Solar installers develop relationships with solar panel manufacturers and other equipment manufacturers. This helps ensure that the panels they use can be serviced or replaced as rooftop solar systems age. GTM Research’s Module Procurement Trends in the U.S. Residential Market delves into which manufacturers are supplying most solar panels to installers as prices for solar panels grow ever cheaper.
The report found that just a handful of companies provide the majority of solar panels to the US residential solar market, with only two US companies, SunPower and SolarWorld, supplying significant amounts to certain sectors within the residential solar market. However, the GTM Research noted that the residential solar market is in flux as smaller installers are making up a progressively larger portion of the residential market.
“The bankability and staying power of module brands are important to all installers. Installers want to ensure that the module brands they use in installations will be around for a long time and can fulfill their warranty obligations,” explained GTM Research Analyst Allison Mond in a GTM Research Q&A. Mond authored the report. “Therefore, it's important for installers to keep an eye on the financial health of module manufacturers, especially given the way that currently low module prices are squeezing module manufacturers’ margins.”
Module prices continue to decline because of oversupply issues, which has forced prices to spiral lower. This is making is harder for solar manufacturers to compete while maintaining a positive cash flow.
“Installers have always managed ongoing relationships with multiple module manufacturers and distributors at one time in order to ensure that they can execute on attractive pricing opportunities as they arise. This is even more important now as module prices are falling so quickly, and installers want to keep their own costs low in order to stay competitive,” Mond said. She added that installers want to work with PV manufacturers that can be flexible on pricing while staying within range of the rest of the manufacturers in the market.
Mond also explained that large, national installers like Sunrun are looking for different things than the smaller, local installers. “The most important factor in the module procurement decision for large installers appears to be price,” she said. “Smaller installers put more weight on additional factors such as panel efficiency and warranty. This is reflected in the panels most widely used by different groups of installers. Trina is the module brand most frequently used by large installers, with approximately 20 percent of the market, while SolarWorld is the most popular brand with small installers, also with about one-fifth of that market.”
Another interesting factor, according to Mond, is how ownership structure impacts the panels that installers choose. “Customer-owned systems employ a higher proportion of premium panels than do third-party-owned systems,” Bond said. “Among mid-size installers, SunPower panels are the most widely used panels for direct-owned systems, at 35 percent. Hanwha Q CELLS panels are the most widely used in third-party-owned systems, at 27 percent.”Tweet