Why You Shouldn't Buy a Cheap Solar PV System
You wouldn’t walk into a dealership and immediately purchase the cheapest car, so why do some consumers choose to purchase the cheapest solar PV system available?
While it may seem like a great idea initially (who wouldn’t want to save $1,000 to $2,000 off a major purchase), the truth is those who purchase cheap solar systems are often stung by much higher costs in the long run, or they are left with a system that doesn’t generate anywhere near as much as they expected.
To find out why purchasing the lowest priced system on the market may not be your best option, read on.
Your System’s Components Will be Low-End
Cheap solar PV systems are usually cheap in components, as well as price. If the 6kW solar system you’re considering is well below the market average, we encourage you to look closely at the products being offered.
Ensuring the solar components you’ve selected have sufficient warranties in place is vital. However, there are many companies on the market that, at face-value, can seem like a decent, reputable company. However, when you dig a little deeper, you discover they use several dodgy tactics to avoid covering their warranties.
For example, there are some solar companies on the market that require you to regularly service and clean your solar panels, and inform customers that without adhering to these conditions, their warranties become void. This is both unnecessary and a reflection of an untrustworthy company.
These ludicrous warranty conditions are seen by companies such as Astroenergy, who require their customers to get their solar panels cleaned monthly, as well as anytime the weather produces 'dusty' conditions. This can be an extremely costly exercise, and essentially takes away from the financial benefits of having a solar system.
You will often find that the cheaper systems are accompanied by dodgy tactics like this, as this is the companies way of reducing their liability and reducing costs.
This is not an isolated problem either, with Universal Solar Group solar panel’s performance warranty becoming void if servicing is not completed once every three months, along with an additional service every one and five years.
An Australian presence is potentially one of the most important factors when selecting which brands of components you choose for your solar system. Ensuring the solar provider you’ve chosen to purchase your system through stocks products from a manufacturer that has an Australian presence will make it much easier trying to claim your warranty should you face any issues with your system. This is because an Australian presence guarantees, by law, any service and support are handled locally, rather than overseas. Claiming a warranty from a manufacturer located overseas is both time-consuming and difficult. If in the event of the solar provider closing up shop, some customers can be left without any warranty support, and may need to cover the costs to repair or replace their entire system themselves.
In addition, we see countless solar providers cut costs and remove overheads through only having virtual offices. Essentially, they have no customer support staff, no system designers, and use cheap or even unlicensed electricians to complete the installations.
While our headquarters are based in Perth, Infinite Energy provides services all across Australia, with local offices set up in each city.
Your home is one of the most valuable assets you’ll ever own, so when selecting a panel to install on your roof, you want to ensure you’re choosing a high-quality, reliable panel that is designed to last for decades to come. When selecting a reputable solar panel, you should focus on the warranties being offered, and the length of time the manufacturer has been in the market. Longevity of a manufacturer provides an indication that the company can last through the ups and downs of the solar industry, reducing the risk that they could go bankrupt and leave you with a worthless warranty. It also gives an indication the manufacturer has been able to keep up with technological advancements within the industry, ensuring you’re getting an optimum panel designed to produce long-term savings.
Established in 1985, SunPower is considered a market leader in the solar panel industry, producing some of the highest performing and reliable panels available. Their panels have been used by NASA for their Grover, Helios and Pathfinder projects, as well as being selected for Australia’s largest solar farm consisting of 1.1 million solar panels. SunPower was the first company to offer a 25-year product warranty on their panels - a testament to their reliability, quality and performance. While other brands have since followed suit, SunPower still remains at the forefront of the industry.
When selecting a solar panel from a manufacturer like SunPower, rather than opting for a cheaper, low-quality alternative, you can have peace of mind knowing your system is going to continue to provide you with long-term savings, significantly reduced risk of failure, and lifetime support from an outstanding company.
The solar inverter lies at the heart of your system. This sophisticated piece of electrical equipment is responsible for the conversion of DC electricity to AC electricity; controlling the voltage of the system to extract the maximum power available; and reporting on the solar system’s performance. As a result, inverters are where the most faults in a solar PV system occur.
We see several inverter brands on the market that are considered low-quality and unreliable, continuing to make their way into peoples homes due to their low-price offering. However, these inverters usually fail after just five years, putting your whole investment at risk, with replacements costing thousands of dollars.
On top of this, there have been countless inverter manufacturers who have claimed their product is top-notch, only to disappear after a few years as they struggle to keep up with the ongoing warranty claims they receive. For example, brands like JFY, Mac Solar, Sharp, and Bosch, have all come and gone, leaving thousands of customers without a manufacturer to claim their warranties or fix faults.
To reduce risk of choosing an inadequate inverter, we recommend using the below chart when considering which inverter to choose. If the inverter is not on this chart, it is not considered reputable with Australian support. Infinite Energy provides Fronius, SMA and SolarEdge inverters, which as you can see, are all listed.
