Solar City Offering No Money Down, Residential Solar Panel Leases In California
by John Laumer, Philadelphia on 04.16.08
The financials look pretty good.
Under the program, customers pay a monthly fee and get lower utility bills, but SolarCity retains ownership of the photovoltaic panels.Think about it. Mr. Musk is certainly a good business strategist. Charge up the newTesla in your own garage, on free electricity - well, sort of. Anyway, that's pretty slick.In a typical scenario for a 2.8-kilowatt system, Rive said, a customer with a $150-a-month electric bill before installing solar would end up with a $60-a-month electric bill, an $80 or $90 monthly lease payment to Solar City, and thus "positive cash flow" of as much as $10.
Founded in 2006, SolarCity is chaired by Elon Musk, who also chairs Tesla Motors, and has heavily invested in both companies.
Via::Mercury News;SiliconValley.com, "SolarCity offers solar-leasing contract for no money down" Image credit::SolarCity website.
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am i understanding correctly - the monthly bill is practically the same the only difference is that you are using green electricity? its enough incentive for me. what would be great would be a system where you could buy the panels off slowly
This is how solar will go mainstream.
The lease portion of this is like locking in to a fixed utility rate for the life of the lease. If it is a 20 year lease and elect. rates rose at only %4, its easy to predict substantial savings over time. Combine this with increased efficiency to eliminate the $60. and its a sweet deal.
This is the same concept as rethinksolar.com. Of course, I am not sure they ever got off the ground.
The system does not have batteries; it requires for your utility to do reverse billing. During the day while the house is empty, you are selling to the power company. By night you get it back.
If this model takes off, they won't be able to make panels fast enough.
Does that mean that instead of paying $150 per month, you would instead pay $60 + $80 - 90 = $140 to $150 per month? Meaning that you would ultimately only save up to $10 per month?
I think that there is going to need to be a more substantial savings of money before this gains mass appeal. It may be enough to us treehuggers to install the solar panels but not to most people.
This makes absolutely no sense. Assuming that a 2.8kW system costs approximately $20,000 (around $7 per watt), with a 6% interest rate loan, that would be about $110 per month, give or take. So why lease the system when you can actually own it for less?
@ed: That is how leases make a viable business model. You pay more money in the long run for something you want but can't afford out right.
Did John Laumer run off with my better business model post or is he invested in Solar City?
How about instead of leasing they also offer a finance option? If you can compare this to cars, wouldn't a lease be tougher to get than financing from a credit rating aspect? I'm all for this idea but it would bring more satisfaction if Its lease to buy or finance to buy.
I just signed up.
With zero down payment I will end up paying about $55 less per month and be producing my own green power.
To me it's a no brainer if you plan on staying in your home for another 5-10 years. The zero up front cost is just awesome. I looked into other leading companies and this was the best by far I found.
5.7 kw system $124 plus tax per month
I am seriously considering this. Since I use a rediculous amount of power I will be saving about $215 per month if I go with Solor City. I'd love to email one on one with current users of Solor City's lease program. Please email me danielfury@yahoo.com.
If someone has any info on other methods of aquiring solor with out much, if any, downpayment and resonable mothly payments I'd love to hear about them.
My sales rep with Solar City was like a used car salesman, who tried to pull a bait and switch. For the same system he provided me 3 different prices, after telling me that all of the system pricing is fixed.
I would never ever do business with Solar City after working with this sales rep.
We signed up for it and are waiting for the site auditor to come out.
Leasing does make sense to us because of the convenience. Also, if you buy solar (who's willing to fork out $25K plus cost of installation?) you have to maintain it yourself or pay more for the solar provider to maintain your system. So you need to factor in the support costs when purchasing.
Southern California Edison (SCE) is our electric company and they use primarily natural gas to run their electric plants. From the research that I have done, it won't be long until the prices of natural gas to start rising like oil. SCE is already saying that electricity will go up by as much as 30% in Jan 2009. By going with Solar City, I expect to get a much greater savings faster than what was presented to me.
We signed up for it and are waiting for the site auditor to come out.
Leasing does make sense to us because of the convenience. Also, if you buy solar (who's willing to fork out $25K plus cost of installation?) you have to maintain it yourself or pay more for the solar provider to maintain your system. So you need to factor in the support costs when purchasing.
Southern California Edison (SCE) is our electric company and they use primarily natural gas to run their electric plants. From the research that I have done, it won't be long until the prices of natural gas to start rising like oil. SCE is already saying that electricity will go up by as much as 30% in Jan 2009. By going with Solar City, I expect to get a much greater savings faster than what was presented to me.
We live on Whidbey Island just north of Seattle and are looking for a similar program up here. Please email me if you have any info.
Thanks,
RA
In reference to a comment several lines back actually there is no yearly fix on the cost per month. In fact my understanding is that it increases about 3% a year. The panels isn't the expensive part it's all of the other equipment needed to run it.
terrible business model
Our electric bill is an insane $700+ per month on PG&E
this saves us $20/month and we don't even own the stuff
why would we even bother the hassle....... please come up with a real cost savings, not a measly $10/20 per month.
people It is actually cheaper to get the device for yourself. I guess what makes it difficult is tax and laws governing the use of solar photovoltaics to generate electricity. Probably.
When you lease a solar system you don't get the new 30% tax credit or the huge cash rebate or the valuable RECs(renewable energy credits) and all you'd be lucky to save is about $25.00 a month on a typical $250.00 electric bill after going through all the trouble of being locked into a lease for all those years. And after more than 10 to 15 years of lease payments you will own absolutely nothing. You're far better off to buy a system using traditional financing. Not only will you get all of the financial incentives mentioned above but you'll also own a system with a 30 to 40 year life expectancy that will put cash into your pocket every month for another 20 to 30 years after you've paid the system off. And that's even considering the replacement of the inverter after 12 to 15 years. Lease a solar system.....I don't think so ! Buying one makes alot more sense. Why do you think the leasing companies BUY solar systems, take all of the financial incentives for themselves then turn around and lease systems to homeowners.