On Monday, the White House announced Trump was putting a 30 percent tariff on imported solar cells and panels to retaliate against China’s efforts to corner the world market. Since some 80 percent of panels are imported, it’s hard for either consumers or businesses to avoid this new Trump tax.
For Americans considering a shift to solar power, the new tariff is likely to raise the cost of a typical residential solar system by nearly $700, according to one analysis (see below).
The good news is there are now online price quote aggregators — think Hotels.com or Expedia or Lendingtree, but for solar — that can lower the cost of a new system by much more than Trump’s new tariff raises it.
Fortunately, back during the Obama administration, the Department of Energy began supporting efforts to help consumers lower the price of residential solar photovoltaic (PV) systems through online price quote aggregators, like EnergySage and PickMySolar. Aggregators let consumers quickly compare bids from multiple solar contractors (see figure above).
Last fall, the National Renewable Energy Laboratory (NREL) completed a study, “The Value of Transparency in Distributed Solar PV Markets,” which confirmed that giving consumers more choices and having more solar installers compete for the job results in lower prices.
“Most solar customers get very few quotes for a new PV system — one, two, maybe three,” lead author Eric O’Shaughnessy explained in an interview. Aggregators can get customers six or more bids and compare them directly, while providing information on each contractor and the equipment they are proposing to use.
NREL studied data from the largest solar aggregator, EnergySage, and, concluded, as O’Shaughnessy put it, that “installers offer lower prices when they know that customers receive more quotes.”
Overall, NREL found that the quote aggregation was saving consumers on average about 8 percent, which is a savings of $0.32 a watt on a $4/watt panel. This might not seem like much, but a typical home PV system these days is 6 kilowatts or 6000 Watts. That means quote aggregation might save you over $1,900.
Vikram Aggarwal, the CEO of EnergySage, explained in an interview that while “we wish there were no tariffs,” the company had calculated that, using its quote aggregation system, a consumer could save more money than the tariff would cost them.
The company made this chart, which takes into account the fact that the solar module is only a portion of the total equipment cost, and the equipment is only about half of the total installed system cost:
They calculate that while the new tariff might add $660 to a $19,000 system, quote aggregation would then save you some $1,440 — far more than the tariff added.
Ironically, whether or not people use the quote aggregators, Trump’s new tariff won’t actually hurt China very much. But the price hike will hurt both U.S. consumers and businesses, while risking tens of thousands of good paying jobs for solar installers. What’s more, it will disproportionately hurt the workers and consumers of the emerging solar markets in red states like Florida, Texas, South Carolina, and Georgia.