Balance of System
Cheaper PV systems are also likely to use low-quality Balance of System (BOS) components. BOS components include your racking/mounting, cables, connectors, electrical panels and wiring. When companies cut costs on these parts, they increase the risk of faults occurring, as well as reduce the performance of the system; which in turn means less savings for you.
Infinite Energy takes great care in selecting their BOS components. For example, isolators can range in price from $20 to $100. We could certainly offer our customers cheaper systems by choosing the cheaper isolator, but we opt for the more expensive because it means a better performing system for our customers.
Companies know they can get away with using cheaper parts in the BOS, as this is usually not thought about often, and generally most customers have little knowledge in this area. You can of course ask the solar company for a list of the BOS they use, and then do your own research. However, for many this is just too time consuming. Simply by comparing prices amongst your various quotes, if there is one (or a few) that seem to be significantly cheaper, you can often ensure the company have found some way to reduce their costs in this department.
Purchasing the Cheapest System May Impact Your Returns
In addition to reducing carbon emissions, most homeowners purchase a solar PV system to save on their electricity bills. Because payback periods for solar PV systems can be anywhere between 2-5 years, it might end up being a few years before you’re able to directly pocket any savings.
Therefore, your solar PV system will essentially only save you money if it continues to perform after the payback period. While purchasing a good quality system may cost you more initially, you have the peace of mind that it will continue to perform and save you money long into the future. It’s also important to note that most older systems cannot be repaired due to the components no longer being available. Therefore, it will not be an inexpensive repair but a full replacement, completely nullifying any savings you may have made in the short-term.
Burnt out connectors
Your System’s Cheap Price May Be Compensated by Dodgy T&Cs
If a price seems much too low compared to what other providers are offering, it’s a good idea to take a look at the solar provider’s Terms and Conditions. T&C’s can be a minefield of dodgy ‘Gotcha’ Clauses, where solar providers make up for the money they’re not getting selling their systems.
In some cases, installers resort to a ‘bait and switch’ scheme, where they talk you into purchasing a supposedly high-quality panel for a low price but will install cheaper substitutes instead. This is where ensuring you read your quote's T&Cs in-depth becomes very important.
Some other conditions we’ve seen in the past include having your system installed by roofing contractors, and signed off by an electrician. This is extremely unsafe and puts you and your home at risk. It also is likely that the system won’t be installed to correct standards, which can greatly inhibit the performance of your system.
Companies can also include in their T&C’s that the contractor they’ve assigned to your installation is liable for any damage or defect in the installation of your system. Essentially, your solar provider is passing all liability onto the contracted installer. This means if something goes wrong with your installation, your solar provider is absolved of all wrongdoing, and is not required to offer you any assistance or reimbursement. You’ll have to take on the contractor (if you can find out who they are) by yourself.
You can read more about what to look for on your quote here.
Junction Box failures
Solar Companies That Go Bankrupt
More than 750 solar companies have gone bankrupt since 2011, leaving thousands of customers without any support or warranty to fall back on. We see a large amount of solar companies fail before they reach the 5-year mark. This can be for a variety of reasons, but often most commonly because they have opted to sell cheap, low-quality equipment that begins to fail in as little as 3-5 years and they are financially unable to deal with it.
As terrible as it sounds, some businesses do this intentionally. When they get a surge of warranty claims that the business cannot support, they close their doors and leave hundreds of systems “orphaned”.
We also see a lot of businesses run on unsustainable margins, so much so that a slight change in STC price can quickly see the companies go bankrupt.
How to Choose the Right Solar PV System
Like any major purchase, don’t let price be your one and only deciding factor when investing in a solar PV system. Take the time to research your solar provider, including how long they’ve been in business, if they’re CEC Approved, their T&Cs and be aware of any high-pressure sales tactics. Quality of components, level of customer support and extra’s such as Whole of System warranties also need to be considered.
Infinite Energy receives numerous phone calls from people whose initially cheap system simply does not work. At the time of purchase, they thought they had a safe warranty; however, their provider has since gone out of business or due to a loophole in their T&C’s, refused to honour any warranty.
Purchasing a solar PV system is more complicated than simply buying whitegoods, such as a fridge. It’s more like buying the components of whitegoods, making a decision as to who assembles and warrants the construction, and ensuring that all of the internal components are correct. Ultimately, a solar system is a power station attached to one of your most valuable assets – your home, so the quality of a good panel or inverter is something only money can buy.
The price ranges below can be used as a general guide to decipher where your system sits in regard to component and installation quality:
- Cheap components with cheap installers: $2,500-$4,000
- Good components with cheap installers, or, cheap components with good installers: $4,000-$5,000
- Good components with good installers: $4,000 - $9,000
The saying “The bitterness of poor quality remains long after the sweetness of low price is forgotten,” rings especially true in the solar industry.
For no obligation advice on investing in a solar PV system for your home, give us a call on 1300 074 669, or click here to request a callback.