Tag Archives: Residential Solar Financing

U.S. solar industry battles ‘white privilege’ image problem

By Nichola Groom, Reuters

Solar power companies have an image problem—and they are beginning to do something about it.

Despite a sharp drop in the price of solar panels and innovative financing plans that have brought the technology to many middle income households over the past decade, it is still seen as a luxury only rich, mostly white, consumers can afford. That perception both hampers solar expansion in less affluent communities and drives political opposition to initiatives promoting greater use of solar power as a renewable alternative to gas, oil and coal.

Though it has grown dramatically in recent years, solar power still makes up less than 1 percent of U.S. energy supplies and relies heavily on government incentives to compete with traditional energy sources. Those incentives help companies such as SolarCity, Sunrun and others market solar power contracts that offer customers 20 percent savings on their energy bills. However, the schemes come with certain credit requirements and are ill-suited for apartment dwellers, homes with low monthly bills or low-income households that qualify for reduced power rates.

Since minorities make up a disproportionate number of low-income households, some advocacy groups have opposed certain solar power initiatives arguing that they deepen social and racial inequality. Solar companies are now trying to tackle both the perceptions and the economics by pushing to diversify their workforce, forging alliances with minority groups, and making solar power more suitable for multi-family housing.

The stakes are particularly high in California, by far the top U.S. solar market where solar power is expected to make up more than 10 percent of the state’s power generation in 2015, according to IHS. Communities with median household incomes below $40,000 account for just 5 percent of installations in the state even though a third of California households fall into that category. That share has not changed over the past seven years even as solar installations in communities in the $55,000-$70,000 income bracket have risen to more than half of the total market.

Read full article from Reuters

New Report: Greatest Growth in Consumer Adoption of Solar Energy Among Middle Class

A new report on residential rooftop solar installations indicates the growth in California’s rooftop solar market is trending toward greater adoption by middle class households. The trend, seen over the course of eight years, aligns with a steady decline in the cost of solar power and in the increase of financing options.

The new study by Kevala Analytics analyzed California Public Utilities Commission (CPUC) solar interconnection data for 386,000 net metered solar systems installed from 2008-2015. The main takeaway conclusion from the study is that as solar deployment has expanded statewide, an increasing percentage of installations within that time frame are benefiting low- and middle-income median zip codes, with a decreasing fraction of installations in upper-income zip codes.

During these same eight years, there has been a steep decline in the adoption of solar among upper-income households contrasted with a recent increase in the market among the lowest-bracket incomes. In 2015, the statewide number of households in the highest income brackets matched the number in the lowest income brackets.

Read full press release from CALSEIA

The Silicon Valley Idea That’s Driving Solar Use Worldwide

By Mark Chediak & Christopher Martin, Bloomberg News

Silicon Valley has something to offer the world in the drive toward a clean energy economy. And it’s not technology.

It’s a financing formula. In a region that spawned tech giants Apple Inc. and Google and is famous for innovators and entrepreneurs like Steve Jobs, a handful of startups began offering to install solar panels on the homes of middle-class families in return for no-money down and monthly payments cheaper than a utility bill. This third-party leasing method — which made expensive clean energy gear affordable — ignited a rooftop solar revolution with annual U.S. home installations increasing 16-fold since 2008, according to the Solar Energy Industries Association and GTM Research.

“There is a reason why California is a tech Mecca for the world because the infrastructure is here to attract that talent,” said SolarCity Corp.’s Chief Executive Officer Lyndon Rive, whose company popularized third-party solar leases for homeowners starting in 2008. “All the major innovation is going to occur in California. One of the innovations is the financing of solar assets.”

SolarCity took the leasing model that SunEdison Inc. first developed for the solar industry by a graduate student named Jigar Shah. SolarCity adapted that model for residential consumers in 2008 and many more offered similar arrangements including Sunrun Inc., which developed the first one in September 2007, and Vivint Solar Inc. And now the idea is spreading to other industries trying to sell expensive capital equipment that reduce pollution and fossil fuel consumption.

Read full article from Bloomberg News

California Solar Costs & Value

By Jake Richardson, CleanTechnica (originally published on Solar Love)

There seems to be a lot of confusion about how much a home solar power system costs in the year 2015. Solar Power Now says the cost is about $3 per watt, or $15,000 for a 5,000 watt system, which seems to be about the average size for a single-family home. Actually, the size of the system will depend upon how much electricity that home uses, so you might need less than 5,000 watts. Obviously, the benefit is that then you would pay even less.

Did you know that solar power had dropped so much in price and become this cheap? Maybe not, because it does not seem that the public has caught up to the reality of what solar power currently costs. Even an official website managed by the state of California is using information from 2011. It says that the cost is $8.70 per watt and that a 4,000 watt system would cost about $34,000. A lot has changed in 4–5 years, but this website doesn’t reflect that.

If you could purchase a home solar system in California for somewhere between $15,000–25,000, you still get to subtract some of that cost due to incentives like the solar tax credit, which is still 30%. Then, there might also be some local incentives, so the overall cost could be even less.

