Accounting for 30% of all PV energy produced in the United States, California is the number one market for solar energy in our entire country. Even so, competition to earn the business of customers is fierce. With over 2,400 solar companies operating in our great state, differentiating yourself in the marketplace is essential. Maintaining the necessary licenses can help you establish credibility and help you to gain valuable experience in the solar industry.
What is the Contractors State License Board (CSLB)?
The Contractors State License Board (CSLB) is the California state agency responsible for regulating and licensing contractors in the state. It was formed nearly 100 years ago with the goal of establishing that certain ethical and competency standards are met in the business sector. CSLB has four main functions: licensing, regulation, consumer protection, and enforcement. In other words, CSLB generates criteria you must meet in order to legally operate your business, adapts regulations designed to maintain those criteria, provides resources and support for consumers who run into problems with contractors, and enforces action against those who perform substandard work.
CSLB wasn’t created to be a thorn in the side of solar professionals. Instead, it serves a purpose that is vital to both consumers and contractors in our industry. The rules and regulations established by CSLB help to create a solid framework for expectations, ultimately aiming to protect both consumers and contractors by ensuring a fair and professional marketplace.
Leading up to 1929, fraud and unprofessional conduct were running rampant. Unqualified individuals posed as skilled contractors, and countless innocent people fell victim to their lies. A growing number of complaints of poor workmanship (that is, if they delivered at all!) built up to major financial losses for consumers. To put it simply, scams were an alarming trend on a massive scale. And when they did wish to challenge the issue, customers were left without recourse.
Enter CSLB, which, as part of the California State Contractors License Law of 1929, would establish and enforce professional standards as a way to protect the public from ill-intentioned contractors. This regulation made it necessary for you to get a license to sell solar technology in California. Over time, the organization’s emphasis on transparency, improved quality, and regulatory oversight has greatly improved the reputation of California’s construction industry.
What License Do I Need to Sell Solar in California?
If you want to sell solar panels in California, you must first secure a Home Improvement Salesperson (HIS) License. This designation is granted through the Contractors State License Board (CSLB). And it’s a pretty big deal: unless you have properly completed your HIS registration, you’re barred from selling solar in California and there are hefty penalties for noncompliance.
Officially speaking, CSLB defines a “home improvement salesperson” based on California’s Business and Professions Code (BPC). According to BPC, a home improvement salesperson is anyone who is employed by a licensed contractor to solicit, sell, negotiate, or execute contracts for which home improvements (i.e. installation of solar panels) may be performed. The HIS designation showcases your qualification to perform installations and comply with all relevant industry regulations. You must have this license to sell solar panels in California.
Requirements for Your HIS License
In order to be eligible for an HIS license, you must meet several requirements. First and foremost, you have to be at least 18 years old to apply. After you have checked this box, the next step is to ensure you have a valid social security number or taxpayer identification number.
It’s important to note that a background check is part of the application process. If you have ever been convicted of a crime, including DUIs and other Vehicle Code violations resulting in a conviction, this information will be reported to the Contractors State License Board (CSLB). This applies even if you pled “no contest,” had the conviction set aside, or had the judgment deferred (commonly understood as “expunged”). However, having a criminal record does not automatically disqualify you from obtaining a license. Each application is reviewed individually based on the applicable sections of the law.
When assessing criminal convictions, CSLB considers several factors, including the nature and severity of the crimes, the amount of time that has passed since the convictions, and any evidence of rehabilitation that you may provide. CSLB has specific regulations for evaluating whether a crime is substantially related to the qualifications, duties, or functions of a licensee or registrant and determining if sufficient evidence of rehabilitation has been demonstrated. If CSLB requests additional information regarding your criminal history, you may need to provide mitigating evidence to support your application. Note that there is a background check involved in the application process.
Though you only have to be 18 to apply, that doesn’t mean you should rush into things. Label us late-bloomers, but we don’t recommend applying until you have allowed ample time to immerse yourself in your training and experience. Many successful salespeople started as humble door knockers setting appointments. Make the most of time in the field to commit yourself to mastering all there is to know about solar technology.
Increase your chances of success by moving through this process at your own pace. Those who rush tend to miss the mark when out in the field, and get frustrated or burnt out from early failures. Instead, opt to over-prepare. It will increase your chances of earning back your application fee quickly.
How is an HIS License Obtained?
Thankfully, CSLB keeps it simple. The registration process can be completed via an easy-fill application accessible on the official CSLB website. Give yourself enough time to complete the entire form in one sitting, since this isn’t a form you can save partway through and come back. Upon completion, you’ll need to print your application and deliver a hard copy straight to the CSLB offices.
You must also pay a nonrefundable $200 mandatory fee when submitting your HIS application. If your application is inaccurate or incomplete, it will be mailed back to you and you will have 90 days to correct it. After 90 days, your application becomes void and cannot be reinstated. Instead, you’ll have to submit a new application – and hand over an additional $200 fee.
Keep in mind that we take this regulation seriously. In order to be our partner, you are required to have an HIS license. Any projects submitted to us that don’t have a valid HIS license will be placed on hold until the proper requirements with CSLB can be met.
Why the HIS License is Important for Your Solar Business
Being a solar contractor is serious business. Our promise to all our partners and customers is that we are experts in delivering solar technology to any homeowner who wants it and qualifies for it. The sales process is the first critical step, but there’s a lot that goes into the engineering and construction side of it, and that’s where ESP shines. The complicated nature of our industry makes licensing and regulations wholly necessary for all parties involved.
