Author: Brett Knox
July 9, 2024 - 6 MIN. READ
There is a nationwide push to replace fossil fuels with electricity. This process, known as electrification, is happening in every sector of the economy. Consumers are also embracing it by adopting electric alternatives for transportation, heating, cooling, and appliances.
The electrification market is set to continue its rapid expansion, and electrical contractors who explore opportunities in the residential electrification sector will undoubtedly benefit.
The Top 8 Reasons to Focus on Residential Electrification
Residential electrification is creating opportunities for electrical contractors in multiple areas, including at-home EV charging, electric heating and cooling, renewables integration, and the adoption of energy-efficient appliances. Experts predict that 48 million homes will need panel upgrades to fully electrify, highlighting the scope of these opportunities.
Below are our top eight reasons to specialize in residential electrification.
1. There's a Growing Demand for Residential Electrification
Policies at the federal, state, and local levels are driving demand for electrification expertise. Consumers can qualify for electrification rebates in the form of tax credits introduced by the Inflation Reduction Act and save on an EV purchase thanks to state programs that waive sales taxes.
Several states are taking additional steps to develop a modern energy infrastructure, phase out ICE vehicle sales, and make EV charging more accessible. These factors are contributing to the projected 20% increase in EV sales for 2024.
Demand also stems from consumers looking for ways to reduce utility bills, stop paying for gasoline, and embrace a sustainable lifestyle that aligns with their values. Read the CNET article on the cost of charging an EV vs. the cost of gasoline for an ICE vehicle.
2. Utilities are Incentivizing Electrification
Utilities are instrumental in supporting electrification with grid-scale projects that amplify the growing demand for clean electricity tied to the rising electrification rate.
Besides investing in modernizing the power infrastructure, utilities are supporting consumer electrification by offering electrification incentives. Consumers can qualify for reduced energy rates, rebates on EV charging equipment, or even free chargers.
These electrification incentives often require consumers to find a qualified installer on their own, which creates a new opportunity for you if your website promotes that you specialize in EV charger installations.
3. Electrification Offers Bigger Jobs
The average cost of electrification jobs is a strong argument for prioritizing this type of work. Electrification projects tend to be larger—and as much as five to ten times more than a typical repair job—and can carry a greater profit margin.
Unlike most electrical repair jobs, electrification projects often entail installing an EV charger on a dedicated circuit, an electric heat pump, or even a generator. These projects often require a panel or load management upgrade.
Besides creating opportunities to work on larger and more valuable jobs, contractors who embrace electrification can generate recurring revenues by offering maintenance plans for these new systems.
4. Electrification is a Differentiator
Electrification is growing by the day, and consumers need reliable contractors to navigate the latest technologies.
As a electrification expert, you can stand out from other electrical contractors by educating your audience about electrification benefits, regulations, and incentives. You can also position yourself as a trusted advisor who can assess changing energy and home automation needs and recommend the best solutions.
5. You Can Cash in on Reviews and Word-of-Mouth Marketing
Consumers who invest in electrification often seek a sustainable lifestyle. Offering solutions that align with their values will help you build a loyal customer base.
Customers bragging about their new EV chargers on social media or writing positive reviews for your business will directly support growth and word-of-mouth marketing for your business.
6. The New Generation of Electricians is Going Green
Close to one in three union electricians is approaching retirement. The sector faces a significant labor shortage as fewer Americans choose a career in the trade. The labor pool could shrink by 14% between 2023 and 2030.
Specializing in electrification could be a solution. Providing electrification services makes your company attractive to young electricians looking for a career that feels meaningful. Providing a progressive service makes them more likely to gravitate to your business over a legacy contractor's.
7. Your Past Clients Need Electrification Upgrades
Pivoting to residential electrification creates new opportunities for your business. You can reach out to existing customers and present them with a new value proposition.
Trust has already been established with this audience, and you can use your knowledge of their needs and pain points to highlight relevant electrification benefits.
