Grounded: Will Licensing Requirements Banish Solar Contractors?

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Written by Nora Caley
on September 11, 2013 No Comments
Categories : E-Features

Some solar installers might find that they need more than expertise to remain competitive. Some states have changed, or are proposing to change, rules about who may install solar.

In Hawaii, the Contractors Licensing Board recently proposed changing the rule about solar installers and electrical contractors. Hawaii's Department of Commerce and Consumer Affairs offers several licenses for solar contractors. There's the solar power systems contractor (C-60), solar energy systems contractor (C-61), solar hot water systems contractor (C-61a), and solar heating and cooling systems contractor (C-61b).

A solar power systems contractor typically installs the solar panels and subcontracts the electrical work to an electrical contractor (C-13) to handle the grounding and connect the photovoltaic system to the electrical system. In August, the Honolulu-based Pacific Business News reported that the board was considering eliminating the C-60 license, and only electricians with a C-13 license would be allowed to install solar panels. The board is not saying anything, and will address the topic at its October 15 meeting.

For installers in other states, the topic might sound familiar. In June, the Massachusetts Board of State Examiners of Electricians announced enforcement actions against two companies to resolve allegations that they were performing unlicensed electrical work. Patriot Solar, which is based in Albion, Mich., was found to have engaged in ‘the installation of metal posts, trusses and cross beams making up the racking system of a photovoltaic installation’ on a Southbridge, Mass., property from September to November 2012. CND Temp Agency Inc. provided unlicensed laborers to Antiveros Construction Inc. of North Carolina to install racking on a project in Canton, Mass., in February 2012. Patriot and CND were each fined $1,000.

The National Electrical Contractors Association of Greater Boston (NECA) initially filed the complaints against these two companies. NECA, which calls itself ‘the voice of the electrical contracting industry,’ has been active in exposing unlicensed solar work. The definition of unlicensed solar work was clarified by the 2012 court decision in Suffolk Superior Court in the case John Carroll, et al. v. Massachusetts Board of State Examiners of Electricians C.A.
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In a guidance letter explaining the case, the Board of State Examiners of Electricians noted that the court recognized that, among other details, general contractors who install PV projects must subcontract with licensed electricians to perform electrical work on those installations. The board interpreted the relevant Massachusetts General Law and the Massachusetts Electrical Code to mean that ‘frames, racks, rails and modules must be assembled and installed by a licensed electrician,’ but that other workers may drill holes in a roof and attach footers to a building structure.

In Hawaii and Massachusetts, installers and others in the industry lamented that the rules would add costs to PV installations and make their companies less able to compete. Not so, says Jim Bride, president of Energy Tariff Experts, a consulting firm in Cambridge, Mass. In a blog post in May, the firm wrote that it had examined the Massachusetts list of solar installations that qualified for the solar carve-out as of March 13 of this year. The group found that for small projects, electrical contractors offered a cost advantage compared to solar developers.

‘A lot of electrical contracting firms have business models that are based on labor utilization,’ Bride says. ‘The unit cost per hour of labor is higher, but they tend to be very efficient, well-run firms.’

Energy Tariff Experts noted that in 2012, electrical contractors had a $0.28 per-watt cost advantage in residential systems up to 10 kW and a $0.15 per-watt advantage in medium size commercial systems sized 25 kW to 100 kW. According to the blog: ‘Once installation sizes cross the 100 kW threshold, solar firms regain their cost advantage, and this advantage becomes significant in installations above 500 kW in size. The larger systems require economies of scale and really require sophisticated engineer, procure, construct capabilities.’

Other states offer a choice. In Florida, ‘A license is required to contract for the installation of a photovoltaic system,’ says Beth Frady, deputy communications director for the Department of Business and Professional Regulation. ‘Photovoltaic systems must be installed by a licensed solar contractor or a licensed electrical contractor unless specifically exempt by another provision of law.’

Patrick Altier, vice president of the Florida Solar Energy Industries Association (FlaSEIA), says roofers and electricians both should be able to install solar.

‘Limiting the trades that can install solar limits choices for the consumer, therefore driving up prices,’ he says. ‘The more cost-effective solar is, the more solar is installed. This benefits all Floridians.’

Nora Caley is a freelance writer based in Denver.

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