Business Model · Construction

The Solar Installation Business

A residential install trade with a heavy sales engine, sold one system at a time. Here is how a solar installer actually pencils: the lead-gen and close funnel, commodity hardware costs, and why incentives and financing drive demand more than craftsmanship.

15 min experienceInteractive economicsBuilt from BLS & Census data
Read the launch plan: every step from deciding to opening, free →
01

The Snapshot

Is this worth your attention?

$1M to $5M
Typical annual revenue
2-4 crews · residential PV at scale
10% to 22%
Owner cash margin (SDE)
share of sales the owner keeps before their own pay
~$23/hr
Median installer wage
$48,800/yr (2024)
$95k to $354k
Cost to open
two crews, trucks leased; typical about $99k
Medium
Day-to-day difficulty
sales, permitting, crews, interconnect
Low-Med
Absentee potential
systemized with a GM & sales lead

Cited sources Typical bands for this kind of business, compiled from the public sources listed under Sources and method; they are a synthesis, not figures copied from any one source. Estimates, not forecasts; a specific business varies with its location, lease, equipment and owner. Last reviewed 2026-07-07. smbnest is a self-assessment tool, not individualized advice.

A fit if you...

  • Can build and run a lead-gen and sales funnel, not just install
  • Hold or can hire electrical and roofing licensing
  • Are comfortable in a fast-moving, policy-driven market
  • Can manage permitting, interconnection, and inspections

Probably not if you...

  • Want a passive, absentee investment from day one
  • Dislike running a high-spend customer-acquisition machine
  • Cannot recruit or retain licensed electricians and roofers
  • Have no appetite for policy and incentive risk
02

Step Inside the Layout

A live look at one tool inside

This is the actual 3D floor from the full model. Drag to explore it. Inside, you configure the space yourself and watch the economics move with every choice.

Loading the live model…
Sources and method15 public sources, with the year and a link where the source gives one. The benchmark bands are smbnest's synthesis of these sources, not figures copied from them.

Sources & Method

Figures are compiled from the public sources below; the bands are a synthesis of them, not copies

How these numbers were built: installer wages come from the BLS OEWS (SOC 47-2231 Solar Photovoltaic Installers, median ~$48,800/yr); industry structure comes from the U.S. Census Bureau (electrical contractors, NAICS 238210, and roofing contractors, NAICS 238160); install growth, system pricing, and the policy and incentive drivers are anchored to Solar Energy Industries Association (SEIA) market data as a secondary industry source; the end of the homeowner tax credit comes from the Congressional Research Service and the 2026 market outlook from Wood Mackenzie; financing terms come from the SBA; survival signals come from Census/BLS business-dynamics data; sale prices and multiples come from BizBuySell’s construction valuation benchmarks; and the cost to start is the item-by-item opening kit, priced from dealer listings, licensing boards and insurer data. Installs-per-crew-per-week, system price, and the labor stack in the simulator are industry-typical placeholders calibrated to these sources. Hardware is held at 48% of the system price, from NREL’s Q1 2024 residential benchmark (about $1.51 a watt of $3.15 with shipping and sales tax), and the cost to win a customer at $3,400 per system sold, the top of the $0.25 to $0.45 a watt range for local, referral-led installers, since 2026 acquisition costs rose about 40% nationally. Figures are current as of 2024-2026.

The hardware share follows NREL’s Q1 2024 residential cost benchmark (about $1.51 a watt of a $3.15 a watt system, with shipping and sales tax); the cost to win a customer follows installer-segment data for local operators ($0.25 to $0.45 a watt) against Wood Mackenzie’s 2026 national average ($0.84 a watt); the margin range and labor band are anchored to SEIA market data, and wages to BLS OEWS. These are secondary industry figures, so treat them as directional benchmarks.

