Bankability: What it Means and Why it is Important for Your Solar Project
Homeowners who are considering solar typically overlook the manufacturer of their solar panels, despite this being one of the most important factors for the longevity of a system. Manufacturers provide long warranties, typically 25 years; but these warranties are worthless if the manufacturer goes out of business. Many PV module firms, most notably Solyndra, have gone bankrupt in the past decade while others have had considerable success with quality products. Homeowners are far too often sold poor quality solar modules simply because they are not presented with the information necessary to make an intelligent purchase. So how does a prospective solar owner know which solar panel to buy? One key metric to consider is the bankability of your solar panel manufacturer.
For example, say you purchase a solar PV system from a “top” solar installer, but they are providing you with panels from a Tier 3 manufacturer. Typically, the contract will provide for a 25-year performance guarantee from the panel manufacturer and a 10-year workmanship warranty from the installer. If the panels fail due to faulty wiring in year 12, but the Tier 3 manufacturer went out of business prior to that, then you are out thousands of dollars with no one left to stand behind your product. This scenario has happened time and time again in the solar industry. Some major industry players like SolarCity do not show you the manufacturer of the panels they give you. Homeowners become reliant on the word of their installer, rather than perform their own due diligence on the hardware they are buying. This would seem unthinkable in an automobile purchase, for example.
How can homeowners protect themselves from potentially problematic panel manufacturers? Start by demanding that your installer use Tier 1 panels. These are panels which have demonstrated “bankability” in the past two years. That is, multiple lenders have demonstrated significant confidence in the quality of these panels and in the manufacturers which produce them, and that they will be around to honor any warranties and guarantees. Some panel manufacturers such as SolarWorld, LG, and Hanwha have taken out insurance policies that guarantee their warranties will be honored even if the firm cannot.
Recently, solar module testing firms have entered the market to better determine panel quality and assess performance in different environments. Manufacturers are catching on to the fact that quality is king in the solar market. When choosing the panels for your roof, make sure you ask your installer for the bankability tier of the panel manufacturer you are considering. Also, search online for the latest testing data for these panels in your geographic environment. At Solar.com, we assess all the panels we use for quality and bankability to make sure our customers are using the best and most dependable solar products offered by companies which will be there to back them in the long run.