A growing market with a long project timeline
Solar power has grown rapidly in California because of strong sunshine, community support, declining costs and a renewable portfolio standard, which, as described by the source, requires 60 percent of the state's electricity to come from renewable resources by 2030 and 100 percent by 2045. A good share of that is expected to come from solar. For an installer, a growing market is good news, but each project has a long path from signed contract to final payment.
That path includes design, permit, equipment order, installation, inspection and utility sign-off. Money goes out at the start, and the final payment may not arrive until the system is approved to operate.
Where the cash goes on one project
| Phase | Typical spending |
|---|---|
| Design and permit | Engineering time, permit fees, site visits |
| Procurement | Panels, inverters, racking, wiring and batteries |
| Installation | Crew wages, trucks, lifts, safety gear |
| Inspection and interconnection | Rework if needed, then waiting for utility approval |
Customers often pay in installments tied to milestones, with a final portion due only when the system is permitted to operate.
Panel inventory is a cash decision
Equipment prices and supply conditions change. An installer who buys in bulk may secure better pricing but ties up cash in panels sitting in a warehouse. An installer who buys per project avoids tying up cash but may face delays or higher costs. Neither choice is free, and the right answer depends on the pipeline. Warehouse space, forklifts and insurance on stored equipment are additional costs.
Interconnection delays
After the installation is complete, the system generally has to be inspected and approved by the local jurisdiction and the utility before it can be switched on. Delays in that process stretch the time between finishing the work and collecting the final payment. In the meantime, the crew has moved to other jobs and the installer has paid for all the labor and materials. Installers working in the Inland Empire, the Central Valley, the high desert, the Sacramento region and San Diego each deal with their own jurisdictions and local queues.
Growing a crew
- Hiring installers and electricians before the backlog has turned into invoices
- Adding trucks, ladders and safety equipment
- Sales and marketing costs that precede signed contracts
- Software for design, permitting and customer communication
A worked example, for illustration only
For illustration, an installer signs five residential projects in a month and needs $80,000 of equipment and $25,000 of crew time before the first inspections. Interconnection takes longer than planned on two of the projects. Working capital lets the installer keep ordering for new customers while waiting for the delayed ones to clear. These figures are not our terms or a typical result.
How to apply
If projects are waiting on inspections and your account is waiting on projects, a funding decision based on your bank deposits can help. The application takes about five minutes. We ask for roughly three months of business bank statements and use a soft credit pull; no tax returns are required. FICO 500 and above is considered, funding runs from $25,000 to $5,000,000, and money can arrive in as little as 24 hours. Sole proprietors can apply. Start your application.