At the small, residential scale, there are practically no barriers to entry. There is a wealth of training material available, both in person and online, which enables even a one-man contractor to become certified to install solar.
At the larger, commercial scale, the main barrier to entry is capital, not expertise. According to Coen, there is a national trend towards the financiers owning the solar project, and consultants can manage the project for them and bring together all the necessary expertise to develop a project from the initial site assessment to final commissioning.
The installer model looks a lot like a traditional contractor model. Gross margins are thin, from 15 to 30%, with residential systems typically receiving larger margins than commercial. In the current climate, both see space for a wide range of business models driven by the immaturity of the industry along with a wide diversity and frequent complexity of local codes and utility incentive programs that contractors must negotiate.
There are also advantages to scale. Large solar developers have the buying power to negotiate better prices on solar panels, a significant advantage in a thin-margin business.
Public Solar Installers
Based on the above discussion, I'd guess the sweet spot for a publicly traded solar developer/installer would be a large scale, regional company, focused on a promising region and possibly residential solar installations (because of the higher margins).
Promising markets include California, the Northeast, and Hawaii. The former two have strong incentives, while Hawaii's expensive electricity means that they are already close to grid parity.
Source: AltEnergystocks.com via Renewable EnergyWorld
How I See it in Europe: While it might make sense for installers to acquire other installers in the USA ... in Europe we are seeing interest by major panel makers to invest in commercial solar developers - in order to acquire pipelines of projects and lock in customers for their panels. The additional capital and supplier support give the experienced installer a big advantage in attracting additional investor and bank capital for their projects ... which in turn leads to more installations -- a win, win, win scenario. It's still early days - but there some exploratory discussions we are aware of (not directly by the panel manufacturers ... but through subsidiary distributors and "friends of the manufacturers".
I think it is a smart move ... with inventory levels building ... the bottleneck in the market is financing new construction ... by strengthening targeted installers ... this moves through the bottleneck and leads to more installations and reductions in inventory for the panel manufacturers. The key is finding the right installer for your panels. In our case - we're focused on innovative roofing projects in Italy (i.e., replacing asbestos roofs with brand new roofs composed of amorphous silicon panels ... the result is a long lasting brand new roof -- that qualifies for high feed in tariffs under the newly passed 4th Conto Energia in Italy.
