There’s a lot of talk about solar electricity, but not many homeowners have made the switch. Here to debunk some misconceptions about going solar is Peter Roth, owner of Solar Wise. They help homes across the US gain access to solar panels. In this episode, Peter chats with Tersh Blissett and Josh Crouch about what people might have gotten wrong about solar panels. He breaks down the benefit of going solar not only for the world but, most importantly, for your wallet. Tune in to learn all about it!
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The Upsides Of Solar Electricity For Homeowners With Peter Roth
We are here at the Service Hero 10X Event. I wanted to bring on Peter Roth here and talk about solar. Most people that are here were talking a lot about HVAC. It’s what most people do that are here, but having that extra add-on with solar is always a cool deal. I love hearing that, and it so happens that a buddy of mine, Vince, is here. He does a little bit electrical and has some questions, so I wanted to bring him on the show too. With that being said, welcome both of you guys to the show.
Thanks for having me.
Thanks for having us.
Tell us, Peter, who you are, a little bit of background, what you’ve got going on, and what is Solar Wise.
I started in the HVAC business a few years ago. The whole solar thing came about because, as the owner, I was also a one-man everything. I wasn’t the technician. That was never my thing, but I was more business and the sales side. I was going into homes, and I was making these sales. People would qualify for financing and get pre-qualified for some large dollar amount. It could be $50,000, $60,000 or $70,000.
Whenever I see $70,000, and then we sell a $6,800 system, I’m like, “What in the heck is going on right now?”
You’re feeling my frustration, which is I’m making this great reputation, this rapport, and building this relationship with this person, and they would probably buy something else from me, but I got nothing else to sell them. Maybe they didn’t want EQ and maybe their ductwork is fine, so there’s no other sale opportunity. I was like, “This sucks. That’s it. I have to leave now, I guess.” I didn’t want to learn the actual installation side, and we still don’t do the installation side. We partner with outside of solar.
You just sell it then?
Yes. That’s my thing. I can talk to you more about that.
Vince, do you have any questions about solar?
I own a few solar panels. We had the same issue. We started in garage doors, and we would get big financing available, so I added three more trades. When I do things, I go all the way in, but I’ve been very curious about solar. One of the big questions I have is who’s the biggest potential customer and how was that being sold to them? Is it somebody that says, “I want to be a big greenie. I want to save the world, so I’m going to buy a solar panel,” what’s that look like?
That’s one of the very first questions when we talk to people, but having done this so many times, I can fast forward that whole conversation and tell you no. It’s just money. It all comes down to money. People want to save money. I can tell you the whole solar pitcher. I can cut it back and make it real simple, but the reality of it is people get sick and tired of paying their ever-increasing electric bills, and in some states, it’s really brutal. California costs $0.30 or $0.40 per watt. With the same bill in the middle of America, the average person spends $100 or $120. California could be $300 or $400 a month, so it’s brutal.
What is the payback period? That’s what I’ve heard is the downside of solar. I can save money on my electric bill, but I’ll be 150 years old before I pay for my panels.
All the questions that I get about solar are valid and outdated. There are a lot of really valid concerns about solar. A lot of people think it’s a scam, that they’re never going to make their money back, or the panels are going to degrade before I use it. These were all, at one point, valid concerns. It’s just that over time, technologies and the industry have improved, so the answer to your question is that ROI is day one. It’s the simplest way to look at it. We’re going to take your electric bill, which is always going up, by the way. We’re going to make that go away, and we’re going to replace it with a solar bill that, in an ideal world, is a little bit lower, or hopefully, a lot lower than your electric bill, and that’s never going to go up, and there’s no down payment.
Do you still have to have battery backup?
Was it called selling it back to the grid?
Those are two different things. A lot of people ask about batteries. They’re like, “Should I get batteries? Do I want to be off the grid?” That’s an important question. Batteries are too new and too expensive, and they don’t work. You’re an electrician, so you can answer this question better, but there’s the starting amperage of certain things and the running amperage of certain things. Whatever the starting amperages of an AC, it’s a lot higher than the panel, so batteries can’t handle that.
It’s because of the influx load.
I guess you can put soft lights.
