The rise of matchmaking services for homeowners and solar retailers

As the solar market grows and matures, we are seeing companies that emerge to provide narrower, more specialized services. The announcement by One Block Off the Grid today exemplifies that trend.

The San Francisco company said it’s now working with five major retail service companies, from installers to lease providers, to match them with homeowners who enlist One Block Off the Grid, or 1BOG, to help them figure out which installers and financing options they should choose. At the same time, the startup, founded in 2008, helps line up customers for the five companies, who pay 1BOG for each signed contract from a homeowner.

The five companies are SolarCity, Sunrun, SunEdison, OneRoof Energy and Clean Power Finance. 1BOG actually has worked with SolarCity for some time.

It’s difficult to start from scratch to shop for a set of equipment and services that you never had before. Back in 2011, I wrote about the need for a “Kelley Blue Book” for solar because informative sites designed specifically for consumers were lacking. Two months ago I wrote a post outlining seven issues to consider when homeowners shop for solar. Consumers can certainly read the specs of solar panels from different manufacturers, but then they would have to understand those technical terms. The solar market is young, so there are many installers who are new to the business and have yet to establish a long track record.

Some states that subsidize solar installations have created websites that offer some good advice and publish a list of certified installers. But being on that list doesn’t guarantee quality services.

I’ve been seeing more companies building a business around educating consumers about how to compare shop while also generating sales for solar companies. EnergySage in Massachusetts has gotten a federal grant to create a web portal to accomplish that.

For solar companies, the challenge is to market their services effectively and convert an online or phone inquiry from a homeowner into a contract. Customer acquisition can take up a good chunk of the cost — I’ve heard conversion rates that range from 2 percent to over 10 percent.  So it might make financial sense to hire a firm that specializes in finding and keeping customers.

1BOG has been matching homeowners with solar companies since its start, though the business model has shifted a bit over the years. In the beginning, it worked on uniting homeowners to negotiate better discounts for solar installation services. Over the years, it has built an expertise at using social media and other tools to attract and educate consumers who are interested in solar energy. It would then charge installers for a referral fee.

It has historically worked with smaller installers. Getting bigger players such as SolarCity and SunEdison should enable 1BOG to offer lower cost and wider variety of services, such as pairing battery energy storage with solar panels. And, of course, higher volumes of sales will means more revenues for 1BOG.