What Is A Turnkey Solar Solution?
What Are Turnkey Solar Solutions?
Turnkey solar solutions refer to solar energy systems that are designed, installed, and maintained by a solar company with minimal effort required by the customer. This end-to-end service allows homeowners, businesses, and even utilities to go solar with ease.
With a turnkey approach, the solar company handles everything from system design, engineering, permitting, installation, interconnection paperwork, and ongoing maintenance. The customer simply signs an agreement and financially owns the system without having to manage the process.
Turnkey solar provides a straightforward path to solar energy without the hassle of finding various vendors, contractors, financing, etc. The solar providerStreamlines and simplifies the process with a single point of contact. This allows customers to adopt solar energy while minimizing their time and resource investment.
In summary, turnkey solar solutions offer a convenient way to go solar through an all-inclusive, start-to-finish solar service managed by experts.
Benefits of Turnkey Solar
The main benefits of opting for a turnkey solar installation are convenience and cost savings. Turnkey solar providers handle every aspect of the system from start to finish, making the process easy for the customer.
With a turnkey solar solution, the solar company takes care of permitting, paperwork, and inspections. This removes a significant headache for the customer, as the paperwork and compliance requirements can be complex and time-consuming to navigate. The turnkey provider is an expert in solar regulations and will ensure the system meets all applicable codes.
Turnkey solar is also cost effective because the solar provider can buy components in bulk and leverage relationships for discounted pricing. These savings are then passed along to the customer. Since the turnkey company manages the entire process, there are also cost savings from not having to hire multiple contractors and manage each phase separately.
In summary, turnkey solar provides ease of installation by handling all the paperwork and licensing requirements. It also results in cost savings through the solar provider’s bulk purchasing power and expertise in streamlining the end-to-end process.
How Turnkey Solar Works
A turnkey solar provider will handle every step of the process, from initial site assessment to system design, procurement, installation, and ongoing maintenance.
Here is an overview of the turnkey solar process:
Site Assessment
The turnkey solar provider will first assess the site to determine the available space, sunlight exposure, energy needs, and any zoning requirements. This allows them to determine the ideal system size and specifications.
System Design
Next, the provider will design a custom solar system optimized for the site and energy usage. The design specifies the solar panels, inverters, racking, and other components.
Permitting & Approvals
The turnkey provider will handle all permitting and paperwork for utilities, incentives, and regulatory compliance.
Procurement & Installation
Once the system design is approved, the turnkey solar company procures all the necessary equipment and manages the installation using their qualified personnel.
Commissioning & Interconnection
After installation, the system will be tested to ensure it is operating correctly and meets all safety and performance standards before being connected to the electrical grid.
Ongoing Monitoring & Maintenance
Turnkey solar providers often include ongoing monitoring, maintenance, and support services as part of the package, to optimize system performance.
Types of Turnkey Solar Projects
There are three main types of turnkey solar projects:
Residential
Residential turnkey solar involves installing solar panels on a home. The solar provider handles everything from system design to permitting to installation. Residential systems are usually between 3-10 kilowatts and can provide 30-100% of a home’s electricity needs. Residential turnkey solar allows homeowners to go solar with minimal effort.
Commercial
Commercial turnkey solar installs solar systems on businesses, schools, municipalities, and other organizations. System sizes range from 10 kilowatts to multiple megawatts. The solar provider handles permitting, engineering, procurement, construction, interconnection paperwork, rebates, and other complex tasks. Commercial turnkey simplifies the process for organizations to utilize solar.
Utility-Scale
Utility-scale turnkey involves large solar farms that feed into the grid. System sizes range from 1 megawatt to over 1 gigawatt. The solar provider manages land acquisition, environmental assessments, permitting and everything needed to get a major solar project connected to the grid. Utility-scale turnkey enables rapid deployment of large-scale solar plants.
Major Turnkey Solar Companies
Some of the top turnkey solar companies in the United States include:
- SunPower – One of the largest solar panel manufacturers that provides complete installation and financing services for residential and commercial customers.
- Sunrun – The largest dedicated residential solar company that handles everything from design to permitting to installation.
- Vivint Solar – A nationwide provider focused on making solar affordable through flexible financing options.
- Tesla Energy – The solar division of Tesla that provides integrated solar and Powerwall battery systems.
- Sunnova – A leading residential solar and storage service provider operating in over 20 states.
- SolarCity – One of the early solar service providers in the U.S., now a subsidiary of Tesla.
- Sungevity – An online solar marketplace that designs and installs residential systems across multiple states.
- RGS Energy – A solar company specializing in turnkey design, installation and financing for homes and businesses.
- Sunworks – Focuses on providing turnkey commercial solar solutions in California, Nevada, Oregon, and New York.
Costs of Turnkey Solar
The upfront costs of a turnkey solar project can vary greatly depending on the size of the system, type of technology, location, available incentives, and more. In general, a residential turnkey solar system costs $15,000 to $25,000 before incentives, while a commercial system can range from $100,000 to over $1 million.
The return on investment timeline also varies. Residential systems typically have a ROI of 6-8 years, while commercial systems can achieve ROI in 3-5 years. The faster ROI for commercial solar reflects the higher energy usage and offsetting higher utility rates.
There are several incentives that can reduce the upfront costs of a turnkey solar installation and shorten the ROI timeline. These include:
- Federal Solar Investment Tax Credit (ITC) – Offers a 26% tax credit for systems installed through 2022, then steps down annually before expiring after 2034.