I’m not an electrician. I own an electric company.
That’s some clarification there. I know you probably get asked this question a lot. Tell me about these shingles.
Before I tell you, can I tell you why this is interesting for people? Otherwise, I think people are going to be like, “This is boring. Why am I listening to this stuff about solar?” Let me explain why HVAC owners, electric owners, plumbing, roofing or any home improvement business should be reading. The reason is because of that original thing that I mentioned, which is my frustration that I got nothing else to sell, and I was looking for something else to sell that I didn’t have to install. I wanted the easy way out that had a lot of money potential. Solar checked those boxes and the reason why was that I found that I could learn to sell solar easily. It’s a simple product. It’s got no moving parts. It’s a panel with an inverter. There are almost no moving parts.
Is that how you got sold then?
When I bought solar? No. I have a farm in the middle of nowhere, and there is no power, so to have a light or a well pump, I had no option. I was an easy sell.
It should be interesting to any business owner or even any comfort adviser because this now gives you an opportunity to have something else to sell and make a ton of money doing it. There are two different ways you can go about selling solar, and I train both.
That’s the whole purpose of Solar Wise, too. You’re training people to do this.
It’s both. It’s a solar company, so consumers can come to me as well, or I can also train other business owners/comfort advisers or anyone in the home improvement sales world. There are two courses of action. One is the easy route where you don’t have to learn the product or the full thing. You don’t have to learn the script. You just make a referral and referral, except that it’s a $1,000 referral. These are big-ticket products, so they pay well. Most people in the home improvement space may not even make a $1,000 commission on their native product, so now, suddenly, they can make $1,000 extra. It sounds pretty appealing.
With that being said, that probably needs to be in a certain geographical area, right?
Yes. We’re in about 30 or 32 states now.
I own an HVAC company. I have salespeople. If I want to do this and I contact you, do you set up my installers as well? What’s that picture look like? I don’t want to go sell it and then go, “I got nobody to put it in.”
It sounds like you asked two questions. What state are you in again?
We’re in Kentucky. All the Southern warm, sunny states, we’re in those for sure. If you’re in a state where solar doesn’t make a lot of sense, but any other warm, sunny state doesn’t make sense, and then to answer your second question, it doesn’t cost you anything. You’re not buying anything. You’re not stocking. As I said, you’re just reselling it. That’s the beauty of it
Do you have installers come and do all the work?
Yes. We handle all that stuff on our end, so you don’t have to. There are two models. The simple route is the referral. It’s $1,000. You flip the client over, and we take it from there. You make $1,000. Option two is if you want to make a lot more money and handle a full transaction, then you’ve got to learn solar sales, and I can train on that too. I can train the whole thing. That’s anywhere from $4,000 to $10,000.
Is this some type of franchise model? If I jump in, are you going to go get 50 other HVAC companies to come in and sell in the same market I’m selling in? How does that work?
This is the first publicity that I’ve had sitting right here, so if someone comes to me, someone comes to me. I’m not exactly going out there pushing this for them. My primary business is in the actual sale itself of solar directly to consumers. I’m not making a huge effort to go out and recruit other contractors.
What’s the average ticket? That’s going to be the first question my sales guys have.All the questions about solar are totally valid and totally outdated. Click To Tweet
I would say anywhere from $25,000 to $50,000.
With option two, where we learn the solar and everything, at that point, are we going to need to develop our own installers?
You’re still going to do the installation, and we are just selling it.
You’re just handling the wholesale process.
That’s simple enough if you already have a specialist that can do it.
What I found is that some of the people start the easy route. They start doing referrals, and then once they start getting the swing of things, they’ll come back to me like, “I think I want to learn the whole kit,” and it’s not hard. It’s one product. Think of HVAC, where we’re selling on a whole kit and this giant array of products. This is just one. It’s like learning a furnace.
How about maintenance? I know that’s going to be a question for clients. Do you have to clean the panels?
There’s almost no maintenance involved. Snow slides right off of them, so that’s not an issue. Sometimes, it gets a little guck buildup from the crap leftover from snow. You can hose it off. It’s nothing. You don’t need anything fancy. You hose it off once every couple of years, and that’s about it.
