The terms of cooperation between the homeowner and the company installing the solar panels, including cost, date, equipment used, and price, are outlined in a written agreement. A solar services agreement helps the customer understand the terms and conditions of the PPS installation. There are several types of agreements depending on the duration, payment terms, equipment specifications, installation company services, and contingency guarantee. Once signed, the agreement between the owner and the installer gains legal force, so the document may be difficult to terminate without judicial intervention.
Buying solar panels is a serious investment. Before entering into an agreement with a company that provides installation, maintenance, and repair of modules, the customer should study the proposal in detail. A positive outcome in the operation of the equipment depends on understanding the specifics of the solar contract. The importance of a correct understanding of what is set out in the document minimizes legal disputes and helps to avoid termination of the agreement.
A solar contract is drafted whether a homeowner buys a panel system for cash, sells excess kilowatts to the state, enters into a battery lease, or agrees to a PPA.
The document is packed with details and lots of unfamiliar technical terms. Knowing how to read the contract is the first step to success in operating a PPS.
Basic Clauses of Solar Panel Contracts: Features and Descriptions
The solar energy utilization document should include the key elements, such as:
- Cost, billing, and payment terms. The section contains information on the terms of payment, interest rates (fixed or variable) in the case of a loan, late payment fees, the frequency of repayment of the amount, and the financial institution that provides the loan.
- Technical characteristics of the equipment and the number of parts. The capacity and the brand of solar panels and inverters are indicated. If an accumulator is used, information about the brand and the volume of energy stored is indicated.
- Design, obtaining permits for installation, and modifications to the design during the installation process.
- Information about the warranty, and performance of the solar panels. This is the information about the commitments made by the battery installer, including monitoring of component function and quality of work. The contract specifies the performance guarantee and the lifetime of the photomodules.
- Contract termination and dispute resolution. The section provides methods for settling disputes related to the purchase, installation, and maintenance of the panels, and how to resolve complaints privately without involving the court system. The agreement describes the period of negotiation, the procedure for termination, and the fees charged for such termination.
- Schedule. The agreement specifies a start and end date for installation work, estimating the time required for each step: obtaining permits, purchasing equipment, physical installation, and setting up operations.
- Ownership. This section of the solar contract template provides the terms and conditions for selling the solar panel for financing, leasing, or PPA. For these actions to take place, the PPS owner must repay the loan or obtain the buyer’s consent to purchase the equipment, requiring payment to the financial institution. Contracts for solar module leases or PPAs include provisions on how ownership is transferred.
The points outlined cover the issues that are addressed in the standard agreement. The structure of the document may vary depending on the design, location, method of payment, and installation of the system for a particular customer. The list is not exhaustive of all key provisions.
Additional Sections That Can Be Included in the Contract
Before drawing up an agreement between the PPS module owner and the supplier company, it is worth considering the following points, which may not be part of the contract but are capable of maximizing the owner’s benefit from investing in solar panels. Attention should be paid to:
- Analysis of the operating principle of a PPS. The information will help to understand whether it is appropriate to install the equipment.
- Matching the productivity of the system to the needs of the household. For this purpose, the total power produced by the batteries is measured. The modules should maximize the annual electricity consumption to eliminate the cost of energy bills.
- Return on investment. This involves analyzing the total cost of the photo modules and the cost of the annual energy consumption bill.
- Battery efficiency. Over time, even productive panels lose power. On average, equipment suppliers guarantee 25 to 30 years of operation.
- Government incentives. The installation company informs the PPS owner of incentives offered by the government at the federal or national level. The owner will find out if he or she is eligible to claim the incentives.
After reviewing and analyzing additional issues, the homeowner may sign the agreement.
How the PandaDoc Platform Assists in Drafting a Contract for the Installation of a PPS
To save time and take into account all the details of the agreement, it is recommended to use a ready-made sample contract. The document templates available on the PandaDoc platform have been developed taking into account the legal nuances. A ready-made agreement eliminates administrative delays and reflects the needs of the project.
There are different types of solar panel installation contracts available on the company’s website. A lease contract provides that the power plant remains the property of the installer and the energy is leased by the customer. Solar energy development agreements are used to describe the technologies used, offer supplier services, and optimize the return on investment for developers – individuals or legal entities. The PPA template includes information about the expected number of kWh per month, cost of electricity, installer and owner responsibilities, etc. A service contract is signed between the owner and the company specifying the timing, and cost of work.