Next time you think to yourself, “Do I need a license to sell solar in California?” remember the importance of industry standards. It’s one thing to change out all your light fixtures; any relatively capable person can handle that task. To equip your whole house with solar equipment to power all your lights and appliances via the sun is a whole different scale of home improvement and construction project. Just as you would not hire a lawyer who has not passed the bar, you can’t expect your potential customers to feel comfortable hiring an unlicensed solar professional for their energy needs. License requirements help to maintain proper procedures and protocols in the marketplace.
Earning the mandatory HIS license is just the first step. Aspiring solar professionals must be keen to develop a thorough understanding of the industry. You should become familiar with how the technology works, how homeowners can take advantage of various programs, and also how industry regulations impact your sales pitch. When you’re ready to go prospecting, this knowledge will prove immensely helpful as the contracts you present to your potential clients must always adhere to California’s licensing requirements.
As always, you should check local laws before conducting new business. Depending upon your jurisdiction, you may not have legal authority to operate your solar sales business unless you hold a certain license or certification.
Stay Credible and Trustworthy: Avoid Making False Claims
No matter how badly you want to close a difficult prospect, never, ever state a false claim in an effort to make the sale. The CSLB urges consumers to be on the lookout for contractors who make lofty promises and provide untrue information. For this reason, you must emphasize transparency during all of your interactions with potential and current customers.
We demand our solar sales reps to be fully transparent about the cost of installation and any projected energy cost savings. Providing false information – whether intentionally or not – can get you into serious trouble with the CSLB. You are required to provide your prospects with a completed Solar Energy System Disclosure Document. The CSLB provides this mandatory form on its website and it is automatically included in all Homeowner Installation Agreements when you’re an authorized dealer with ESP. Do not ever modify or create your own version. You must use the official document provided by the CSLB.
California law requires sales professionals to outline contract terms before a client can sign. While it can be tedious to have someone review every line of an agreement, don’t allow your clients to sign if you have not taken the time to review the importance of each section. Gaining assurance that they understand the nature of your agreement can help you to prevent the possibility of a major dispute later on.
Making false claims can ultimately result in you losing your HIS designation. When you become a licensed solar professional, your credibility with customers increases. On the flip side, losing your license – or failing to ever acquire it – is an immediate way to diminish trust. As the old Proverb says, “Trust is like glass; once shattered, even the tiniest cracks are visible forever.” Indeed, once you have lost trust, the marketplace is likely to remain skeptical of your intentions and abilities.
What if a Client Wants to Cancel?
The CSLB states that consumers have, at minimum, three days to cancel their contract with you. If the individual is 65 years of age or older, they have a minimum of five days to terminate the agreement. This can be done by email, mail, fax, or personally delivering a notice before midnight on the third business day after you executed a signed contract.
No, the client does not need to provide you with any reason nor are they required to have one. If the contract was negotiated at your office, there may be exceptions to this rule. Otherwise, you are legally obligated to cancel the contract at no penalty to the customer within this Right To Cancel period.
3 Questions CSLB Urges Your Customers to Ask
In an effort to foster a more educated consumer base, the CSLB encourages people to ask solar providers the following questions:
- What is the business’ CSLB license or registration number?
- ESP’s license number is #619149, and is listed prominently on the agreement. Your individual HIS license number will also be included when you populate an agreement to be signed.
- What is the total cost of the solar energy system?
- If I sell my home, what are my options and what do I need to do?
Study these questions intently. Be prepared to answer them all – and with every customer. Your unwillingness or inability to provide answers will serve as a warning to educated consumers; surely they will reconsider doing business with you. After all, CSLB recommends a person obtain at least three proposals from different solar energy companies. Increase your chances of becoming the chosen provider by thoroughly and thoughtfully answering the above questions and any others a client may ask you.
The Solar Consumer Protection Guide
The is a resource prepared by the California Public Utilities Commission (CPUC), the government agency tasks with regulating privately-owned utilities. The California Solar Consumer Protection Act makes it state law for contractors to provide the guide to customers before they sign a contract for a solar energy solution. The guide outlines a consumer’s rights, responsibilities, and other information essential to the solar installation process.
In the guide, your customers will be armed with the necessary information to make an informed decision on whether or not solar panels are the right fit for them financially. The document includes tons of information on how electricity bill savings work, available financing options, and other hot-button money matters. It’s important that you fully understand the specific, personalized payment plan you are proposing to the customer – do not simply rely on the guide to provide important financial information. You are still obligated to discuss the details and nuances of financing of each solar project with your customers.
The guide walks consumers through a typical rooftop solar process, denoting important responsibilities before and after a contract is signed. It provides consumers with a checklist of items they should complete before entering into an agreement with you. Some of these include getting a home energy assessment, evaluating low-income solar programs, and deciding if rooftop solar is a good fit for them. Before a contract is signed, solar providers are expected to provide a Solar Energy Disclosure Document.
After a contract is signed, solar providers are expected to finalize the system’s design, submit applications to interconnect to the grid, and submit city/county inspection approval to the electricity provider. We encourage you to develop a strong understanding of who is responsible for what throughout the entire process. As a result, you are sure to deliver an expert solar system in a timely and professional manner, delighting your customers.
Although the 24-page document was designed to help consumers make informed decisions, it serves as a method of protection for contractors, too. The last two pages of the Solar Consumer Protection Guide features a required signature section where both consumer and contractor must sign to acknowledge understanding of the information provided. The signature requirement does not apply to new home construction, multifamily buildings, or solar thermal systems.
At Energy Service Partners, we pride ourselves in assisting the best and brightest solar professionals to reach their peak potential. Once you have earned your HIS license, contact us to learn how our solar dealer program can help you grow your business. We’re eager to introduce you to our platform which provides services that are sure to guide you to a successful career as a solar sales professional.