What Legal Considerations Should Contractors Keep In Mind When Selling Solar Plus Storage Systems? Posted on Apr 23, 2019
The emerging solar plus storage market is expected to grow exponentially over the next decade. Last year, California’s most active state solar trade association changed its name from the California Solar Energy Industry Association to the California Solar and Storage Association. Across the nation, battery storage systems are becoming an integral part of the solar energy system design. As a result, sellers of these "solar plus storage systems" must not only stay up to date on the latest industry trends related to solar plus storage, but also the evolving legal considerations of selling solar plus storage systems.
For installers of solar plus storage systems, the standard Solar Installation Agreements for residential and commercial solar energy systems can typically be used with some key modifications. In addition to including sections that cover the battery storage component and a modified scope of work for the installation and design, Solar Plus Storage System Installation Agreements should include specific sections covering the contractor’s estimation of the savings potential of the battery. Important considerations with regard to these estimations of the battery savings potential include: 1) how they depend on electricity/TOU rate changes over time, 2) how well the batteries perform including the underlying intellectual property associated with them, and 3) how accurate the seller is in estimating the savings. Solar Plus Storage System Installation Agreements should also include specific disclaimers regarding estimates of the savings potential of batteries. A change of law risks section should address any changes in applicable laws, which are a bigger issue than for “solar alone” systems since storage is a relatively unproven technology and changes in regulations and local policies could impact the installation and how the utility interacts with systems. These types of disclaimers and protections for the sellers of solar plus storage systems can be more critical for commercial projects given the larger size of the risks and negotiating power of commercial customers.
Additionally, companies that sell solar plus storage systems must remain vigilant about staying up to date on potential changes in contractor licensing and other applicable laws. Regulators and state policy makers are analyzing the rules and policies related to solar plus storage as the market evolves. For instance, in California, the IBEW is lobbying hard to have the Contractor State License Board require a C-10 electrical contractor license in order to install a battery system for solar. Currently, C-46 (Solar) and General (A&B) contractors in California can install battery systems for solar. Additionally, a significantly larger amount of work and time is involved for companies in California to get state rebate money for storage so contractors must be careful about planning their business decisions around receipt of the state rebates.
To help companies stay up to date on the legal issues related to solar plus storage, we will soon be adding webinars on this important to our site.