Solar power, no money down, could prove profitable

Solar power, no money down, could prove profitable

Summary: You get a solar installation, you could get positive cash flow, and you pay no money down. Sounds like an offer you might read in some spam note from Bulgaria.

TOPICS: Telcos

sc_logoj.JPG You get a solar installation, you could get positive cash flow, and you pay no money down. Sounds like an offer you might read in some spam note from Bulgaria. But it's a legitimate offer from an legitimate cleantech company in California and Arizona. Solar City is about to celebrate its second birthday...on the Fourth of July. Funded by VCs like Draper Fisher and Elon Musk (you know, Tesla Motors and Paypal), plus a little input from an old-timer, JP Morgan.

True to their Silicon Valley roots, Solar City's biggest commercial installation is on the eBay campus in San Jose. And eBay's solar system is the largest commercial installation anywhere in Santa Clara, California, which includes a major portion of Silicon Valley. solar-city.jpg

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The two brothers who started Solar City figured there were two major obstalces to the success of solar technology for generating electricity. There was a lack of understanding among home owners and businesses...and then there was the need for a significant capital expense up front. They assumed the pressure of higher and higher energy prices [let us quickly note that crude oil is now about $140 per barrel] would force self-education by the folks paying for that energy. So they set about fixing the other problem. They buy the solar components from major manufacturers, build and install the systems, then lease the electricity generated to the property owner.

I talked with Lyndon Rive who co-founded Solar City with his brother, Peter. They were the first employees at Solar City. Remember that was just two years ago. Today, said Lyndon, they have 300 employees. He was proud to say they do all their own work, not contracting it out. The Solar Citites even get employee benefits. And this in 2008.

Rive pointed out it's wise for potential solar power users to get solarized now while state and federal rebates and subsidies are worthwhile. Most pro-solar programs are set to diminish over time so there'll be little savings for the buyers even if solar components do decrease in cost as the industry grows.


Rive says they tell customers in California and Arizona--where they currently operate--that a $100 $150 per monthy electricity bill now means they would actually save money with a Solar City most cases. Not if you live in the redwoods, of course. But a majority of homes have access to a plentitude of free solar energy once the photovoltaic system's installed.

And the electricity produced by the solar panels can be "net metered." That is, sold back to the local utility company. That is required under federal law: homeowners and businesses generating power with solar or wind or gerbils-on-treadmill are allowed to sell back any surplus power to the utility company. In some cases this is simply done via a reversible electric meter.


Solar City says many customers leasing their systems pay less now for electricity, the combined lease payment and any electricity bill being less than the former electricity bills.

Solar City seems to be on a move to expand, so there may be more than just California and Arizona getting their services soon.

Topic: Telcos

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  • Not so fast...

    I have the perfect roof for this: South facing, steep pitch, no trees, and in Florida. So you'd think I would be a perfect candidate, right? Even with Florida's rebates and net metering, I wouldn't see breakeven until around year 35--about a decade past the warranty and longer than most systems are rated for.

    If electricity jumps 50% in price to $0.15 here in Tampa, I will re-examine the numbers. But for now, centrally generated power is way cheaper.
    • Look Again...

      First, have you read about the new panels from NanoSolar?

      NanoSolar's products are less expensive than the old arrays, and
      they have a material that is basically peel-and-stick.... you could
      put these flexible cells on the hood of your car.

      More importantly, have you considered solar thermal instead?

      Solar thermal gets you about six times as much energy as from a
      photocell array the same size.

      In Florida you could put in Solar Thermal for free hot water for
      showers, washing clothes, heating a pool or hot tub... and payback
      would be much faster than photocells.

      And if you're creative, you could set up a Stirling engine to extract
      electricity from the hot water stream.

      There's been some very recent developments in converting heat to
      electricity directly that look interesting.

      The best of these prefer a temperature differential way above
      boiling to cold water, but it's tempting to imagine further
      developments bringing that down a bit.

      Imagine a simple setup with heated water on one side of the
      thermoelectric material and cold groundwater on the other: Any
      power you pull from that would be gravy.
  • Third obstacle

    There simply isn't enough energy in incident sunlight.

    Let's do a little comparison.

    Energy in sunlight striking one square meter of the earth's
    surface: 1 kilowatt hour.

    Energy in 1 kg of uranium 235 (that's a cube 2 inches square).
    18.7 million kilowatt hours.

    People pushing solar power are idiots.
    • Edjucate Yourself ...

      There has never been a nuclear power plant that puts all costs from uranium mining to final storage on the energy produced.

      There has never been a nuclear power plant that was given the assumption above been able to make profits ...

      Google for Andasol and Solar Millennium, this will be cheaper than nuclear by 2020 ... I'd bet.
  • Expects in Realestate

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  • Lower leases are the absolute worse

    Unfortunately, no money down solar leases and PPAs are two of the most expensive ways to have solar on your roof. A zero down solar lease will typically cost a homeowner more than 3 times what he or she would have paid had the system been purchased instead. In fact you'll pay so much more for a leased system that it will actually be you, who will be paying for your own repairs, insurance and monitoring many, many times over. Don't believe it ? Do the math. Add up your lease payments including the annual payment escalator over 20 years on that $0 down solar lease and then compare that to purchasing an installed system at today's much lower pricing of less than $2.10 per watt after the incentives are applied, and there you have it. More than 3 times the cost when you lease.

    And good luck if you ever want to sell your home with a solar lease attached to it. What home buyer will want to assume your lease on a used solar system, when they can buy a brand new solar system and keep the incentives for tens of thousands less than your remaining lease payments Don't become a solar sheep. Shop before you sign that 20 year contract !