My biggest fear of putting them on my roof was hail.
That’s one of the old wives’ tales of concern, and it was at one point a thing. The older panels from many years ago weren’t built to those level of tolerances that they are now. We use a video of a particular brand out there called Mission Solar. They’re made in Texas. It’s a pretty funny video where they put them to all kinds of different torture tests, but they go out there with a rocket launcher test.
Do they do it like Tesla where there was this truck, and they threw the baseball at it, and it shatters?
They drive over with a tank, and it’s fine.
At least they didn’t stand in front of a huge audience on live TV and destroy it with a baseball.
They’ll fire a giant hail that’s the size of a baseball.
It lasts a long time, and this is not going to be like the shingle-type things that you hear, like what Tesla talks about.
People think they’re new and fancy. Everyone wants them because they look cool. They don’t look like they have solar panels. The problem with them is that they have no heat dissipation. Solar panels are supposed to stick up a little bit. The heat’s got to dissipate. Otherwise, it kills the efficiency of the unit. With those shingles, the problem is that the heat can dissipate, and all the heat redirects into your attic. Now, your house gets ridiculously hot, and your AC bill goes climbing up, and you’ve ruined the whole purpose of the solar panels.
When you have that whole series of panels up there, how do I know if one of them is not working?
Nowadays, it’s with the inverter technology itself. The brand called Enphase makes what’s called a microinverter. The inverter is on each and every individual panel, so each panel has its own independent inverter. It’s tied to an app on your phone, and you can monitor the whole thing. It tells you the productivity, efficiency and output of each and every individual panel.
You’re in HVAC, so you understand the inverter technology in an air conditioning unit.
I’m on the sales side.
With us having inverters and DC voltage, is there a conflict with having the solar panels and their inverter with the air conditioning’s inverter technology?
I’ve never heard of it in my life, so I can’t imagine that would be an issue.
Sometimes, with some inverter technology, I feel like the smallest, most ridiculous thing is like, “Everybody knows that you can’t do that.”
One thing about it is most HVAC companies never sell inverter technology, but when we offer it, we’re like the only company that offered it when they’ve had ten quotes lying on the table.
The people who were here at this event offered inverter technology. Outside of this event, no.
It is crazy because they’ll almost convince our potential clients that inverter technology is bad. They’re like, “Stay with your two-stage stuff.” I’m like, “Two-stage isn’t bad, but why wouldn’t you want to do it this way?” That’s a whole other rabbit hole.
Most of our competitors don’t even know what two-stage is. They felt like they sowed major high efficiency when they moved to two-stage equipment.
The two-stage technology first came out way back when that was the game-changer for everybody because then it’s like, “This is the solution to humidity.” You have some 16 SEER equipment in that single-stage, and then you have 16 SEER that’s two-stage, and then you get the, “This is a 16 SEER that’s $2,000 more than this 16 SEER,” and then you have to go through the whole technical one. Then their eyes are glazing over, and then you’re like, “I lost you.”
That’s what’s cool about the whole solar conversation, and I train the owners, comfort advisors and sales guys. I train them how to have that natural discussion. It’s a very simple, straightforward, basic discussion. It parlays itself naturally. Do you guys have scripts?
We have a general framework.
I’m a real stickler on scripts. I make guys memorize them down to almost word for word. I’ve got everything scripted out, but it was like what we learned in there. You’ve got to build everything upfront. You don’t want to surprise anyone with anything, and I was like to drop hints throughout the conversation until I’m ready to drop the bomb. We were always talking about solar. In the beginning, we may start light and go, “Have you had any interest in going solar? Is that something you ever had any curiosity in?” If they say no. It’s cool. It’s no big deal. I’ll come back again and bring it up in a different context. I’d be like, “How much are you paying currently for your electric bill?” Whatever the answer is, I’ll be surprised.
Does solar panel installation have to be done by licensed electricians?
Do the guys that you have installing it carry a license, or do we have to have the license?
You don’t have to do anything. You’re just selling it. That’s the cool part.
I’m assuming there are frequent updates on what it costs so that we know how to sell it on proper margins.
