Who Buys Sun and Why

What kind of a saintly person is willing to wade through the decision-making complications and spend the big upfront money it takes to put a solar system on the roof?

The answer is Innovators and Early Adopters. After them, there will be an Early Majority. These terms come from Everett M. Rogers’ Diffusion of Innovations.

There is one thing important about that Early Majority: If it starts buying solar soon enough, the community of nations may have a shot at restoring this good earth’s steady-state climate. So it is crucial to understand what drives the Innovators and Early Adopters and what needs to change to convince the Early Majority. ::continue::

To better understand the solar buyer, the Solar Electric Power Association (SEPA) designed an online survey and obtained data in the fall of 2007. Photovoltaic Incentive Programs Survey: Residential Participant Demographics, Motivations and Experiences had 2 specific goals: (1) To get answers for state utilities and incentive program designers and (2) to obtain data that explains how and why one part of the public sees a good thing and gets involved and another part turns away and waits.

The survey is broken into 5 sections: (1) The demographics of solar customers; their attitudes and experiences (2) in the Pre-Installation period, (3) in the Installation period, and (4) in the Post-Installation period; and (5) their Financial Considerations.

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The survey revealed patterns: Demographically, solar customers very much resembled the Early Adopters described in Diffusion of Innovations theory.

More specifically, the 3 top concerns of these Early Adopter solar purchasers prior to installation were the quality of the equipment (17%), the initial cost (14%) and finding a qualified installer (14%).

Early Adopters’ 3 top motivations for purchasing a solar system were environmental concerns (24%), cutting back dependence on foreign oil (20%), and producing their own electricity (20%).

The 3 most common methods for paying for the systems, after incentives, were cash (67%), home equity loans (21%), and mortgage refinancing (8%).

The 3 parts of the process they found easiest and most positive were getting utility approval (19%), getting the payment through the incentive program (19%), and getting information about solar energy (18%).

The 3 parts of the process that were the most difficult and negative were getting utility approval (25%), getting through the installation (24%), and getting the payment through the incentive program (17%).

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The bottom line: PV system Early Adopters are in a higher income bracket, have a post-graduate degree, live in a smaller household, and are aware of and concerned about the environment and solutions. In short, they are a niche market. Whereas…

The anticipated PV system Early Majority will have a more median income, median education level and median household size. It will be more wary of new technologies and more risk averse. It will worry about system maintenance and whether the system will perform as marketed. Therefore…

To achieve higher levels of market penetration, the solar industry must meet these changing concerns.

The Early Majority will want and require straightforward and reliable information on solar technologies presented by qualified, personable, informative installers. Good websites that provide customer reviews will also help move the marketplace.

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To win over the Early Majority, the solar industry must also sell reliable systems that fulfill the promise of low maintenance. It must make grid connection and incentive applications simpler and it must make the presentation of its information simple, realistic and comprehensive. There must be no hidden costs and all aspects of financing and payment must be clear.

In short, the Early Majority customer will require a seamless process overseen by an installer they can trust.

The survey’s results reveal much about customer motivations, concerns and experiences before, during and after a PV system is installed. Because the field is so new, the data will at least provide a baseline for future surveys. SEPA believes the data will be useful in designing incentive programs to drive solar industry growth.

Most importantly, the data reveal that short- and medium-term marketing and incentive programs should be directed at Early Adopters and designed similarly to marketing for environmental products (hybrid-electric vehicles, organic foods). In the long-term, however, the solar industry will only achieve a bigger market position by making solar more understandable, affordable, and accessible and reaching customers who are not willing or able to overcome information and/or cost barriers by themselves.

Right now, the saintly people who go through the tribulations of installing a home solar system do so because they believe. The market the solar industry needs will need to be convinced.

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This post is based on Photovoltaic Incentive Programs Survey: Residential Participant Demographics, Motivations and Experiences by Yasmeen Hossain, Mike Taylor and Ming-Jay Shao, published in November 2009 by the Solar Electric Power Association.

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