Solar Power World caught up with Scott Wiater, president of Standard Solar of Rockville, Md., because we wanted him to give advice to entrepreneurs thinking of investing in solar.
SPW: Do you think the solar industry is a good place for an entrepreneur to invest his money?
Wiater: Yes and no.
- Yes, because I am a firm believer that solar is a great investment, especially at the project level, as long as the project is developed and built by people who know what they are doing. Entrepreneur money may be a good type of sponsor-equity at the project level. The industry is going through a churn of consolidations, which makes investing at the company level more challenging, and I would advise investors to make sure they do their due diligence on these investments; and
- No, because the way the Investment Tax Credit (ITC) is set up, you must have a tax appetite to put those credits to work. In many cases, entrepreneur money may not be as efficient as more traditional tax equity. It is the large corporate entities that can most efficiently use the tax credits. Of course, these entities want large scale transactions to make it worth their efforts.
SPW: What do you see as the biggest mistake most small solar installers make when they start their businesses?
Wiater: The solar industry is a relatively new and maturing industry. In this environment, it’s tough for new businesses to find partners that will be around long enough or flexible enough to make good on their value proposition. There are new solar installers that have entered into an exclusive arrangement with suppliers or financers and then realize that their partner is no longer able to support their needs.
SPW: What is the most important piece of business advice you’d give someone just starting out?
Wiater: Stay positive and try to understand the big picture. Keep enough cash reserves to weather the slow times as the solar industry seems to have many highs and lows.
SPW: What changes have you seen in the way installers run their businesses during your career?
Wiater: :The good news is we are seeing installers place more value on quality and following industry best practices. I think this is important for the entire industry as we become more main-stream and compete with more traditional forms of power.
I am a new installer. What has been said here is good advice. However, how do I keep from signing the wrong dotted line, if I don’t know who to trust and whom not to.