Solar Tricks and Traps (Part 1)

Last updated 6 days ago by James Rendle

11 minute read

Solar Power is a Wonderful Resource


It's one of the cheapest ways to generate power, it's clean and good for the environment, and with all the rebates and incentives it may sound like a "no-brainer". But when it comes to solar installers, you shouldn't turn off your brain. In this article we're going to cover every trick, trap, sales tactic or misdirect in the book. We'll be using real life examples taken from solar quotes in Nova Scotia within the past year, with all identifying information removed. If you spot some of these things in the wild, remember that everyone has off days sometimes and it's difficult to tell what's intentional and what's the new guy phoning it in.  The goal of this article is to provide enough background knowledge to the consumer to keep their installer honest. 

 "What you don't know, can hurt you." 

Working Backwards from the $40,000 Interest Free Loan

Launched in 2022, the Canada Greener Homes Loan (CGHL) offers a 0% interest loan up to a maximum loan amount of $40,000 with 10 year term. This is an excellent way to finance energy efficiency upgrades. Because Solar Equipment is specialized and fairly niche, the average person does not know the retail value of various brands of panels or inverters. The most common question people have is "how much does a solar system cost?" The answer should depend on your power bill, the amount of panels you need to offset your bill, and specific circumstances regarding your property.

Some solar installers look at the $40k CGHL and decide that all solar PV systems cost $40k. Here are some tactics they use to get the price up in a "justifiable" manner.

Case Study 1:
North Facing Panels
Bad Solar Design
Gaming the $40k interest free loan
200+% Solar Equipment markup from the
Retail Value
  • North facing panels are a bad idea in general, North East and North West facing roofs at a shallow pitch can be okay, but any panels on the North side are going to produce around 30% less than the south facing ones. This alone could be justified, but not when we look at the choice of equipment.

This is a single string inverter (10kW de-rated to 9.6 kW). There are no DC optimizers in this design. A string inverter system without optimizers is capped at the performance of the lowest performing panel. 
*Note that some string inverters have software that can mitigate this such as Fronius's "Shadefix" software, and some allow for MPPT tracking, but that's not the case here.* 

  • Adding North facing panels without at least putting a DC optimizers under the North facing ones is bad system design, and it means the entire system performs at whatever the North facing panels are producing in that moment. The entire system would perform better without those panels. 
As to why those panels are there...

Gaming the $40k interest free loan - It appears this installer has worked backwards from that number and is attempting to justify the system cost (even though there's already a 200%+ markup on their solar equipment). In Case Study 2 we'll see a similar example but without the justification of some North facing panels.

200+% Solar Equipment Markup

Solar installers are product retailers. We buy in bulk and get a wholesale price for the equipment. The retail price for the equipment is whatever the average person can buy it for. Smaller solar installers are buying at closer to retail prices than larger ones, so some equipment markup is expected. Below are some examples given at the time of writing of the retail value of the equipment in the proposal, these are screenshots from public websites, anyone can buy this stuff at that price. 
31 x LR7-54HGBB-450M = $8,270
1 x Solis-1P-10K-4G-US = $3,004
Solar Equipment Retail Value = $11,274
Keep in mind an installer should be able to get this equipment for less than that (wholesale price).

We're missing some components - sometimes called "balance of system"; racking, cabling, and installation.
If we use our numbers (2025) -
(Note to visitors from out of province, local factors such as building permits, site plans, or even local electrical code interpretation can change these numbers)

Installation - $5,000
Racking - $170 per panel
Cabling - $65 per panel
Balance of System = $12,285

Total - $23,559

Quote ($36,816) minus Balance of System ($12,285) divided by Solar Equipment Retail Value ($11,274) x 100 = 217%
This means that the Solar Equipment is marked up over 200% from the retail value. 




Gaming the $40k Loan

Case Study 2

This is another example of working backwards from $40k. This is a 22 panel system, it's not a ground mount, it's not got batteries, it's just a standard roof mounted system.
Working backwards from $40k

Abusing Production Estimates


Case Study 3
If an installer wants to maximize their profits by overcharging for the equipment, they need to still make the return on investment calculations look good.
The numbers on a solar proposal can be quite confusing, here's a good guide to what they are and why they're there.
 - https://wattsupsolar.ca/insights/how-to-read-a-solar-proposal

Here we're going to talk about how some installers will manipulate the raw data. As a consumer, the quickest way to check this is to find these numbers;

1) Escalation rate on power
2) Estimate annual efficiency of the system
3) Current rate of power

Estimated Annual Efficiency

This one isn't commonly seen on solar proposals, but it's useful to measure if a company is being accurate with their estimates. The measurement is kWhs per kW DC per year. You can work out this number even if it isn't explicitly stated by dividing the First Year Production by the System Size in DC.
  • A particularly inefficient system (due east at 45 degrees) would be around ~900 kWhs per kW DC.
  • An extremely efficient system (due south at 45 degrees) would be around ~1,250 kWhs per kW DC.
  • The average in Halifax is ~1,100 kWhs per kW DC.

