US Solar Permitting Process Rife With Inefficiencies, Limits Growth

Over the past year or two, we’ve written a lot about the drag that solar permitting processes is having on the growth of the industry, and the efforts to bring those costs down.

Now, a nationwide survey of solar installers provides more clarity to the situation. Antiquated and complex permitting processes are limiting adoption of residential solar and discouraging installers from expanding into new territories, according to a survey by Clean Power Finance.

Gathering permits for a home solar installation can often involve working with as many as five different agencies in some regions, they say. 

As a result, at least one-third of US installers have decided not to expand into certain regions, which is limiting potential adoption at a time when interest in residential solar is growing quickly.

Clean Power Finance conducted a nationwide survey of 273 residential installers as part of developing its National Solar Permitting Database. The online resource that will detail US permit requirements is partially funded by a grant from the Department of Energy’s SunShot Initiative.

11% of the time, municipalities haven’t even decided on a  process for solar permits. And it takes an average of nearly eight work weeks to complete the permitting process. That’s a huge drag on cash flow for solar installers, who often have to buy equipment upfront, as well as resulting in higher costs for consumers.

"The study puts real numbers to what all installers have been feeling: permitting is an albatross around the industry’s neck," says Patrick Redgate, CEO of Ameco Solar, based in Southern California. "Clearly, not all cities are bad, but we need to call out the ones that are particularly problematic.” 

Solar permitting and inspection costs add $0.50 per watt, or about $2,500 to the total cost for the homeowner. Major contributors to this are incomplete paperwork, high staff turnover, and limited municipal budgets, says Clean Power Finance.

Bringing these costs down is a strong focus for DOE’s SunShot program, and the database being compiled by Clean Power is intended to help streamline the process.

Clean Power Finance is one of the biggest US solar leasing companies – its $300 million fund announced in May 2012 is one of the biggest ever.

The free database relies on input from solar professionals and municipalities, which are encouraged to submit permitting information covering the areas in which they operate.

The prototype is up and running, but an official launch date hasn’t yet been announced.

The need to address residential permitting is becoming more acute, as rooftop and distributed installations account for an ever-larger portion of US solar capacity added each quarter.

In fact, residential solar installations hit an all-time quarterly high in the third quarter of 2012, growing 12% to 118 megawatts.

Here are the survey findings:

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