The residential solar industry is under threat by a myriad of challenges including tariffs, high interest rates and potential changes that could result if the One Big Beautiful Bill passes unchanged.
As a result, the sector has suffered some noteworthy bankruptcies including Mosaic, a solar loan company, and residential solar installers Sunnova, SunPower and Titan Solar. (SunPower, however, is staging a comeback under the watchful eye of T.J. Rogers.)
Challenges to the residential solar sector include the tariff effect on supply chain, potential elimination of tax credits in the House-passed reconciliation bill and continued high interest rates. The changes that would particularly affect residential solar in the bill is the elimination of the Investment Tax Credit (25D), which had been in effect through 2034. If passed, 25D would end on December 31, 2025. Also at risk is the elimination of 48E for third-party owned systems.
In light of the challenges, two questions come to mind: How can residential solar installers prosper and how can customers be confident that solar is a good long-term investment?
pv magazine USA spoke with Dean Chiaravallotti, chief revenue officer with Solar Insure, a company that provides solar and storage warranties for both the solar installer as well as residential solar customer.
Chiaravallotti noted that solar is the fastest growing source of deployed energy in history. “Solar energy is so good that we don’t need subsidies, it can stand on its own,” he said, adding that, it requires that all the players in the industry be “adaptable, innovative and strategic in times like these.”
In order to be adaptable in the face of adversity, it’s necessary for solar business owners to be efficient.
“Tax cuts and tariffs are just symptoms of the solar industry. It’s really about adapting; there are times that we really just have to do that. If we don’t adapt to risk, we will see 30%+ of the solar companies go out of business,” he said.
To adapt, businesses should become 30% more efficient, he said. Examples Chiaravallotti gave include becoming ‘lean operators’ starting with examples like working on systems installed by other companies, finding better solar loans, managing sales commission costs and consolidating tools.
With solar installation companies going out of business, customers are often left hanging, with nowhere to turn for service and support. Chiaravallotti advises turning service departments into profit center by taking on these customers.
While paying in cash is the fastest way for solar customers to see a return on their investment, not everyone has the cash up front. Chiaravallotti advises solar businesses to educate customers on the many lending choices available so they can make well-informed decisions. He also noted that many solar loans have 30% to 40% dealer fees, which is equivalent to what the customer would currently get back with their tax credit. Whether that tax credit is eliminated or not, Chiaravallotti said it is possible to find loans with low or no dealer fee from local banks or “forward-thinking solar lenders”.
Another way to cut costs, he said, is to bring sales efforts inside and take a look at the tools used to generate, close and track sales. By bringing sales inside, businesses may be able to avoid sales commissions from outside firms that can be as much as 50% of the sale. Furthermore, streamlining tools can cut overlap. Chiaravallotti noted that, on average, companies are using seven to ten apps—“one for door knocking, one for proposals, one or two for project management, one for lead generation.” By making it a regular practice to audit the number of licenses purchased versus the actual number of people using them, solar businesses can likely consolidate and save.
Moving forward, regardless of the outcome of the investment tax credit and other challenges to the industry, Chiaravallotti said solar businesses are wise to follow best practices of successful solar providers. By branching out and providing existing customers with new options, such as batteries, roofing and service, a solar business can become the trusted providers of “all things solar.”
“Now is the time to rise to the moment, to cut through the noise, streamline your business, and focus on what matters,” he said. “Those who stay adaptable and resilient through this cycle won’t just survive — they’ll emerge as the leaders shaping the next five years of the solar industry.”
The recently released U.S. Solar Market Insight Q2 2025 report by the Solar Energy Industries Association (SEIA) and Wood Mackenzie remained optimistic about the residential sector, despite its slowed growth. The report saw “significant long-term potential,” because only about 10% of the market has been penetrated and expects, in its base case scenario, for the segment to grow by 9% on average annually between 2025 and 2030.
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