Electrification expertise will also create opportunities in new niches. For instance, you could partner with construction companies as more cities adopt EV charging ordinances and require new buildings to be EV-ready. Multifamily properties are another niche to explore since heat pumps or mini-splits for apartments are emerging as an effective way of managing heating costs.
8. Electrification Sparks New Partnerships and Referrals
The market for electrifying heating and cooling is rapidly growing, with the heat pump sector alone expected to grow at a CAGR of 9.8%.
HVAC contractors are shifting their focus to these modern solutions to unlock growth. However, electric heating and cooling solutions need to run on dedicated circuits and meet specific wiring requirements outlined in the NEC, requiring the expertise of an electrical contractor.
Partnering with local HVAC contractors will give you exposure to new opportunities as the demand for heat pumps increases. This tactic can also result in referrals for electrical panel upgrades as a prerequisite to installing electric heating and cooling solutions.
What’s Next for Electrical Contractors Interested in Residential Electrification?
You can start by familiarizing yourself with the various electrification technologies and assessing the demand in your area. There are many opportunities to explore, but you might want to focus on a specific area to get started.
You should also look into upskilling. One of the first things you can do is obtain an EVITP certification to access EV charging jobs.
EV Charging
EV charging, including at-home EV charging, is a lucrative market as more consumers invest in EVs and existing EV owners invest in new solutions like bi-directional charging. Gaining experience in this sector can lead to larger jobs, such as helping to develop the public charging infrastructure or installing chargers for commercial fleets.
Renewables and Energy Management
You can also focus on residential energy solutions such as solar integration, battery storage, and advanced energy management solutions. Consumers interested in these modern energy solutions might also be interested in smart home solutions like lighting automation, smart outlets, security cameras, and sprinklers.
Electric Heating and Cooling
The electric heating and cooling space is growing at a fast pace. Reach out to local HVAC contractors and work together to install space heating and cooling heat pumps, mini-splits, water heat pumps, and more.
Panel Upgrades
Installing electric panel upgrades is lucrative, and you can often bundle this job with other electrification services. You can differentiate yourself by becoming an expert in smart solutions like smart panels or installing PSP and DCC devices for load shedding and management.
Commercial Projects
Gaining experience in the residential space can lead to opportunities in the commercial electrification market. You could work on grid-scale projects for utilities, implement electrification solutions for commercial buildings, or install chargers at multifamily properties. [LINK TO ARTICLE 4]
Grow Your Electrification Business Faster and More Profitably
Offering electrification services is exciting for your business but it will take time and resources to learn the technical nuances and to determine which residential technologies you should sell and install for your customers. There is a lot of electrification equipment hitting the market but many of them are poor quality, unproven, and lack technical support assistance. Plus, how do you negotiate a good price on the equipment and supplies needed for your jobs?
Join a Purchasing Program like Raiven
Raiven is dedicated to saving electrical, HVAC, and plumbing contractors money on electrification equipment, electrical supplies, HVAC parts and equipment, and plumbing supplies. In addition, Raiven only offers electrification products that are certified and proven to work, including EV chargers, battery storage, load management devices, and more.
Gain access to pre-negotiated discounts of 7%-30% from industry-leading manufacturers and distributors in an easy-to-use purchasing platform, including ABB, Alpscontrols, ChargePoint, EnelX/Juicebox, Ferguson, Grainger, Graybar, HD Supply, Home Depot, Lowe’s, Office Depot, Sunbelt Rentals, Schneider Electric, United Rentals, and more!
How is all this possible? Raiven combines the buying power of all its members and negotiates deep discounts, service terms, and exclusive pricing agreements. You’ll pay less for EV charging stations, lighting, wire, panels, conduit, load management, tools, and more, and you don’t have to wrangle with suppliers.
Unlock unparalleled savings and streamline your procurement process with Raiven.
Visit Raiven to learn more about the benefits of joining a purchasing program and access deep savings on the equipment, parts, and materials you need!
Do You Need Electrification Leads and Jobs?
Qmerit can help you get started by connecting you to residential Level 2 EV charger installation jobs. Learn more about joining Qmerit’s network of certified installers.
