Thursday 28 May 2015

Solar Attrition Rates

An Analysis of the MCS Installer List

I recently had the opportunity to have a look in more detail at the list of installers registered with MCS, and what I found came as quite a surprise to me.

The number of solar PV installers registered with the Microgeneration Certification Scheme (MCS) has been on a declining path since the boom of 2010-11.  This is not news to anyone in the industry.

Right now, the number of solar PV installers registered with MCS (removing duplicates) is around 2,640, a fall of 24% since 2013.  But when you look at the actual companies that make up this headline figure you find that less than 50% of the solar PV installation companies on the list in 2013 remain two years later. 1,822 companies have left the market, but 980 new companies have joined the list in the last two years.

Churn Rates in Solar Installation Businesses

Turning to the list of solar thermal companies, we see that the decline in numbers has not been as severe as for the PV installer companies, a 13% drop from 1,298 companies in 2013 to 1,130 now.  However, the churn rate is just as eye-watering.  Nearly half of the solar thermal installers registered with MCS in 2013 are no longer on the list, but the 635 that have left have been replaced by 467 new companies.

What's going on?  Are these attrition rates normal for similar industries (home improvements, heating, electrical works)?  Or is there something 'special' about our solar industry?