Below we have a good example of Abusing production estimates
The estimated annual efficiency often isn't specified, because if it was it'd be obvious that there's a mistake.
10,638 kWhs divided by 7.65 kW DC gives 1,390 kWhs per kW DC. This number is absurdly high.
We keep a database of all of our systems.
https://wattsupsolar.ca/systems?backup=0&sort=last+year+production+efficiency
Sorted by last year's annual efficiency, not a single system was that efficient. We have seen efficiency slightly above 1,300 kWhs but it's rare, inconsistent, and not the basis to make a large investment. Getting well above 1,300 kWhs per kW DC is approaching physically impossible.

*Note: Proposal software tends to default to higher efficiency numbers, as the default loss factors are often set slightly low. In this case however, it's clear someone manipulated the loss factors to produce this result.*
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Current rate of power
The current rate of power is important for solar proposals, it's often not specified, but you can work backwards by taking the first year value in dollars and dividing it by the first year annual production. In this example, the current utility rate for this utility is $0.18 per kWh.
The higher this number is to start with, the better your proposal will look.

$2,021.08 divided by 10,638 gives $0.19 cents per kWh. So this proposal is using an incorrect utility rate, presumably to get the "Projected Payback Period" to under 10 years.

Escalation rate of power
Because the price you pay for power is the same the utility pays you for your power. (See Self Generation Offset program details)
https://wattsupsolar.ca/self-generating-option

The faster the price of a kWh increases the quicker the return on investment.

This number can be quite subjective. Historically, over the past 10 years, the escalation rate has been around 3.6%, but it's not consistent, some years it can be as high as 7%, other years might not see a rate increase at all. It depends on negotiations between the provincial Government and the utilities and the utility and review board (UARB). In general, putting a higher escalation rate on a proposal is not a bad thing in itself, but it can be used to lever the "payback period" number down, and hide extreme equipment markup. After all, if you put 10% as an escalation rate, you can make any price look good. 

Excessive DC Over-sizing of Solar Equipment

Case Study 4
North Facing Panels
Excessive Abuse of DC:AC Ratio
400+% Solar Equipment markup on the
Retail Value
North Facing Panels -
Like Case Study 1 the panels are on the north side of the roof, note in this case the roof pitch is steep at 45 degrees. Panels placed on the north side of the roof would be 42% efficient compared to the southern side.
Tip: the "heat map" on this particular solar proposal software shows where you shouldn't put panels, in red, and where you should, in yellow. 

Excessive abuse of DC:AC ratio.
The DC size of the system is 33.62 kW, the AC size is 18 kW from 2 x 9 kW Growatt inverters. The DC:AC ratio is 1.87
Again this is a string inverter system without DC optimizers.

DC System Size - Wattage of solar panels added up
AC System Size - Wattage of inverter(s) added up

We talk about DC:AC ratio in our other support guide here:
 -https://wattsupsolar.ca/insights/a8d7d467-59df-4da0-9d21-7b41af4f1dc6

It's generally accepted that the DC:AC ratio should be between 1.2 and 1.4 in Nova Scotia. The main reason for this is that panels degrade over time, typically by 15% over 25 years. If you want the system to produce the same amount each year for 25 years you need to take that into consideration initially.

To word this in another way. The system can potentially capture 33.6 kW of solar power, but the most the inverters can handle at any one moment is 18 kW. Granted, most of the panels on the North roof aren't doing much, but this strategy is clearly motivated by installer profit. 

400+% Markup of Solar Equipment

Case Study 4
83 x LR5-54HPB-405 - (same model but 5W difference) = $8,715
2 x Growatt - MIN 9000TL-XH-US = $5,204
Solar Equipment Retail Value =  $13,919
Keep in mind an installer should be able to get this equipment for less than that (wholesale price).

We're missing some components - sometimes called "balance of system"; racking, cabling, and installation.
If we use our numbers (2025) -
(Note to visitors from out of province, local factors such as building permits, site plans, or even local electrical code interpretation can change these numbers)

Installation - $5,000 (Granted, this is a fairly large system and you could charge more here than we would)
Racking - $170 per panel
Cabling - $65 per panel
Balance of System = $24,505

Total - $38,424


Quote ($80,340) minus Balance of System ($24,505) divided by Solar Equipment Retail Value ($13,919) x 100 = 401%
This means that the Solar Equipment is marked up over 400% from the retail value. 

Wattsup Solar Example


It's unfair to do these sort of cost analysis without also giving ourselves the same treatment. This example isn't just made up for the purposes of this article, here's our Online Advertised Pricing - https://wattsupsolar.ca/pricing
17 x Enphase IQ8A = $5,204
Solar Equipment Retail Value =  $7,305
Keep in mind an installer should be able to get this equipment for less than that (wholesale price).

We're missing some components - sometimes called "balance of system"; racking, cabling, and installation.
If we use our numbers (2025) -
(Note to visitors from out of province, local factors such as building permits, site plans, or even local electrical code interpretation can change these numbers)

Installation - $5,000
Racking - $170 per panel
Cabling - $65 per panel
Balance of System = $8,995

Total - $38,424


Quote ($17,325) minus Balance of System ($8,995) divided by Solar Equipment Retail Value ($7,305) x 100 = 14%
This means that the Solar Equipment is marked up 14% from the retail value. 

(If you're wondering why there's even this much markup, bear in mind we offer consumption monitoring and SolaTrim for free with our installations in 2025).

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