Solar Contractor Licensing Edition

More and more Americans are demanding solutions to energy efficiency and conservation.  Cost cutting and money saving ventures are a common and necessary practice amongst consumers and the electric generation industry is no stranger to this goal. With solar energy and solar paneling becoming more accessible and affordable, consumers have the opportunity to “go green” and reduce their energy expenditures over time, for both their businesses and homes. 

New Jobs are Radiating the Country

According to the Solar Energy Industries Association, solar represented 39% of all new electric capacity added to the United States grid in 2016, making it first over natural gas and wind. While there has been much discussion early this year regarding the uncertainty for continued growth of the solar power market, the demand for solar power created 51,000 new solar jobs in the United States last year alone. These new jobs, however, have prerequisites and regulatory requirements to market entry.  Solar contractors must often have contractor licensing credentials, which can subject new hires to training, examination, and work history disclosures prior to licensure.  

New Power is Energizing the Regulators 

These new solar jobs helped complete the 1.3 million solar installations in the U.S. in 2016. The creation and expansion of this market has led to the creation of new licenses, regulations, and requirements for solar contractors, which vary greatly depending on the state in which you are doing business.

Solar contractor services have proven to be a complex area for states to regulate and states often vary on how they classify the work being done. For example, Alaska categorizes solar installation under their construction contractor license, while Alabama considers solar installation to be electrical contracting work. Aside from the different classifications, states also have varying prerequisites, such as obtaining a business license or sitting for a trade exam. The stringent new regulations and web of requirements can make it difficult for a business to even find qualified candidates to fill their solar contractor positions. 

It is important to note that the licensing requirements could begin sooner than the job commences.  Certain states require solar contractors to have a license in place simply to place a bid on a solar project. For example, contractors must be licensed with the Oregon Construction Contractors Board in order to advertise, submit bids or enter into residential contracts for solar construction in the state of Oregon.

Failure to be properly licensed will usually result in penalties and fines, but other legal implications can come into play. Contractors who are not properly licensed can lose their legal right to file a construction lien against a property if the owner has failed to pay on a job. Further complicating the solar contractor regulatory landscape, subcontractors, even if properly licensed to perform solar contracting work, should verify their business partners’ licenses. A subcontractor who knowingly enters into an agreement to perform work on behalf of an unlicensed contractor can be subject to fines as well.  


Before You Connect to the Grid, Let LicenseLogix Help!

Without question, the US solar energy market experienced expansive growth over the past ten years and local contractors have taken advantage of the new business opportunity. Compliance with the many industry regulations may seem daunting, but LicenseLogix is here to help. 

Please check our resources on streamlined business license compliance for this industry.  Don’t let the sun set on your window of opportunity!  You may also contact our license specialists at 800.292.0909 today to let us handle your solar contractor business licensing needs.