Originally published on the CNY Business Journal by Traci DeLore on 12/6/2019
CLAY — Nickels Energy Solutions, LLC is wrapping up a year that saw the company move into some new office space and complete 60 solar-installation projects. However, the firm faces some new challenges in the solar industry heading into 2020.
Brothers Steve and Kevin Nickels founded Nickels Energy Solutions in 2015 as a way to channel their growing interest in solar energy.
Steve Nickels, who serves as the company’s president and specializes in project and design management, graduated from the Rochester Institute of Technology in 2011 and went to work in the solar industry in Maryland. Kevin Nickels, VP and head of sales and marketing for the company, graduated from LeMoyne College in 2013 and pursued a career in sales.
Both brothers, with their different backgrounds, felt drawn to the solar industry. “Solar was something I knew I could feel passionate about,” Kevin Nickels says.
The pair brought their different skill sets together to form Nickels Energy Solutions (www.nickelsenergysolutions.com) and complete their first solar installation for their uncle in late 2015. That first project helped them build contacts with distributers, permitting officials, and more, Nickels says.
Things just kept rolling from there and the company completed 16 solar-project installations in 2016, he says.
Since then, primarily through word of mouth and attendance at home and garden trade shows, the company has grown steadily and sustainably, Nickels says.
Today, Nickels Energy Solutions employs 10 full-time and part-time employees including the Nickels brothers, he says. The company also just moved into its first-ever office space at 4575 Buckley Road in Clay. While client meetings continue to take place at the client’s home, having the 1,000-square-foot space at which everyone can start and end the day together has really helped foster the company culture, Nickels says.
This year, Nickels Energy Solutions will complete at least 60 projects for more than $1 million in sales. That’s up from 39 projects in 2018. Going forward, the company hopes to maintain that sales level and build on it, Nickels says.
One hurdle the company faces is the Jan. 1 reduction in the federal tax credit for solar projects. Currently, the credit is 30 percent of the project cost, but that will drop to 26 percent in the new year.
To help push sales in the new year, Nickels says the firm will make sure potential customers know that credit will drop another 4 percent in 2021.
The other stumbling block Nickels Energy Solutions must navigate is a change in how utilities compensate residential solar producers for excess energy they provide back to the grid. In the past, the net metering system was a “very fair system” for compensating solar energy producers, Nickels says. Typically, it’s been a kilowatt-hour for kilowatt-hour exchange.
Beginning Jan. 1, the Value of Distributed Energy Resources (VDER) policy phases out net metering for a system where utilities set how much they will pay. Utilities determine the value by a variety of factors that can cause the reimbursement value to fluctuate.
These changes are a challenge, Nickels notes. “These two factors will result in a slightly longer payback,” for a solar project, he says.
However, he does not think they are insurmountable obstacles. Solar energy will still reduce a homeowner’s electricity costs and still provide a sustainable and clean alternative for energy, he contends.
Nickels Energy Solutions is there for those who are interested in that clean and sustainable option, Nickels says