Solar Panels in Bulk: Savings for Group & Community Buyers
Imagine what a community could do with the savings of solar energy. Photo Credit: SAIC
The deal keeps getting sweeter on home renewable energy systems. Local, state, and federal incentives can reduce end costs by well over 50 percent. As the solar power movement continues to gain in popularity (while falling in price), more homeowners are discovering that a growing number of their neighbors are also interested, as well as their neighbors’ neighbors and so on.
This growing community of solar enthusiasts has spawned a movement of its own: group buying. As any grocery store veteran will attest, it’s nearly always cheaper to pay for food by the pound versus out of the box. That’s because bulk products are cheaper to produce.
The same principles of bulk purchasing apply to solar panels, and result in savings for…
Say 20 members of a neighborhood get together and decide to purchase all of the equipment for their new solar electric system at once. The supplier of these panels is then able to deliver 20 rooftops-worth of solar panels to one location, rather than making 20 trips to 20 different homes at 20 different times. This saves that supplier transportation and labor costs - savings which are passed on to the group. It also further lowers the carbon footprint embedded in the solar installation by way of lower fuel emissions.
Savings also show up for the installer, who is able to show up in one neighborhood and quickly jump from roof to roof. This offers the security of several short-term projects transformed into one long-term project. It undoubtedly increases the speed of the installation, as everything is centrally located, there is no travel time, and a certain rhythm can be established.
Of course, the ultimate beneficiaries are the homeowners within the group. After negotiating a lower, bulk rate on the equipment, the initial cost of the system drops dramatically, which in turn results in more immediate savings and a faster payback period.
One need only look at commercial-scale solar installations for proof of the benefits in group buying. The average price of a residential solar system (before government incentives) is $7-10 per watt installed. At the same time the average price of a commercial system is typically about $5-6 per watt. How is one so much cheaper than the other when both are using the same solar panels? Because the latter is buying in bulk. It’s the simple rule of economies of scale, and with some organizational effort, many neighborhoods and communities across the country are taking advantage of that rule.
To sweeten the pot even more, there are actually organizations and companies out there that are encouraging and helping communities to go solar as a group. Neighborhood Solar and One Block Off The Grid (1BOG) are two successful examples. SolarCity is another renowned pioneer in the group buying and full-service solar movement.
Working together, there is no reason why most communities shouldn’t achieve solar power. In the same way that collective bargaining lands union employees higher wages, collective purchasing will get homeowners lower prices on solar.
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