How I’d Get to Below $2/Watt (in 5 Not-So-Easy Steps)

How I’d Get to Below $2/Watt (in 5 Not-So-Easy Steps)

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If you're reading this right as it drops, chances are you're waiting with bated breath to see what the 2025 U.S. Federal Budget Bill (yes, the dramatically titled Big Beautiful Bill Act) has in store for the solar industry and the country at large.

If you're reading this from the 99.99% of future timelines where the bill has already passed (or crashed and burned), this blog will either seem oddly prescient... or straight-up hilarious.

But as of this moment, let’s assume you’re a rooftop solar executive in the U.S., staring down the possibility of a post-ITC world. That 30% tax credit? Gone.

You’re left holding the proverbial bag, wondering how you’re supposed to stay afloat—let alone thrive—when solar physics and economics have to stand on their own two feet without Uncle Sam spotting the bill.

Now, I’ve been there. I used to run an 8-figure rooftop solar installation business, and during those years I spent way too much time obsessing over how to get the installed cost of solar down to below $2/Watt.

Spoiler alert: I never got there.

And frankly, I didn’t need to.

We were growing steadily with install costs at $2.50–$3.00/Watt, so the urgency to push the cost curve down just wasn’t there. But today? That kind of urgency is critical if we want solar to remain affordable and expand access beyond homeowners with $10,000+ in tax liability.

So, if I were starting over—or trying to future-proof a business in a no-ITC world—here are the five big levers I’d pull to get my costs below $2/Watt. Each strategy is ranked by impact, based on the assumption that you’re currently installing 500 systems per year at an average 10kW size and $2.50/Watt cost.

Automation, Automation, Automation

If software or AI can do it, then now is the time to find out and implement it.

Construction is notoriously one of the least digitized industry (behind only farming and fishing!), and with some smaller shops, it can be apparent. Everything is done manually: paperwork, project updates, and never-ending homeowner questions like “Where’s my permit?” or “How do I reset my inverter WiFi?”

All of this chews up thousands of hours that could be saved with better software and automation. Customer comms, document delivery, inverter guides—you name it—should be handled automatically. If software or AI can do it, let it.

Say you reduce two project manager roles at $50K/year because software picks up the slack. That's about $0.02/Watt saved right there! Plus, your remaining team gets to focus on high-impact work, not inbox babysitting.

Trim Sales Commissions

Now, I know this one stings—but hear me out:

We all know who the biggest winners of the ITC era have been: solar salespeople.

Many are hardworking, ethical, and genuinely great with customers. But let’s not pretend they’re not sometimes making more than the owners or licensed electricians who are literally signing off on the system and putting their house on the line with a personal guarantee.

If your sales commission is 5% of the contract value, trimming it to 3% could save you $0.05/Watt without forcing anyone to survive on instant noodles. With smart marketing and better-qualified inbound leads (we’ll get to that), your reps can still make a great living…just with less padding.

Turn Your Customers into Your Marketing Department

Okay, yes, I’ve said this before (and blogged about it). But it bears repeating: if your Customer Acquisition Cost (CAC) is still hovering between $1,500–$2,000, you are going to have a hard time getting to $2/Watt. Period.

You simply cannot afford to sell $25,000 systems with $2,000 CACs in a post-ITC world. The math doesn’t work.

Instead, you need to turn your happiest customers into your loudest marketers. That means:

  • Delivering an A+ experience
  • Making it easy for them to review and refer
  • Building systems to ask for testimonials
  • Gamifying referrals
  • Creating personalized referral pages (yes, these work)

If you can cut your CAC in half, like from $2,000 to $1,000, by doubling your referral rate, that’s a $0.10/Watt savings. And more importantly, it’s a flywheel that gets more powerful the longer you run it.

Consider Outsourcing Your Installs

Deep breath. I know this is a sacred cow for many. But let’s talk.

The idea of outsourcing your installs can sound like blasphemy, especially if you’ve worked hard to become vertically integrated. And yes, many solar veterans have horror stories about bad subcontractors. But in some markets, running an internal install crew just doesn’t pencil out anymore.

Here’s what I’d suggest:

  • Don’t outsource blindly. Vet your subcontractors with extreme prejudice.
  • Maintain strict QA/QC on every project.
  • Offer your best internal crew a 1099 option at higher pay per watt, giving them autonomy and incentive while reducing your overhead.

You might be paying $0.35/Watt today for internal labor, but after payroll taxes, benefits, and warehouse logistics, the true cost is likely higher. By shifting to a leaner model and possibly even closing your warehouse, you can realistically save $0.15/Watt, and maybe even boost morale in the process.

Value-Based Equipment

It doesn’t get much more obvious than this, but of course it must be said out loud.

If you're paying $1.00/Watt for premium modules and micro-inverters, you're leaving money on the table.

Now, I love a sleek, all-black panel and the simplicity of micros as much as the next person, but consumers care most about ROI and reliability. You can shave off serious dollars by choosing:

  • Value-tier modules (slightly less efficient or aesthetic)
  • Commercial-style modules in residential installs
  • Centralized string inverters instead of micros

On average, switching to string saves $0.20/Watt, and using value modules saves another $0.10/Watt, for a total of $0.30/Watt saved, without sacrificing performance.

Add It All Up...

Let’s do the math:

  • Automation: $0.02/W
  • Commission trims: $0.05/W
  • Customer-driven marketing: $0.10/W
  • Outsourced installs: $0.15/W
  • Value-based equipment: $0.30/W

That’s $0.62/Watt in total potential savings, bringing your cost down from $2.50/W to $1.88/Watt.

Final Thoughts

Will it be easy? Absolutely not.

But it’s important to know that there are companies already doing this. I’ve met them. They’ve been selling at below $2/W for years by operating lean, automating smartly, and relentlessly improving every corner of their business.

And they’re absolutely crushing it!

If the ITC disappears, you’ll need to follow suit—or risk being left behind.

So the question isn’t can you get below $2/W. The question is: Will you?

From "aha" to "oh crap", we’re sharing everything on our journey to help install 100,000 residential solar systems per year.

We’re learning a lot and so will you.

Residential solar systems installed through Sunvoy in the past year:

025,00050,00075,000100,000

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written byJoe MarhamatiVice PresidentJoe is the Co-Founder and COO of Ipsun Solar – a top residential solar installer in Washington DC with 60+ employees and $10M+ in annual revenue.Read more »
Joe Marhamati
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