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May 13, 2024

How Commercial Solar Drives Residential Demand: Part 1—What a New Study Says about Non-Residential Solar

New research conducted by Lawrence Berkeley National Laboratory suggests that non-residential solar installations have a significant influence on residential adoption decisions.

By: Emily Silverman

Commercial solar

Have you ever felt compelled to buy something for your house because someone you know bought one for theirs? Maybe you installed a smart home security system because every other house on your street had one. Or maybe a neighbor told you about their amazing new heat pump, so you installed one, too.

This is called social influence, and it happens all the time, especially with solar panel installations.

For the past decade, researchers have been studying the social influence of solar panels, but their focus has always been on the influence between households. New research conducted by Lawrence Berkeley National Laboratory, however, suggests that non-residential* solar installations also have a significant influence on residential adoption decisions.

At Energy Circle, we spend a lot of time thinking about the best ways for solar installers to grow their residential leads, which usually involves marketing directly to homeowners. This new research is interesting because it suggests that there are additional strategies installers can implement to grow their residential solar leads indirectly. If you currently focus your marketing efforts primarily on the residential side of your business, shifting some focus to commercial jobs may ultimately drive more residential work.

*Contractors often separate their services into two main categories: “Residential” and “Commercial,” using the latter as a catch-all for everything that’s not residential. So, if you see the word commercial used in this article, know that we’re not just talking about purely commercial businesses.

How Non-Residential Solar Impacts Residential Adoption: Key Findings from the Study

To conduct this study, researchers at Lawrence Berkeley National Laboratory measured the association between the time when a non-residential solar panel system is installed in a given zip code and the time when a household in that same zip code decides to install solar panels.

Here’s what they found:

  • Results suggest that solar installations on non-residential buildings (including commercial buildings, government buildings, schools, and houses of worship) influence residential solar adoption decisions.
  • For every non-residential installation within a given zip code, there is a statistically significant increase of approximately 0.4 additional residential installations per quarter.
  • Non-residential installations exert a continuous, long-term influence on residential adoption decisions. This suggests that non-residential solar installations can start a cascading effect.

What Are the Implications for Solar Installers?

Non-Residential Solar Installations Could “Seed” Residential Installations

The piece of this research that we find most interesting and impactful for solar installers is the idea that non-residential solar installations could be used to create what the researchers call a “seeding” effect in a particular community. What this means is that the initial “seed” installation on a non-residential building in a particular community will generate interest and ultimately “sprout” residential jobs within that same community. By marketing commercial solar to specific organizations within a chosen community, you can grow leads in the geographical areas that are most important to your business.

Certain Types of Buildings May Be More Influential than Others

For the purposes of this study, researchers looked at a variety of non-residential solar installations, including those on commercial buildings, government buildings, schools, and houses of worship. They found that all types of non-residential solar installations had a similar, positive impact on residential adoption. However, they hypothesized that certain types of buildings may be more influential than others.

Values-based organizations, like schools, churches, and other non-profits, can influence their constituents’ behavior, which could make it easier to amplify the seeding effect.

Andreas Karelas, Founder and Executive Director of RE-volv, a non-profit that helps other non-profits go solar, talked about his on-the-ground experience with the seeding effect during a recent webinar about the Lawrence Berkeley study. Karelas says, “If we put up solar on non-profits that play a vital role in their community and that are visible, and add to that this active interaction where we’re engaging community members and providing them with resources, then we can help amplify that seeding effect.”

The Seeding Effect in Action

RE-volv has been helping non-profits go solar since 2011. They’ve gathered plenty of anecdotal evidence to support the seeding effect, which they shared on the webinar.

One example is the Kehilla Community Synagogue in Piedmont, CA. Before and after installing its 22 kW solar energy system, which was crowd-funded, RE-volv helped the Synagogue’s leaders host what they call “solar education events.” These are simple weeknight events hosted at the Synagogue, during which a representative from the local solar company that installed its solar system delivers a presentation about the benefits of solar for homeowners to members and answers their questions.

According to RE-volv, this strategy is successful because it builds upon the trust members already have in their Synagogue. Rather than marketing to homeowners whose trust you need to earn, you have a captive audience of homeowners who already trust you because their Synagogue has corroborated for you. Synagogue leaders have also softened their members’ attitudes toward installing solar panels by speaking about their reasons for going solar in a way that resonates with their members’ values.

Another example from the St Thomas of Canterbury Episcopal Church in Albuquerque, NM, illustrates this point well. During the same webinar discussion, Karelas shared a comment from a church representative saying:

“We are called by God to be faithful stewards of the creation with which He has entrusted us. We have responded to that call by taking steps to reduce our own energy consumption, including the decision for a solar installation that will not only minimize our reliance on fossil fuels and cut our greenhouse gas emissions but will also serve as a visible witness to the surrounding community of our commitment to sustainability.”

This is a powerful statement that will resonate with members of the church who share these values and may feel called to act on them by installing solar panels on their own homes.

Part Two: Initiating & Amplifying the Seeding Effect

This research caught our attention because we believe solar installers throughout the country can use the results to their advantage. In Part Two of this series, we’ll explain how solar installers can strategically initiate and amplify the seeding effect within their service areas to increase residential leads. Stay tuned for actionable insights that will help you harness the power of social influence and turn your commercial installations into residential lead-generation engines.

This article was originally published in the Energy Circle blog and is republished with permission.

Emily Silverman
Energy Circle Content Strategist

Emily has many years of experience as a content writer and strategist in the better building industry. She joined the Energy Circle team in 2020 after spending some time working as a freelance writer while traveling through Southeast Asia. She's now living in Florida and is a remote member of the EC team. She's passionate about clean energy and hopes to live in a fully solar-powered home one day. When she's not writing about energy efficiency and renewable energy, you can find her at the thrift store digging for funky home decor and vintage clothing.

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