It depends. You don’t have to know that stuff if you’re doing referrals. You’re just passing the torch, but if you are doing the sales thing, then you will be trained to understand how to price things effectively because solar is pretty cool. You can sell it for whatever you want. I guess everything is like that in-home services.Solar is the only product where the salesperson can set their own price and keep that whole margin. Click To Tweet
There’s a base cost at some point, like the bare minimum or breakeven, that even your subcontractors are going to come in, and you would have to pay them a certain amount.
Here’s what’s wacky about solar, which is different than any other home services product. It’s that it’s the only product where the salesperson can set their own price and keep that whole margin.
Explain what you mean by that.
Most companies have a predetermined price for a furnace. Very few companies allow their sales reps to go and willy-nilly make up prices.
Even that’s not the norm?
I do know a guy in Louisiana who makes up prices when he goes into sales.
I feel like that’s illegal.
We know that stuff happens all time. It’s no different, but nonetheless, no matter what a rep is selling, he’s only making a commission, and it’s a set commission in advance that has been predetermined and negotiated. They’re like, “I make 10%,” or whatever the number is. They make 10%, and that’s set in stone unless it’s renegotiated later. Solar is different. We know what the cost of the project is. Let’s throw out a number. Let’s say $30,000 is the cost of the project. That rep can turn around and sell it for whatever they want and can keep the difference. You can’t go too crazy because you’re not going to sell anything because your price is so far from the market. You can’t go nuts, but you can sell it for $35,000, $40,000 or $45,000. You have to know your market, and you have to know what the market can bear.
Are there tiers on this? “I want a whole house. I want a partial house. I want options A, B, C or D.” What does that look like?
That’s a simple conversation. All we do is try to offset 100% of your electrical usage with solar panels. If we determine that you use 10 kilowatts of electricity throughout the whole year to power your house, we’re going to put enough panels on your home to provide you with 10 kilowatts.
With some power companies, they’ll pay you for your power.
That’s crap. Otherwise, we’d put every power company out of business if we turn this into a profitable business. That’s a really common question, and the answer is always that’s not how the way things work, because what they do is they’ll sell you the power at one price, and they’ll buy it back at a crap price. They sell it to you that’s usually about half, so it’s not a profitable venture. That’s not the conversation. The conversation is let’s offset and get rid of your electric bill so that it never goes up. It’s locked in at this. Here’s the analogy. The analogy is, “Mr. Homeowner, let me ask you a question. How much did you pay for gasoline when you most recently filled up your car?”
The nice part about owning the business is I write all that stuff off, so I don’t look at it. I think it stops at $75 on the credit card.
Me neither, but I’ll tell you that it’s a little over $3 a gallon. Do you remember what it was about years ago?
It was a lot cheaper.
It was probably around $2.
I remember when I turned sixteen, it was $0.87.
There you go. If you could have locked in those prices of gas years ago, you would have done that, right?
It’s a no-brainer. You would have done that, and that’s what we’re doing when going solar.
It’s a similar conversation Vince and I talked about earlier about having multi-year maintenance agreement plans. If we have a ten-year plan and you pay the dollar amount now, your price will never go up because our maintenance agreement goes up every year.
You can apply that same buying strategy or selling strategy to anything. The problem is that people are bad at explaining it. If you have an analogy that people can relate to, and gas is always one that stings. People talk about gas because it’s expensive, annoying, it takes time out of your day, and we don’t like it, so that’s a good one. That’s why I always use the gas analogy because everyone’s like, “Yes.”
What do we do on a cloudy day?
This brings us to the concept of what’s called net metering. Net metering is fancy terminology for you’re going to operate on a system of debits and credits.
It’s the same thing as when you’re running your dryer at night because there’s no sun out.
The way it works is that your system will produce all of its power for about five hours during the day when it’s sunny. It’s more in the summer and less in the winter, but it’s about on average. It’s going to produce 24 hours’ worth of energy, but you can’t use it all because maybe you’re not even at home during the day. Maybe you’re at work, and kids are at school, so you’re going to use up whatever you’re going to use up at that moment. If you’re running of the dishwasher or whatever the case may be, you’ll use up whatever you use up, and whatever your system overproduces that you haven’t used, it gets sent back to the grid, so your utility is going to hold onto it for you.
