Solar Panel Business License Requirements
ComplianceAugust 01, 2022

Solar panel business license requirements

Solar energy is the fastest-growing energy source in the United States and is key to helping the nation achieve its climate goals.

According to a report by the U.S. Department of Energy, it has the potential to power 40% of the country's electricity by 2035.

Furthermore, the cost to install solar has dropped substantially — 60% in the last decade — making it a viable energy choice for more consumers and a lucrative business opportunity for solar panel installation companies.

If you’re interested in selling and installing solar panels as a business venture, you must obtain the right business licenses and permits. Here’s what you need to know about obtaining licenses for your solar installation business.

Do you need a license to install solar panels?

The solar contractor industry is regulated by state and local authorities, each with unique licensing laws and application requirements.

Many states require solar businesses to obtain a state contractor license. Depending on the state this could be a specific license for solar contracting or residential/home improvement. Solar business licenses are usually managed by a state contractors board. They administer examinations, evaluate experience, and issue licenses.

Solar is often listed as a specialty classification under a general electricity or plumbing license. This allows you to install solar panels without a specialty solar license.

At the local level, many counties, towns, and cities require contractors in their jurisdictions to be licensed and registered. In some states, such as New York and New Jersey, contractors are governed locally rather than statewide. Before installing solar panels on a residential or commercial building, make sure you have investigated these requirements.

Note: In addition, there are basic license and registration requirements for any business. For more information, see Do I need a business license or permit.

What is the process for obtaining a solar contracting license?

The application process varies, and you may be required to submit a variety of documentation to become licensed. This can include proof of experience, examination, course certification, bonding, and/or a certificate of insurance.

Certain states offer reciprocity with other states (meaning the state will accept proof of licensure in your home state and waive the examination requirement). Reciprocity is typically limited to a few states.

However, you must still go through the application process and meet all applicable licensing requirements. Also, the licensing state may not waive all examination requirements, and you may need to take an examination and participate in training courses.

Do you need a special license to sell solar panels?

Some states require businesses to obtain specific licenses to sell solar panels. If you solicit, sell, negotiate, or execute home improvement contracts for a licensed contractor, you may need to register with the Contractors State License Board (CSLB).

What other licensing and registration requirements impact solar contractors?

At the state level, you may need to register your business with the Secretary of State and register for sales tax. If you hire employees in that state, you must also register for payroll taxes.

If your business solicits door-to-door and doesn’t have a permanent location in a state, you may need to apply for an itinerant merchant or peddler license. Applications for this license involve providing proof of employment, driver’s license for each employee, vehicle registration, and dates/time of solicitation.

Fingerprints and background checks may also be required. Some towns and municipalities ban door-to-door solicitation, so do your research.

Is solar certification required for solar installers and salespeople?

Certification is an option for solar installers and salespeople. Leading certifications are available through the North American Board of Certified Energy Practitioners (NABCEP), a nationally recognized, independent organization that offers a variety of certifications.

NABCEP certifications are voluntary — with exceptions. If you intend to install solar systems that are eligible for state incentive programs, NABCEP certification is mandatory or preferred. In some states, the certification is also a prerequisite for qualifying for a state solar contractor license.

Lastly, some states require that a solar panel system is installed by a NABCEP-certified contractor for the system to be eligible for state rebate funds.


Operating a solar panel business is rewarding but can also be time-consuming — especially when it comes to keeping up with laws and regulations.

CT Corporation can help you stay up to date with changing requirements and forms so you can focus on your clients and the job at hand. Our business formation solutions help you get your business incorporated and our business license solutions help you get the licenses you need efficiently and correctly.

To learn more about how CT Corporation can help you manage your business license needs, contact a CT Corporation Service Representative or call (844) 701-2064.

The CT Corporation staff is comprised of experts, offering global, regional, and local expertise on registered agent, incorporation, and legal entity compliance.

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