Solar Economies of Scope through the Intersection of Four Industries: PV Installation, Electrical, Construction, and Roofing

The U.S. solar photovoltaic (PV) installation industry largely grew from pre-existing industries that provide related services such as electrical contracting, construction, and roofing. In this report, we use a new data set based on data from the California Contractors State License Board (CSLB) to explore the ties between PV installation and these related-service industries. Based on a study period of 2010 to 2016, the CSLB data show that most PV installers hold some license other than the license designed specifically for PV installation, primarily electrical and construction licenses. Indeed, only about 9% of PV installers hold only the solar contractor license. The fact that most PV installers hold electrician and construction licenses illustrates the important ties between PV installation and these industries. The CSLB data, combined with residential PV price data, also show that installers with multiple non-solar licenses are associated with lower-priced systems. These findings suggest that installers with multiple skillsets may be able to reduce PV installation costs. Further, the data show that PV systems are lower-priced when installed during new construction, especially when new-construction systems are installed by licensed roofers.