This is completely different than the buyback thing that we were talking about.
This is different because what we’re doing here is we’re doing a one-for-one exchange. It’s not in every state, but in most states, it’s one-to-one. What I mean is that for every kilowatt of energy that you produce or that you send back to the grid, they’re going to put one credit on your account.
They don’t count it for peak and off-peak hours.
You get to get rid of that peak crap and there’s not only one level of peak in some states. There are three levels, and when they start climbing, they go crazy. They force you into them, and you can’t get the heck out.
Don’t dry your clothes in the middle of the day. It’s the worst thing.
People are budget conscious, and they end up having to live bizarre lives.
We’re only washing clothes and only doing the laundry between 2:00 AM and 6:00 AM.
In every trade that we’re in, we’re suffering severe supply chain issues. Are we experiencing the same thing now?
Yes and no. By the time this goes live, the answer could change to that. We deal with a lot of different manufacturers for panels. Our general contractor partner is massive, so their buying power is huge. They’re buying hundreds of thousands of panels at once.
If I go out when I get home at 4:00 AM, how long is it going to take before Peter’s crew shows up and bangs that joker out?
That depends on your state. It depends on the permit.
I don’t even know if Kentucky even has this solar permit. I’ve never heard of that.You have to know your market and you have to know what your market can bear. Click To Tweet
I think every state does. The fastest state, I think, is Arizona. Arizona is about 30 days to install. It’s in and out in 30 days. The longest I’ve heard is about 90 days in and out. It’s somewhere around there. I’d say 60 is pretty average.
If I sell this system, I’m most likely going to be financing it. I’m the one collecting the money. How does Peter get paid?
You don’t. All the deals go through our contractor. All the deals get punched in through their platform, and they handle everything on there. You wouldn’t use your typical finance partners or whoever you use. Everything gets punched through the contractor’s website.
With that being said, what if they were approved for $70,000 through service finance, and then they would have to re-run the credit?
There are ways around that. It depends on who the finance partner is. Sometimes we can use them, and sometimes we can’t. Most of the common ones that we generally tend to run into in the HVAC world are service finance because service finance also does solar. Service finance does specifically do solar, so it’s not an issue there.
We started using GoodLeap and had Jason Walker in there to promote it.
GoodLeap is the biggest finance partner in the solar world.
We had some complications with them on HVAC because they were so used to the solar. They’re like, “In solar, it’s 30 to 60 days to get it installed,” and we’re like, “30 to 60 days? Isn’t it 3 to 6 hours?” They’re like, “You can’t do it that fast.” I’m like, “What do you mean I can’t do it that fast?”
Even with GoodLeap, if my guy goes in, we pre-qualify because sometimes, we get them at $100,000. We’re only going to use $15,000 or $20,000, maybe in HVAC, and a lot of times, we’ll try to sell multi-trade. Internally, that extra $70,000 or $80,000, is that going to be a dual transaction then?
GoodLeap is the largest solar lender in the country by far, so that’s the good thing. For them, it’s seamless.
That’s a shameless plug for GoodLeap, I guess.
GoodLeap, feel free to send us money.
They’ve been easy to work with.
I do like them a lot.
Vince approved, so we’re good. We’re sold. Are there any other questions that we did not ask?
I’m trying to think what are the common things that I might hear as far as objections go.
What’s the warranty on that?
We have the best warranty. It’s a 30-year bumper to bumper, which includes labor, and on top of that, it’s separately insured, so if the whole world goes to crap and there’s a massive economic meltdown, and everyone and their mother goes out of business, your warranty will still be alive. The warranty is the best in the business, and clients love it.
How do people get in touch with you?
You can call me, but you can get on my website. It’s GetSolarWise.com. I do the full training from beginning to end. It’s easy. That’s the thing. It’s not hard. If you just want to do referrals, that’s easy, but if you want to learn the whole thing, I do professional staff training, so I’ll get your guys up and running from the whole deal.
Peter, thank you so much for coming on the show, and Vince, thank you for being a co-host on the show.
I’m glad I walked by.
I snagged you out of the crowd. We’ll talk again soon.