2010 is widely expected to be a break-through year for solar power. Cheap PV, new financing models, a rebounding economy, increased consumer awareness, and strengthened government support could combine to push rooftop solar panels fully into the mainstream — like buying a new car, or remodeling the kitchen.
The question is: do people care who they buy their solar panels from?
Brands matter, but their importance in the residential and commercial solar power industry is up for debate. The stakes are high: if they do matter, then companies like Sun Power, who are spending heavily to promote their brand identity, could take a commanding lead as the industry grows.
Many experts question the importance of brand in what is essentially a commodity. From the Environment blog at Reuters:
“When I buy electrons, I don’t care what flavor they are. I do care a lot about what they cost,” said Stephan Dolezalek, managing director of Silicon Valley venture capital firm VantagePoint Venture Partners.
In California, the top ten solar panel installers have less than 40% percent of the market. That’s a pitiful percentage compared to other industries, and suggests that consumers of solar power, whether individuals, businesses or utilities, are less concerned with the brand name than cost and convenience.
Sun Power’s chief executive Tom Werner argues that consumers want the peace of mind that a brand name can offer. From the Reuters piece:
“Remember white boxes PCs were going to run over the brand-name players? But people wanted to buy from a brand-name player because they wanted the service, they wanted that future-proofing –that I don’t buy it today and it’s obsolete in six months,” Werner told Reuters at the summit in San Francisco.
For an individual buying panels for their home, knowing their installer is not some fly-by-night company hoping to hop on the solar power bandwagon is probably worth a few more pennies per watt. Concerns about employee training and professionalism, service, and support are bound to cross the mind of anyone considering shelling out tens of thousands of dollars for a system.
Of course that high price also means consumers are going to be eager for a bargain. Self-installation by consumers looking to avoid the middle-man altogether rounds out the top ten installers in California.
There is another path to take for solar power installers and manufacturers, one that another industry selling a commodity with low brand loyalty took, to great success. The “Got Milk?” campaign, started by the California Milk Processors Board, became a nationwide phenomenon, and is credited with increasing milk consumption after a twenty-year slump.
Could such a general campaign benefit the solar industry? The benefits have been bandied about in the media for a while, and the Solar Energy Industries Association (SEIA) just recently decided to revisit the idea.
The two biggest hurdles for solar power are one, price, and two, educating the consumer. The first is largely out of the control of the companies paid to install panels. On the second, Sun Power and others are betting going alone will pay off. But if solar power is indeed only a commodity with the brand loyalty of milk or, for that matter, electricity, then banding together to increase demand may be the best way for companies to spend their marketing dollars.