How To Avoid Solar Panel Scams | Ask This Old House

foreign hey Kev any good questions from the mailbag fall in your lap I was just reading an email from Brent in North Carolina he's looking to install solar on his roof and he's getting bombarded with ads and he has no idea where to start him and me and everyone else it seems my landscaper is trying to sell me Solo door-to-door in my neighborhood they're coming knocking on the door keep coming inside solar on your roof it's like what is going on so what has changed I mean we're at a really interesting point where we have the cost of solar that has come down to the lowest point ever for an installation okay on top of that we have electric grades from utility companies that are at the highest that they've ever been okay and on top of that we have Financial incentives at the federal state and even local level that's incentivizing solar to be installed so it's cheaper to install solar and people are rushing to it that's right that's right that's right so great for the consumer to get more solar and more Roots Across America but there's also companies that are getting involved that might not be properly trained and you know in it for the right reasons so explain that to me it's just a gold rush because people see a lot of business or a lot of times they're doing it for financial reasons to obtain mean federal tax credits and state renewable energy credits Etc so generally speaking if I pay for solar I'm eligible for a credit on the cost of the solar installation that's right and then there's some sort of ongoing credit the more it gets used over years yeah renewable energy credit right the second type of credit right that's right so those come to me if I buy it but you're telling me that someone could sell it to me at a different way right where the company that's selling it gets those credits that's right yeah so there's four different ways to finance a solar system so the first one is cash right as a homeowner you can buy the system outright in cash I love it it's the best from a financial obligation because you're going to get all of those tax credits you're going to get all those rebates all the renewable energy credits that we talked about and all of the lower costs of the electricity everything goes to you everything goes to you but you pay up front for it right the second best option is a solar loan which means that the asset is still yours but you're getting financing for it from a third party so it's kind of like a home equity loan um where I use at the renovated kitchen I own the kitchen I just have to pay the loan back that's right so I still get all of those credits and Financial it's yours right it's your asset okay it's a great way to go the third option is a solar lease and with that option and similar to a power purchase agreement which is the fourth option they're both very similar in that you are basically allowing a third party to come onto your roof to install solar and they're going to give you a basically a reduction here electric bill in return you have to pay a lease payment and now you've told us about this before and when they do that okay they are getting all of the benefits the tax incentives and those renewable energy credits that go to them that's right and I just get a guaranteed lower price you're paying a lower rate for electricity so I give up some of the total benefits but I don't have to come out of pocket with a loan or cash to buy the thing that's right and you're saying that because that situation exists there are companies who are really just kind of finance companies who are getting into it they're not really installation companies that's right yeah they're I mean there are banks investment banks that are getting involved into the mix and they are seeing this as a way to generate Revenue right because they get rid of energy credits they're getting the tax credits they're getting all that if they can sell you the solar system get all of those tax credits and all those rebates and then they they Pawn that system off onto your roof there's no incentive for them to come back and service it if they have the option to go install a new solar system or go service your failed panel on your roof of course they're gonna most cases they're gonna pick new money new money no money no money exactly so incentives always sort of pervert the system one way or the other you know it's good right it gets people to think about it but I can see why then there's a system to be gamed that's right in that situation and the other thing to keep in mind is that you know with these are contracts that you have to be careful about the fine print in the terms of that contract for example what happens at the end of the lease or the power purchase agreement so in options one and two when you own the asset outright there is not yeah there's no end I just own it you own it but in three and four with at least in with the power purchase agreement and those two options you really have to be careful about it because at the end of that or if you try to sell your house what actually happens right so you got to read that fine print right there all right so um understanding that that's kind of why everyone's getting into it because it's a good time to do it but also the companies how do I decide whether I should get in right now and then how do I decide what company I should pick right so if you have a house that's got a lot of shade right so in a rural setting tall tall trees the roof doesn't get any sun not a good fit right if you have an old roof right if your roof age is extremely old let's say 20 25 years old I would recommend replacing the roof first before you install solar don't put a brand new system on a roof that's going to have to be replaced in the near future that's right that's right so old roof out that's right there is a recent tax bill that has been passed right through legislation recently that allows homeowners to obtain the tax credit for a neutral installation on an old roof so the replacement of the roof and solar installation is all brought into that federal tax credit so the extra cost of replacing the roof is something that you maybe get a credit for that's right so in that situation an old roof might say this is the time to do it exactly okay exactly okay if you're going to be leaving your house anytime in the near term I wouldn't recommend going with solar and that's because you always talk about payback periods you know you have to put the money down to buy it the payback period these things is generally what now so five to eight years is the typical payback okay so if you're leaving the house if you're not gonna be there for five years it doesn't make sense benefit's gonna go to the person you sell the house too right so I mean a perfect installation for solar would be someone that has a really you know new new roof right less than 10 years old they've got really good solar exposure they care about reducing their electric bill they care about the environment if they have got The Upfront Capital to be able to pay for it up front or through a solar loan it's a slam dunk and let's say our friend Brent here from North Carolina is in that situation how does he go about finding the right person to install it yeah so always buy or be aware with any Home Improvement project right so first thing I always recommend is reach out to friends and family people in the community that have gone through a solar installation who do they use right and understand where is that company from are they locally owned right are they owned by a company 3000 miles away and they're conglomerate have they been doing it for two years or ten years right word of mouth still works and do they have to be reputable in terms of like a third party rating or anything like that yeah one of the most important certifications I'm looking for is nabsep which is the nabs a North American Board of certified energy practitioners yeah it's a mouthful but with that they have nationwide PV trainings for solar installations so the guys know what they're doing up on the roof right so you know what they're doing and if they don't have that certification like should everyone have it across the board it would be great if everyone had that but you know if they don't it's not doesn't mean they're not a good installer you just to do more research and dig a little bit deeper a little deeper good all right well I think with all that information our fella Brent here has probably got a good lay of the land great question yeah great question yeah I think he's going to be very grateful for the information all right thank you Ross thanks for watching this whole house has got a video for just about every Home Improvement project so be sure to check out the others and if you'd like what you see click on the Subscribe button to make sure that you get our newest videos right in your feed