Government data
U.S. Bureau of Labor Statistics · 2024
OEWS: Solar Photovoltaic Installers (SOC 47-2231), median ~$48,800/yr
https://www.bls.gov/oes/current/oes472231.htm
U.S. Census Bureau · 2022
County Business Patterns: Electrical (NAICS 238210) & Roofing (NAICS 238160) Contractors
https://www.census.gov/programs-surveys/cbp.html
U.S. Small Business Administration · 2026
7(a) loan program & size standards (specialty trade contractors)
https://www.sba.gov/funding-programs/loans/7a-loans
U.S. Census Bureau (BDS) & BLS Business Employment Dynamics · 2024
New-business 5-year survival rates
https://www.census.gov/programs-surveys/bds.html
Congressional Research Service · 2025
Expiration and carryforward rules for the Residential Clean Energy Credit (IN12611): the 30% homeowner credit does not apply to expenditures made after December 31, 2025
https://www.everycrsreport.com/reports/IN12611.html
National Renewable Energy Laboratory · 2021
U.S. Solar Photovoltaic System and Energy Storage Cost Benchmark: Q1 2020 (customer acquisition $0.38 a watt for small installers vs $0.50 for national integrators)
https://docs.nrel.gov/docs/fy21osti/78882.pdf
Industry
Solar Energy Industries Association (SEIA), industry anchor · 2024
U.S. Solar Market Insight: install growth, system pricing, and policy drivers
https://www.seia.org/solar-industry-research-data
Wood Mackenzie · 2026
US residential solar customer acquisition costs set to spike 40% in 2026 (to $0.84/W) as the market contracts about 19%
https://www.woodmac.com/zh/news/opinion/us-residential-solar-customer-acquisition-costs-set-to-spike-40-in-2026-before-gradual-decline/
SurgePV, citing NREL’s Q1 2024 cost benchmark and SEIA/Wood Mackenzie · 2026
Solar installation cost breakdown: residential benchmark $3.15 a watt (NREL Q1 2024); modules $0.40, inverters $0.37, racking $0.32 and electrical BOS $0.30 a watt, plus shipping and sales tax about $0.12
https://www.surgepv.com/blog/solar-installation-cost-breakdown
SurgePV, citing Greentech Renewables installer-segment analysis and Wood Mackenzie · 2026
Solar customer acquisition cost 2026: local operators $0.25 to $0.45 a watt, referral-focused local $0.15 to $0.30, mid-size regional $0.40 to $0.70, national $0.60 to $1.00 or more; 2026 average $0.84 a watt
https://www.surgepv.com/blog/solar-customer-acquisition-cost
GreenLancer · 2025
A guide to solar licensing requirements by state for contractors
https://www.greenlancer.com/post/a-guide-to-solar-licensing-requirements-by-state-for-contractors
SurgePV · 2026
NABCEP certification guide: PVIP application $125, exam $375, 58 hours of training, OSHA 10, recertification every 3 years
https://www.surgepv.com/blog/nabcep-certification-guide-2026
Market & valuation
BizBuySell · 2025
Construction business valuation benchmarks: median sale about $750k on about $1.5M revenue; median 2.43× SDE, middle half 1.81× to 3.13×; electrical and mechanical contracting about 2.66×; median 207 days on market (sold 2021 to 2025)
https://www.bizbuysell.com/learning-center/valuation-benchmarks/building-construction/
SurgePV · 2026
Solar installer insurance requirements and costs: general liability, workers’ comp, commercial auto, inland marine and bonds by company size and state
https://www.surgepv.com/blog/solar-installer-insurance-requirements
Regulatory
California Contractors State License Board
License application and initial license fees
https://www.cslb.ca.gov/about_us/library/fees.aspx

This is just the surface

The full model is the complete, interactive deep-dive, and every business here is built to the same standard: a live economics simulator you tune to your own numbers, an interactive 3D walkthrough, a location scorecard, an owner-fit assessment, a buy-versus-build comparison, and the full breakdown of how it makes money and what quietly kills margin.

Monthly
$99 for your first 3 months

then $29 a month

Time to choose and start, then month to month.

$99 today for your first 3 months, then $29 a month until you cancel.

YearlyBest price
$199 a year

about $17 a month

The best price: a year to decide, open and run it.

$199 today, then $199 each year until you cancel.

Renews until you cancel. Cancel any time from your account; you keep access to the end of the period you paid for, and your saved plans stay in your account. What membership opens

smbnest is a self-assessment tool. It does not give individualized financial, investment, legal or tax advice. Figures are estimates and benchmarks, not forecasts. Speak with a qualified financial adviser and a licensed attorney before you start, buy, finance or sign anything.