Read full article at CleanTechnica

Clean-energy lender Renovate America tops $1 billion in loans

By Ivan Penn, The Los Angeles Times

A leading clean-energy lender has topped $1 billion in loans for home improvements — a milestone for the San Diego company as well as a once-foundering government program to encourage projects that reduce electricity or water use.

Renovate America got into the business in 2011 as the Property Assessed Clean Energy financing program, or PACE, was struggling to overcome opposition from mortgage lenders and federal housing regulators that had stalled the clean-energy lending effort. Since then, the lender has provided money to 44,000 households for efficiency projects in partnership with local governments using the Pace program. That represents not only a fast-growing source of revenue for Renovate America but also a gauge of the improving health of PACE programs.

PaceNow, a nonprofit organization that tracks use of the Pace programs nationwide, lists Renovate America as the top operation of lender among more than 100 members. Renovate America is the only one to reach $1 billion in financing, with more than 90% market share of all Pace programs, which operate in conjunction with local governments in 32 states and the District of Columbia.

Read full article in the Los Angeles Times

Rooftop Solar Brings Higher Home Appraisals

By Katherine Tweed, Greentech Media

Homes with rooftop solar are appraised at a higher value, according to new research from Lawrence Berkeley National Laboratory.

For the past few years, Berkeley Lab has been collecting data on the value of homes with solar photovoltaics compared to those without PV. Early studies relied on modeling and found that buyers were willing to pay an average of $15,000 more for a home with a solar PV array. Another study from January, based on survey data, found that homebuyers were also willing to pay a premium for leased systems.

The latest piece of research furthers those findings by assessing appraisals for PV homes in six markets within Oregon, California, North Carolina, Florida, Pennsylvania and Maryland. The appraisal premium ranged from about 3 percent to 6 percent based on the region, with a price boost of about $10,000 to $22,000. The valuations were based upon PV homes compared against comparable non-PV homes by local appraisers.

Read full article from Greentech Media

Most People Choose the Costliest Route to Going Solar

By Lisa Halverstadt, Voice of San Diego

The vast majority of new solar power customers in California are going solar in a way that costs them more money in the long run. About 70 percent of new solar customers in California are getting panels with leases or power purchase agreements, which has them paying for the energy their panels produce rather than regular monthly sums, according to a National Renewable Energy Laboratory analysis released earlier this year.

There are two big reasons for that. One is obvious. Cost-wise, going solar isn’t much different from any big purchase – people who buy solar panels come away with a better deal over the long haul, but leasing is attractive to people with less to spend up front and who don’t want to make the commitment.

There’s a big catch, though: Solar experts agree purchasing the panels usually pays off more over the long haul, especially with a federal tax credit that shaves up to 30 percent of the cost off both cash purchases and loans. Buyers immediately see energy bill savings, and once they recoup their upfront costs, those lower bills mean more money in the bank. Twenty or 30 years in, customers who lease or enter into a power purchase agreement with a solar company may still be paying – and end up spending far more than those who opted to buy.

The Renewable Energy Laboratory, the federal government’s energy think tank, concluded in a study earlier this year customers who get bank loans pay as much as 29 percent less per kilowatt hour of energy than those who go with a 20-year power purchase agreement, which bills customers based on the power their leased solar systems produce each month.

Read full article from Voice of San Diego

California Is Giving Poor Residents Solar Energy Using Polluting Companies’ Dollars

By Robbie Couch, The Huffington Post

California’s fight against global warming is providing green energy to low-income residents — and polluting companies are footing the bill. As the San Francisco Chronicle reported, about $14.7 million raised from the Golden State’s cap and trade system is going toward an initiative by nonprofit Grid Alternatives to install solar panels on homes in disadvantaged neighborhoods for free. The program reduces energy costs for families that could use the help, while simultaneously lessening their environmental footprints.

The state’s cap and trade approach limits the amount of greenhouse gases a company can emit and forces polluting companies — like oil refineries and power plants -— to purchase credit for each ton used. Grid Alternatives is now using those credits to help families save big.

Read full article from the Huffington Post

Low-income homeowners get free solar panels thanks to cap & trade

By David R. Baker, The San Francisco Chronicle

The spread of residential solar power has been largely a middle-class affair. A 2013 study by the liberal research and advocacy group Center for American Progress found that 67 percent of solar arrays installed in California went to ZIP codes with a median household income between $40,000 and $90,000. Wealthier areas accounted for almost all of the rest.

A new California program, however, aims to make solar power available to lower-income families — using money from the state’s fight against global warming. Run by Oakland nonprofit Grid Alternatives, the effort will install home solar arrays in disadvantaged neighborhoods, using $14.7 million raised through California’s cap-and-trade system for reining in greenhouse gas emissions.

The organization specializes in solar and energy-efficiency projects in working-class communities. Using the cap-and-trade money, Grid Alternatives plans to install arrays on more than 1,600 California homes by the end of 2016. It taps job-training programs to provide the installers and relies on donated equipment from such Bay Area solar companies as SunEdison, SunPower and Enphase.

Most homeowners are asked to make small contributions for the installation, such as agreeing to feed the crew installing the array, or agreeing to help with the installation themselves. The arrays will save most homeowners $400 to $1,000 per year on electricity, depending on where they live.

Read full article in the San Francisco Chronicle