- State/local rebates and incentives – Many states and utilities offer additional rebates, performance-based incentives, or renewable energy credits to further discount the cost.
- Net metering – Users get credit for excess solar energy sent back to the grid, offsetting utility bills.
- Accelerated depreciation – Commercial solar qualifies for accelerated depreciation deductions on federal taxes.
With the right combination of incentives, turnkey solar can achieve ROI in just 3-4 years and provide decades of free electricity after payback. Carefully evaluating costs, incentives, and long-term savings is key for determining if turnkey solar is a sound investment.
Turnkey Solar Financing Options
Financing is a major factor when considering turnkey solar solutions. There are a few main options for financing turnkey solar projects:
Loans
Many homeowners choose to take out a loan to pay for their turnkey solar system installation. Solar loans provide financing from a bank or credit union that is paid back over time, often 5-20 years. The solar company handles the loan application and paperwork. Loans allow homeowners to own their solar system without large upfront costs.
Power Purchase Agreements (PPAs)
A PPA is a financing agreement where a solar company installs and owns the solar system on a customer’s property for little or no upfront cost. The customer agrees to purchase the power generated from the solar panels at a fixed rate that is typically lower than their regular electricity rate. This allows savings on electricity without purchasing the solar system.
Solar Leases
Solar leasing is similar to a PPA but instead of purchasing the power, customers lease the solar system itself from a solar company. They pay a fixed monthly amount that is lower than their normal utility bill. At the end of the lease term, such as 20 years, the customer may have the option to buy the solar panels, extend the lease, or have them removed.
Factors to Consider
When evaluating turnkey solar solutions, there are several important factors to consider:
Site Assessment
A detailed site assessment is crucial to determine if a property is suitable for solar installation. This involves evaluating the roof structure, roof angle and direction, shading, and electrical infrastructure. The site assessment will dictate the solar system size and equipment needed.
Permits and Regulations
Most areas require permits and approval to install solar panels. The turnkey provider will handle permitting but it’s important to verify the system will meet local codes and regulations.
System Ownership
With a turnkey system, the provider will install and own the system. The homeowner signs a contract to purchase the power generated. It’s important to understand the terms of this agreement.
Maintenance
Reputable turnkey providers will handle ongoing maintenance, repairs and optimizing system performance. Ensure the agreement details the maintenance services provided.
Monitoring
Modern solar systems allow for remote monitoring of performance and output. Choose a provider that gives you access to detailed monitoring data.
Warranties
Quality solar equipment comes with 20-25 year product warranties. The installer should also provide workmanship warranties. Review warranties carefully.
Company Stability
Since the turnkey provider owns the system, it’s crucial they remain solvent. Check the company’s financials and stability before signing an agreement.
Turnkey Solar by State
Turnkey solar solutions are widely available across the United States, but their adoption varies significantly by state due to differences in solar incentives, policies, and major projects.
California
California has abundant sunshine and strong policy support for solar, making it the nation’s leader in solar energy. The California Solar Initiative provides rebates for solar installations, and a renewable portfolio standard requires utilities to source 33% of energy from renewables by 2020. Major projects include the Topaz Solar Farm, an expansive 550MW solar array.
Arizona
Arizona has the second most solar energy potential after California. State tax credits, net metering policies, and renewable energy standards spur solar adoption. The Solana Generating Station near Phoenix is one of the largest CSP solar plants in the world at 280MW.
New Jersey
New Jersey offers robust solar incentives, including rebates for residential systems and favorable SREC trading programs. The state is second only to California in total installed solar capacity, with major projects like the Kearny Solar Array’s 18MW facility.
Massachusetts
Massachusetts incentives like Solar Renewable Energy Credits make the state third in the nation for solar adoption. The state also has an aggressive renewable portfolio standard and over 1GW of installed solar. Major projects include Great Brook Solar in Worcester at 20MW.
New York
New York offers strong incentives through its NY-Sun Initiative as well as community solar programs to spur adoption. The state has committed to 50% renewable energy by 2030. Large projects include the Long Island Solar Farm at 32MW.
Future of Turnkey Solar
The future looks bright for the turnkey solar industry. Analysts project strong growth in the coming years due to several key factors:
Falling Prices: The costs of solar panels and associated hardware continue to decrease. This makes turnkey solar an increasingly affordable clean energy solution. Many experts predict solar electricity will reach price parity with conventional grid power in more markets, further driving adoption.
Supportive Policies: Government incentives like the federal solar investment tax credit (ITC) and various state/local policies encourage turnkey solar installations. Although the ITC is set to phase down, it will remain a tailwind. Net metering reforms in some areas may counteract this to a degree.
Market Expansion: Declining costs allow solar to compete in more regions, beyond early adopter states like California and New Jersey. Expect to see growth in promising solar markets like Florida, Texas, the Midwest and Southeast.
New Technologies: Advances in solar technologies like more efficient panels, improved inverters and better energy storage solutions will further boost the value proposition of turnkey solar. Integrating storage provides resilience and lowers payback periods.
In summary, the years ahead look bright for turnkey solar as improving economics, supportive policies, emerging markets and new innovations drive substantial growth. Customers can expect an increasingly streamlined process as turnkey providers scale up their businesses across the country.
