Guides
Best markets for a solar installer business
Best markets for a solar installer cannot be listed. This is the scoring worksheet that ranks candidate territories on the seven factors that actually decide it.
What to take away
- No markets are named here. A published list of best territories would rank places on sunshine and population, which are two of the least important factors, and it would be out of date by the time you read it.
- The worksheet below scores a candidate territory on seven factors, weighted by how much each one actually moves your cash and your schedule.
- The two heaviest factors are the utility's interconnection process and the building department's practice. Both are unglamorous and both decide whether you get paid this quarter.
- Score at least three candidates. A single territory scored in isolation always looks reasonable.
Why sunshine is not the answer
Irradiance affects the customer's production estimate. It has almost no effect on whether your company is profitable.
What affects that is how long the building department takes to review a plan set, how long the utility takes to grant permission to operate, what the roof stock is like, whether you can staff a crew, and how many surveyed roofs you have to walk away from. Two territories with identical sun can differ by a large factor on every one of those.
That is why this page is a worksheet rather than a list.
The seven factors
Score each from 1 to 5, then multiply by the weight. Higher is better in every case.
Show the numbers
| Utility interconnection process | 5 |
|---|---|
| Building department practice | 5 |
| Roof stock | 4 |
| Service panel stock | 3 |
| Labor availability | 4 |
| Competition and its behavior | 2 |
| Distance from your base | 3 |
Total the weighted scores and compare candidates against each other rather than against any absolute figure.
How to get each score
Utility interconnection. Call the interconnection desk. Ask for the current processing time, whether contractors must register, and what the standard requires of equipment. A utility that cannot answer is itself a score of 1.
Building department. Call, ask for the residential solar submittal list, the current review time, and the adopted code editions. Then ask whether they will look at a sample plan set. Willingness is as informative as the answers.
Roof stock. Drive it, and look. Coverings, ages, pitches, access, and how many properties are shaded by mature trees. An afternoon tells you more than any dataset.
Service panel stock. Roughly correlates with housing age. A neighborhood built in one decade will have a characteristic service panel situation, and a local electrician will tell you what it is.
Labor availability. The Bureau of Labor Statistics occupational employment and wage tables publish employment and wage estimates by occupation, industry, state, and metropolitan area, which indicates whether the relevant trades exist there at all. Then talk to people, because the published figures will not tell you who is actually available.
Competition. Look at what local contractors publish and what their reviews say. A territory where high-pressure sales have damaged trust is harder to enter honestly, though it is also an opportunity for a company that behaves differently.
Distance. Measure a round trip with loading, at the time of day a crew would actually travel.
The factors people over-weight
Population. More houses is not more demand if the roof stock is poor or the utility is slow.
Sunshine. Affects the customer's numbers, not your operating economics.
Published incentive programs. These change, and they are set by the state energy office, the utility, and, for federal credits, the Internal Revenue Service. Building a territory choice on a program's current generosity is building on something you do not control and cannot promise a customer anyway.
Growth statistics. Regional installation growth says nothing about whether you specifically can install profitably there.
Before scoring anything, check the gates
Some territories are ruled out regardless of score.
Is your license valid there? A different state usually means a new application with its own timeline, and the state contractor board is the authority. How to establish it is set out in the licensing and compliance guide for solar contractors.
Does the utility's interconnection standard require equipment you do not install? That can eliminate the territory or force a product change, which is a cost in itself, and the purchasing consequences sit in the equipment and setup guide for solar crews.
Does the roof stock demand flashing systems your crews do not carry? The load list in the equipment checklist for new solar owners is the reference for what would have to change.
What the score cannot tell you
Whether you can actually win work there. That is a sales question, and a high-scoring territory with an entrenched local competitor may be harder than a lower-scoring one where you know people.
It also cannot tell you the learning penalty, which is real in every new territory: your first-time inspection pass rate falls and your days to energization rise while you learn a new process. That is covered in the expansion guide for solar contractors, along with the argument that growing depth where you already are usually beats growing width.
The general business layer
Some of choosing a market is ordinary business planning: financing, staffing, and the operational side of growth. The SBA business guide covers those activities in the general case, which this page has assumed rather than repeated.
The permit dimension of factor two is described in the Department of Energy's solar permitting guidebook, which explains how documented system information, local building and electrical review, inspection, and utility coordination fit together. It is a description of the stages rather than a rulebook, and each jurisdiction's adopted codes and published process are what govern.
Factor five has a training dimension as well as an availability one: a territory with no existing trade presence can still work if you are prepared to train from scratch, and what that costs is set out in the hiring and training guide for solar contractors.
Testing the winner
Do not commit on a score. Take three jobs in the highest-scoring candidate at a price that includes the learning penalty, measure the same things you measure at home, and see whether the numbers converge by the third job.
Three jobs is a cheap test. Thirty is a commitment made before you had the evidence.
Common questions
How often should the scoring be redone?
Whenever a utility changes its process or a jurisdiction adopts a new code edition, and otherwise annually. Both of the heaviest factors move.
Can I score my existing territory?
You should, first, as a baseline. Knowing what your home territory scores tells you what a candidate has to beat.
What if every nearby territory scores poorly?
Then the answer is depth rather than width: more work, or more scopes, where you already are. That is a legitimate outcome of the exercise and a common one.
Does a territory with no competition score well?
Not necessarily. Sometimes nobody is there because the utility is slow or the roof stock is bad, and factors one and three will already have caught that.
