Why Do So Many Solar Companies Fail?

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Over the past decade, the solar industry has boomed. In 2018, the number of Australian households with solar PV installations reached 2 million. That’s an average of six solar panels installed per minute!

The solar industry is growing rapidly, yet there are many solar companies who have left. ABC News reports that more than 700 solar companies have gone out of business since 2011, leaving around 650,000 Australians without warranties if their systems fault. These systems are referred to as ‘orphaned’ systems, because there is no longer a company available to take responsibility. 

So, how is it possible that so many solar companies have shut down in an industry that’s booming?

Why Solar Companies Go Out Of Business

There are many reasons a solar company might shut down. One of the biggest reasons is how they handle claims against their products. Cheap prices conceal what is really happening under the surface – subpar business practices and poor management.

It could be said there are two types of companies. The first are those who face adversity, doing everything in their power to rectify product complaints. The second are those who when facing such claims about their products, are unable to rectify the problem. The second company type is more likely to go out of business because they continuously overlook customer complaints.

Additionally, if the company uses low quality, cheap solar products, the chance of going out of business further increases. This is because cheaper systems fail at a faster rate, in turn, leaving the company with a magnitude of failed systems at once. This can place stress on the company’s resources, causing a business to shut down due to increased pressure and the inability to deal with the problem correctly.

At this point, it’s easier for a business to declare bankruptcy instead of replacing a large amount of failed solar systems. When this happens, existing customers are left with few options and are forced to write off the failed system, starting fresh with a new company.

This situation is all too common, not just for solar, but for many companies that operate in different industries. Thankfully, it’s possible to prevent by choosing a stable solar company and avoiding cheap products at all costs.

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What Consumers Need To Know

If you are looking to install solar PV or Batteries, it is important to make sure you select a reputable solar company who has years of experience in the industry. 

You can do this by undertaking research to help you seperate the good from the bad. Ensure the office address is a legitimate location, look at online reviews to see how they handle complaints and confirm they have been in business for more than five years.

As a consumer, the most important decision you need to make is what solar company you will trust to install your solar solution. 

We are proud to say that Westsun Solar has over 10 years experience. Our customers can rest assured knowing their solar needs are in the hands of experienced solar professionals. As experts in the solar industry, we have a range of products suited for varying needs and requirements. If you would like to learn more about our current offers, give us a call on 08 9303 9810.

Why Westsun Solar Believe Companies Come And Go

→ Solar Panel Installation is the weakest link when it comes to most solar installation issues. Rushed, underpaid contractors and a number of bad installation practices cause systems to fail and in some cases catch on fire. 

→ WATER! This is not a solar systems friend. As we all know water can get into anything. If the Solar System installed is not completely waterproof or installed correctly, cheap installs over time will begin to break down and water works its way into DC Isolators and roof spaces causing severe damage. This can happen over a long period of time resulting in very expensive repairs bill, often after the company has gone bankrupt leaving you to fix their mistakes and a system that no longer works.

→ A cheap Solar System is usually made cheaper by reducing the costs of the installation process. This not only allows for corners to be cut, but inadequate funding for each job to be completed on time and in a proper manner leaving the customer with a system that is a ticking time bomb to fail. 

→ The most common reason for Solar Panel failure is earth faults. This is caused by cheap panels and backing sheets being broken down over time due to temperatures and weather changes. This causes electricity to leak through panels on the railing structure through to the earthing system resulting in a failure and system shut off. This can become costly and quite difficult to find. In most cases all panels must be removed and disposed of and replaced due to the high cost of labour. 

→ Roof Leaks – If Solar Systems on tile roofs are not installed properly both minor and major roof leaks can occur. Companies that are willing to repair these leaks ASAP and take their time to ensure the system is installed correctly will outlast those who don’t. Many companies choose to put their head in the sand when roof leaks are brought to their attention and often dig a hole they can not get out of without constant return visits and insurance bills they cannot keep up with. Many companies also blame the installer that they are sub contracted to or are not motivated to return to site to resolve the issue. This results in in a lag time to repair systems, resulting in major home repairs that these solar companies refuse to pay leaving the customer in an awkward position going back and forth with sub-contractors and the company they purchased their solar off. 

→ Equipment – Buying equipment from a company that has been around long enough to understand warranties and failure rates is very important. Systems that fail constantly and require numerous visits generally hints that the company is not being ran properly. If a company has been around for more than 10 years that is a pretty good indicator that they understand solar products and warranties pretty. The system that you purchase should last you between 10-25 years. When purchasing your solar ensure you do your research on the company you decide to go with, it is important that they can guarantee they have a backend that will follow through with warranties and services down the track. 

→ Our philosophy: ‘buy once buy right or buy cheap buy twice’. 

Click on the link below to view the list of bankrupt Solar Companies

List of Bankrupt Solar Companies