Brian Hayden of HeatSpring, an expert online solar education site, asked Kerim Baran of SolarAcademy about an underserved, overlooked – but exciting – opportunity in solar. The answer? Operations and maintenance (O&M), an area that has considerable growth potential given what is occurring in the resi solar market.
Here’s the video transcript:
Brian Hayden: I want to know what’s one area of the solar industry that has been overlooked, underserved and you think is attractive for startups?
Kerim Baran: O&M, operations and maintenance of existing residential solar assets. You know, this is not a huge problem yet, but I think it’s going to become an increasingly bigger issue. Because, as you might remember, starting about seven, eight years ago with Sunrun and Solar City and Sungevity, I’ll call them the Wall Street and Silicon valley VC funded solar solutions. They were great for the industry because they really expanded the space very rapidly. Their solution, which was a lease based product or PPA based product, which is third party owned was not necessarily the best thing economically for the homeowner, was easy to sell and good enough for the homeowners to buy into.
And their market share of these third party owned solutions went from like 20, 30% to 80% from maybe eight, nine years ago until three, four years ago. But what’s also happened in the meantime is that homeowners have realized that it’s actually way more economical and much smarter to own the systems if they want to just learn a little bit more about these systems.
Also on average an America houses change hands every seven years. And when that happens, that third party ownership usually gets folded into the house purchase. So the homeowners actually end up owning these things, even though they were initially sold as third party owned solutions.
So I don’t know to what extent that will be a challenge for Sunrun’s business model, but the bigger question is what’s going to happen to the homeowners when a third party is not responsible for owning and operating that asset, which is happening a lot. And so I think that will become a big opportunity.
And there’s a company called Stable Solar that’s been focusing on that space too that I’ve been helping.
Brian Hayden: Snuck in a fourth, nice work.
Kerim Baran: Yeah.
Brian Hayden: All right. Well, thanks. That’s super helpful. Appreciate your weigh in. And I think we should make this a regular thing.
Kerim Baran: Great. Thanks Brian.