Generac Power Systems, a Fortune 1000 company that sells residential backup power generators, is making a play for your own residential solar and storage market.
This spring the Wisconsin-based company, a part of stock-listed Generac Holdings Inc., acquired storage manufacturer Pika Energy and house energy management system firm Neurio Technology. Relying on these technologies and drawing the 60-year-old company’s experience in fostering markets, Generac will sell home solar and storage systems, to be installed by an army of builders. “We consider the storage and solar marketplace and we see accelerated growth, and we don’t see really entrenched leaders in the area “
Generac plans to draw in new customers in part utilizing a multimillion-dollar infomercial campaign. Those leads are then going to be shuttled to builders that will sign customers and execute installations.
After selling more than two million residential backup systems and building a roster of 6,200 contractors, Minick said Generac is well positioned to jump aboard the solar coaster.
“We have our distribution chain, our sourcing, our engineering — all which fits perfect in the solar area,” explained Minick. “There are so many synergies here…why not?”
While Generac will likely be selling systems from Neurio and Pika, Minick said the company is”panel-agnostic” as it comes to solar and open to whatever merchandise its contractor wants to use.
Generac offers loans GreenSky and Loanpal on its stage, and will add Dividend to its roster. Other financing choices, such as leases or third party possession, may be provided from the builder as well.
The infomercial route
Generac’s unique infomercial model may permit the company to achieve a wider swath of customers at a space where attracting new customers is notoriously expensive. Though dropping millions into TV ads is not cheap either, Generac hopes to have a return on its investment via prospects it can subsequently pass to contractors who would in turn set up its own systems.
Because of this, Minick doesn’t see Generac as a threat to established solar-and-storage companies like Sunrun or Vivint (a Vivint spokesperson told GTM in the show that she’d observed a Generac infomercial just the other day).
“We wouldn’t compete; they’d be customers of ours,” explained Minick. “They’re interested in our guide generation; we are interested in being [their partner].”
Based on Minick, the infomercial model is proven: Over the last 12 months Generac created more than 100,000 annual appointments for product followups, ” he said.
And when compared with typical customer-acquisition prices that clock in at about $4,550 per client to get a 7-kilowatt solar system, according to Wood Mackenzie Power & Renewables, Minick stated Generac can likely bring in appointment leads for under $150 a soda (Generac’s system sizes begin at around 8 kilowatts).
“nobody has resisted the power of TV on the distance,” he said.
Opening the floodgates on that quantity could include drawbacks, though. Generac said it is already”essentially” sold out for 2020 and is working to keep up with demand and be sure product is accessible.
“We are utilized to volume and supply chain,” said Minick.
Generators still greatest for extended outages
Entering into the clean energy economy allows Generac to”future-proof” its company, as more customers look to renewable alternatives amid growing concern about climate change. But Minick said its new goods are likely to appeal to different clients than those interested in its generators.
While its core market for generators is present in hurricane-prone regions like Florida and the Northeast, Minick stated Generac intends to market solar and storage in to countries like California, Arizona and Hawaii. Even though there’s a”small overlap” for clients — believe Puerto Rico, in which customers are looking for renewable resiliency alternatives and gas deliveries can be stalled due to weather — the company still viewpoints generators as the ideal alternative for long power outages.
“For a long-term power outage, which the majority of people buy [generators] for, this can be a far more [effective] machine,” explained Minick, pointing to Generac’s generator display at Solar Power International. “Natural gas is dirt-cheap.”
That view will likely create Generac something of an outlier from the energy business, where entrepreneurs peddle solar as a free and consistent source. However, Minick does admit the daily money-saving opportunity provided by batteries and solar.
“It really is a power outage machine which sits there,” stated Minick, nodding to the generator.
As for storage, Minick said, that is”power insurance.”
“These products operate on a daily basis and save money,” he said, speaking of solar and storage. “They are a planet-saver plus a money-saver.”
