Production guarantee is the single most important protection you can get for your solar system and is almost never talked about. Why? Because most companies do not want to be liable for it. So why is it important and what does it do? A production (or performance) guarantee ensures that your solar system produces the electricity that was promised at time of sale.
Many solar installers will overpromise what your solar system will generate, by showing you exaggerated savings and production outputs which will likely increase their chances of making a sale. And when your solar system doesn’t deliver what was promised, you’re out of luck, and can cost you tens and thousands.
Imagine this scenario. You are buying two identical cars and are getting quotes from two dealerships. One costs $30,000 and the dealer will guarantee that the car will run for at least 150,000 miles or will fix your car for free if it doesn’t. The other dealer charges $30,000 but has no such guarantee.
Production guarantee is no different. All solar contractors will provide you with a quote that states how much you will save over 25 years, and in Southern California that is ~$109,120. But what if it wasn’t engineered or installed properly? What if a shading study wasn’t conducted to determine if shading or roof orientation to the sun will impact its production.
Financial impact of not having a production guarantee can be enormous. On average, a solar system is expected to miss it’s “quoted” production by 18% or more. On average savings of $109,120, that is a staggering $19,642 in missed out opportunity. There is no question you still saved a lot of money, but that is almost the cost of the entire system itself.
A proper production guarantee will outline the following:
- Clearly defined schedule as to the electrical output (in watts) of your solar system.
- A schedule listing out the reimbursement value per watt if your solar system underproduces.
- A guarantee to replace or fix any components not working to ensure production is met.
So next time you consider a solar system, ask for a production or performance guarantee. Without it, it’s like buying a car without the assurance that it will actually run.
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