Channel: This Old House

Views: 122,472

Keywords: This Old House, Home Improvement, DIY, Construction, Ask This Old House, Building, solar energy, home finance, budget, Ross Trethewey, Kevin O'Connor

Id: IGZHLim6_DU

Length: 6min 53sec (413 seconds)

Published: Mon Nov 07 2022

Reddit Comments

[u/Altruistic_Maybe_270]

🚩🚩🚩Posted selfie of her in bed “Ask me more about solar energy”🚩🚩🚩🚩

As a consumer, I would NEVER be interested in buying something from anyone who posts selfies from their bed all day long.

[u/RedditModeratorADMlN]

Looove this Old House, they make things simple for the lay person. This is an easy, understandable explanation of how leasing works, but 3rd/4th option (the scam Piss is looking to exploit... P.S. FUCK YOU MARISSA) is what to pay close attention to. Solar is rife with scams recently, it's the new orange strip... watch her pilfer this renewable energy very soon.

Send this to anyone she reaches out to, inform your friends that may be looking in to solar options!

[u/Possible_Ad_5989]

Soooo I took one for the team and reached out to the company and these are the kinds of messages you will get when you just stop responding lmao…

https://preview.redd.it/g9wxkv4jctz91.jpeg?width=960&format=pjpg&auto=webp&v=enabled&s=8e3b574450bf19a029012f9294c378420078fb9a

[u/Such_Ad4514]

She’s so weird lol she fails to realize the perks she’s using to try and drive sales don’t benefit everyone, especially the tax benefits…

[u/nevahail]

I heard "properly trained" hahahahahaha Piss got a google certificate and does that cold calling that we all hate those scam calls