This spring Groundwork launched Groundwork Shines to demonstrate to homeowners and businesses – as well as utilities and legislators - that solar power has arrived as a vital part of Michigan’s energy future. Through Shines, we’re working with local solar installers to better understand the challenges and opportunities for residential solar here in the Grand Traverse region.
Across the U.S and parts of the world solar power has erupted as a new source of energy, as the price of solar panels has dropped 73% since 2006. Places like Germany, China and California are all investing heavily in solar energy, creating jobs and energy stability. But here in Michigan, investment in solar energy lags behind.
Many people assume that clouds or cost are the biggest barriers to Michigan’s solar industry – but we’re finding that it’s much more a lack of smart state solar policies that are discouraging industry leaders from moving into Michigan, and relegating homeowners to working with very small companies that have limited capacity to scale up, meet demand, manage customer service – and have virtually no marketing budget.
That’s where Groundwork Shines is designed to help. Last winter Groundwork staff met with local solar installers in the Traverse City area to better understand what types of help they need to move an industry in a tough business climate. Shines is partnering with the local installers to offer marketing and customer support to help them spend more of their time on sunny roofs installing panels, and less time talking to homeowners with shady roofs or who aren’t serious.
So far this summer we have learned a lot about the challenges of promoting solar installations in Michigan:
Price of Solar Power in Question?
First, we learned that Traverse City Light & Power and Cherryland Electric Cooperative are considering slashing the price they pay homeowners for rooftop solar power; and the Michigan Legislature is suggesting proposals that would do the same thing statewide. While not a deal-breaker, a lower price for solar power extends the ‘return on investment’ time, making it somewhat less attractive to a potential customer.
We have engaged our local and statewide allies and pushed back on all these anti-solar proposals, arguing that rooftop solar is, if anything, more valuable to power companies, ratepayers, and communities than the power from centralized, fossil-fueled power plants.
Our coalition talked with TCLP board and management folks. We engaged local businesses about their desire for more clean energy. We railed against regressive state proposals with editorials, member emails, and meetings with local and state officials.
So far, TCLP has held off on its rate change; the anti-rooftop solar proposals have stalled in the state legislature; and Cherryland, hearing some sharp protests, now will reconsider its solar rates, which don’t kick in until November, annually.
While the price utilities pay for residential solar power continues to be a concern, we have continued to move ahead with Shines promotion.
Solar Marketing to Meet Installer Capacity
In late spring we did our first, very low-key Shines marketing. Without spending a single dime on materials – by simply sending a couple of emails and announcing the idea at community meetings - we very quickly found that 70 area homeowners had signed up on our Shines web page with a sincere interest in purchasing solar panels. We realized we needed to slow our promotion until we could be certain that our installers could meet the demand.
We’re working through our list of potential solar citizens while trying to do the right amount of marketing. Too much and there’s lots of customers waiting for our call back—not good. Too little and installers’ home-based projects dwindle.
Today, when someone contacts us about Shines, we do a Google-eyed virtual assessment of their property to see if their roof is solar-friendly. If it is, data from their energy bill indicates system size, and we estimate its cost.
We assign homeowners who want to move forward to local installers and accompany them for the initial site visit. We talk with the customer, take some pictures, and the installer offers them a contract. As I write, we’ve got about 20 installer contract proposals out with interested customers.
The initial sticker price for a solar array that provides all power for a good-sized home can cost close to $20,000—minus the 30 percent federal income tax credit. That kind of price tag can scare off many homeowners that haven’t worked through the math to see how it can actually pay off as a smart investment over time.
For those who can’t front that kind of cash, the numbers can still work, thanks to Michigan Saves, which specializes in loans for home, business, and institutional efficiency and renewable energy projects. Today homeowners can get a 10-year, no-money-down loan for a right-sized system providing all of their electricity for about $200 a month.
The math works this way: The homeowner was likely spending $100 per month on electricity. Eliminating that utility bill means he’s still spending $100 a month, but on himself, not the utility. Once the loan is paid off, the panels can still provide at least 15 years—and likely quite a bit more—of completely free electricity—a $12,000 payback. And, as studies of home sales by the National Renewable Energy Laboratory confirm, the system will add a handsome premium to a solarized home’s price. So a homeowner can recoup most or all of their original investment.
Installer Capacity to Respond to Homeowner Demand
As we look to the end of our first Shines season, we think the next bottleneck could be finding enough qualified solar professionals—roofers, electricians, site assessors, and sales staff—to keep spreading solar contagion.
That’s particularly true because Northern Michigan’s economy is seasonal, and workforce housing is impossible to find during much of the installation season. Since only a small amount of solar is installed in our area, there’s a lot of hands-on training to do. Increased customer demand will mean struggling to fill solar jobs—a wonderful problem to have, but a problem nonetheless.
Northwestern Michigan College could help. Its team of veteran instructors and solar installers could pump out 100 solar workers in an academic year. But we first must prove there is enough demand for students to invest time and money in courses. All the pieces are here to make that happen, but we’re still trying to fit them together.
Testing A Direct-Marketing Pilot Project In Frankfort
Meanwhile, as we work through our list of Shines folks, we’re getting ready to start a different marketing campaign, focused on Frankfort.
We used web-based mapping to assess rooftops in that community and identified 50 homes with solar-friendly roofs. Those homes will receive letters about our program from Groundwork, as well as supportive local officials, and community leaders. If this works, it will produce a list of folks who are clearly interested, clearly qualified, and, hopefully, ready to go. That could save installers some valuable time, and lead to some reduction in installation costs.
By launching our Shines program, we are learning about the challenges facing the solar industry in Michigan. But more importantly, we are creating strategies to overcome them.
Dan Worth is the Clean Energy Policy Specialist at the Groundwork Center for Resilient Communities,