serviced, time is money because your system is turned off until it is fixed. I think one of the most glowing testimonials I have ever seen was when we replaced an inverter in a matter of days, all free of charge to the customer and all under warranty. Do an online search for solar warranty claims to see just how many nightmare stories there are right across Australia about people trying to fix cheap solar systems. What can you do if no one answers the phone?
Cheap solar panels are pumped out of China at a dime a dozen. They are often re-branded with a slick logo, or they are simply shipped to countries like Australia and sold without a brand at all! Have you ever seen a quote with “20 x 250W solar panels”? I see it all the time. It is literally a no-name product!
Cheap solar panels can often have no claimable warranty despite the marketing claim of a full 25 year Power Output Warranty. Often there will be a phone number that no one answers or contact details for an office in China where no one speaks English. Furthermore, if it wasn’t brought into Australia through an official distributor the warranty is lost if the manufacturer goes bust (or simply changes their name).
For the warranty to be of any value, the product must be supplied through official distributors and the manufacturer must have an office in Australia. The company must also be in a strong financial position and listed on a western stock exchange. This is why I insist that Solaray only supplies the top handful of manufacturers, and we have a strict vetting process before we bring a new brand in for our technical team to begin testing. If they give it the all-clear, we will then consider supplying it alongside the big brand names such as Trina Solar, Q Cells and LG Solar.
There used to be hundreds of panel manufacturers and it was a minefield for customers trying to decide. The industry has now matured to the point where the top 6 panel manufacturers have close to 50% market share. It is now so easy to pick a reliable brand with full support, as long as you don’t get sucked into the cheaper end of the market.
Problems with the Panels
When I’m driving around Sydney, I am starting to see more brown solar panels. This is due to a chemical reaction in the panel that can affect output, not to mention they look horrible. The fact that I see them sitting there for months makes me think they are not getting replaced under warranty.
Hotspots are another problem with cheap solar panels that completely destroy the panel. Hot spots can be caused by something as common as bird poo. Good quality panels have the appropriate technology to ensure hotspots are prevented using bypass diodes. Even in the case where a warranty is claimed successfully, it is important to note that your entire system is switched off when a panel gets damaged (unless you have an Enphase or SolarEdge system), and claims with some cheaper manufacturers can take months to get processed.
DC isolators are something most people know nothing about, even after they have a solar system installed. And yet cheap DC isolators cause all types of problems, including fire. If you buy the cheapest solar system you can find, there is a higher chance that the installer will cut corners on the quality of electrical components. Quality DC isolators are around 5 times more expensive than the cheap ones, and this is why we only use the best models available. Even better – an Enphase system doesn’t have high voltage DC at all, as the conversion to AC happens under the panel. It’s safer, it means no DC isolators and hence no chance of this happening:
Avoid The Cowboys: It’s Incredibly Easy to Strip $500 Out of an Install
Now we get into the murky side of the solar industry where companies rely on the brand names of the products they are installing, only to strip quality out of the installation service to cut costs and win your business.
I’ve just mentioned the risk of cheap DC isolators, but the list goes on. Installers selling cheap solar systems often auction out a job to the cheapest team of subcontracted installers willing to take the job. Is it necessary to say that the cheapest installers have a reputation within the industry for poor quality jobs?
Will they go out of their way to help you if something goes wrong?
Did you know that a number of companies selling cheap systems have in their terms and conditions that the installation guarantee is passed on to the contracted installer?
Good luck trying to get them back out to your house if they damage your roof!
Solaray has industry-leading install standards, and we do not cut corners. The installation of a solar power system is a service: there are good installs and bad installs. Our reputation as the best Solar Installer in Australia (based on both industry and customer feedback) is primarily about our installation standards and our post-installation service & support.
At the end of the day, any installer can quote good brands. It’s what happens after you sign the contract that really matters.
Misleading and Untruthful
There are a number of companies that have sales representatives that mislead and essentially do whatever is necessary to get you to sign on the dotted line. The ACCC has fined solar companies a number of times for misleading customers. Sales members are often on a commission-only pay structure and if they don’t hit their monthly target they are sent packing. Of course, when your job is on the line you are going to do whatever you can to bring in the sales, especially when your employer turns a blind eye. Some of the claims I see regularly are:
“Our panels are the greatest”… when they are not.
“Our panels are tier one”… when they are not, but how can you know?
“Solar rebates are finishing and prices are going up on Friday”… well, prices might be going up on Friday but it has nothing to do with the rebate ending, which will finish eventually I guess!
“5kW Solar System with 6 panels and a 5kW inverter”… this one is against the industry code of conduct. Can you see what is wrong with it? Leave a comment below if you’re not sure.
“Our panels are made in Germany”… or made in China on German machines… or use German technology… or are simply not German:
Buy Quality Solar Panels
When it comes to buying a solar power system buying good quality brands from a reputable installer is one of the most important purchasing decisions you will make. I have compared it to buying a television, but perhaps the risks involved show a closer parallel to buying a used car. It is so easy to get ripped off, it is incredibly easy to pay too much and it is expensive to fix any problems that arise.
This is why I recommend you choose quality products, go with a solar company with a stellar reputation and a company that offers full warranty support, service, system monitoring and a fair (rather than a cheap) price. It is also why we have built Solaray on these principles, and it is why we have been ranked as one of the top 5 solar installers in Australia (and the largest installer of Enphase systems in NSW).
Solaray are the Trusted Solar Installer in NSW
Industry Leading Install Standards and Full Customer Support