Starting a Solar Installation Business

What a solar installation company actually does

A solar installer designs, permits, installs, and connects photovoltaic (PV) systems, and increasingly battery storage, for homes, businesses, farms, and public buildings. The work combines electrical contracting, roofing, structural attachment, utility paperwork, and, for many companies, sales and financing. Revenue usually comes from:

1. Residential solar – rooftop and ground-mount systems for homeowners, sold for cash, through loans, or through third-party ownership (leases and power purchase agreements).
2. Battery storage – stand-alone batteries and batteries added to existing solar, for backup power and to manage time-of-use rates.
3. Commercial and agricultural solar – systems for businesses, farms, nonprofits, and public buildings.
4. Service and operations and maintenance (O&M) – troubleshooting, inverter replacement, monitoring, panel cleaning, and repairs, including systems whose original installer went out of business.
5. Subcontract installation – installing for larger sales companies, developers, or engineering, procurement, and construction (EPC) firms on a per-watt or per-job basis.
6. Removal and reinstallation – taking panels off and putting them back when a roof is replaced.

What changed in 2025

The federal tax law enacted on July 4, 2025 (Public Law 119-21, often called the One Big Beautiful Bill Act) changed the economics of solar in the United States. According to IRS guidance and the statute:

• The Residential Clean Energy Credit (Section 25D) ended. Homeowners can't claim the credit for expenditures made after December 31, 2025. The IRS treats an expenditure as made when installation is completed, so a system paid for in 2025 but completed in 2026 doesn't qualify. This was the 30 percent credit that homeowners who bought systems with cash or loans relied on.
• Business credits for solar (Sections 48E and 45Y) now have a hard deadline. For solar facilities that began construction after July 4, 2026, the credit is unavailable unless the facility is placed in service by December 31, 2027. Facilities that began construction on or before July 4, 2026 aren't subject to that December 31, 2027 cutoff but must meet IRS beginning-of-construction and continuity rules. IRS Notice 2025-42 tightened how "beginning of construction" is established for most solar projects, generally requiring physical work of a significant nature.
• Third-party-owned residential solar can still use the business credit within those deadlines. Leasing and PPA providers claim the business-side credit, not the homeowner. The law did deny the business credit for certain leased residential property (such as solar water heating and small wind) that would have qualified under 25D, so check how any specific product is treated.
• Energy storage has a longer runway. Energy storage technology under Section 48E isn't subject to the wind and solar termination; the general phase-down for storage begins for projects starting construction after 2033. Storage that is part of a solar project is also treated under the longer timeline, according to analyses of the law.
• Foreign entity restrictions apply. For projects beginning construction after December 31, 2025, the business credits are restricted when a project includes "material assistance" from prohibited foreign entities, which affects equipment sourcing.

Because tax law is complex and guidance continues to evolve, never promise a customer a tax outcome. Your role is to give accurate information about the system and refer tax questions to the customer's tax professional, and, for business-side credits, to work with financiers and tax advisors who structure the deals.

Warning: Some solar salespeople have continued to tell homeowners they will "get 30 percent back" on systems installed in 2026. That claim is false for homeowner-owned systems under current federal law, and making it can expose your company to consumer protection complaints and legal liability.

Tip: Keep a one-page "what changed" summary, with links to the IRS pages, to hand to customers and partners. When a customer hears conflicting claims from another salesperson, an official source settles the question and positions your company as the one telling the truth.