Branding Solar Energy

by Richard T. Stuebi

One of the biggest challenges facing cleantech, relative to other forms of technological innovation, is that the basic markets being served are widely viewed as commodities.

In high-tech, many people are willing to pay very high (and profitable) prices for new gadgets with cool functionality.  Witness just about everything that Apple makes, along with anything in the videogame sector.

In health care and life sciences, cost is often not much of an object.  When you face the prospect of (for instance) prostate cancer treatments, you might be willing to pay a LOT more for a non-invasive approach.  I know I would.

However, rarely does anyone want to pay one iota more than necessary for something like energy.  And, that creates a huge problem for those who are trying to sell into these markets but have high cost structures. 

In the photovoltaics industry, German companies that dominated the sector have now given way to Chinese module manufacturers that can kill them on price and cost.  As this recent article from the New York Times discusses, the German players are attempting to maintain share and profitability by positioning themselves as premium products, worth paying more to obtain.

I wish them well, but I think it’s going to be a tough sell.  In my view, the only way possible to fetch a price premium is to make the case that the full life-cycle ownership cost is lower (i.e., less maintenance, more power production) when the higher-priced product is bought.

Otherwise, branding in the solar energy field will be extremely challenging.  You might look cool driving a Porsche, and might get an ego stroke from wearing a Hermes tie, but I’m having a very hard time imagining you’ll get any psychic benefit from buying a higher-priced solar panel — no matter what a well-paid pitchman may say.

6 replies
  1. Whit Fletcher
    Whit Fletcher says:

    Having been in the position of selling pv to residential customers, I couldn't agree more. Particularly when the wish of the customer is their solar modules not be seen by their neighbors! Let's face it, the untrained eye can't tell the difference between a bargain Chinese panel and a higher priced Euro design…… how do we make the case for quality? Pick your battles. Most people won't pay a premium price for anything, a few will only buy the best. The danger for the whole industry is lower priced modules/inverters turning out to be low quality products and failing on a grand scale, giving all of it a black eye. But, that's the free market system.

  2. Solar Energy Systems
    Solar Energy Systems says:

    In order for solar to really make an impact, it has to become a commodity and the only way to do that is to make it cheap.. I applaud the Chinese for driving solar panel prices down. Many companies have put the Chinese manufactured panels to the test and they have performed well. Its not like making a plastic widget where there are hundreds of players in the market. Making solar cells takes a pretty rigorous manufacturing process and a large capital investment. It would be foolish for a manufacturer to go to all this expense and turn out a product that would fail quickly. That would kill their reputation and kill the company. Just because it is Chinese manufactured doesn't mean that it is poor quality. Almost ever industry manufactures in China these days and not all of these are "Walmart" quality. Our labor costs are too expensive in the US and our core strengths have shifted away from manufacturing. Let the Chinese drive the price of solar panels down where it can compete with Coal. We will all benefit from that.

  3. Arizona Solar Panels
    Arizona Solar Panels says:

    The price does need to drop dramatically. The problem we are seeing is at the prices drop, the rebates and incentives are disappearing … we need to keep up with not only the Chinese, but other countries, such as Germany who are getting onboard the solar wagon.

  4. Fix Air Conditioning
    Fix Air Conditioning says:

    They've been working on this technology for decades now so just like computers and TV's you would think somebody would innovate and manufacture more affordable solar panels. I haven't seen the hybrid air conditioners yet but I do now you can get an AC solar generating system which supplies 240 volt power to just the air conditioning unit and produces up to 626.40 kilowatt hours per month provided your area receives around 5 hours of peak sunshine per day. But again, they're like $18k. 🙂

  5. Air Conditioning Pgh
    Air Conditioning Pgh says:

    No doubt Solar is going to dominate the future. Solar has however gotten a bad rap with fires originating from faulty products and installations around our town. I don't see this improving much until the bigger players jump on board. Nice comment Solar Energy Systems.

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