Environmental Engineering Reference
In-Depth Information
engineering allows you to pay for your solar panels over time instead of up front, and
this is probably the most important innovation in the solar industry in the past decade.
Here's what it means for you: Forget the notion that you have to pay $30,000 to
$50,000 to go solar. Now you pay nothing—nada, zero, zilch. By removing the up-front
cost, we've made it easier than ever for customers to go solar; and because customers
make no investment, they keep all the money that they save against their electricity cost.
For example, let's take a customer of traditional utilities who comes to Sungevity. She
currently pays $180 per month for her home's electricity. But once she takes advantage
of our services, she pays $50 to her utility company for monthly services (because she'll
need some service from the grid, at night for example) and approximately $80 to Sun-
gevity to lease our solar equipment. She pockets $50.
Thisisoneperson'sexperience;80percentofourcustomershavesavedontheirelec-
tricity bills from day one of going solar. We now have thousands of customers in eight
states. Our competitors combined have tens of thousands of customers; indeed the solar-
leasing market is booming. Most solar systems installed on residential buildings in the
United States are now leased or have another third-party finance arrangement known as
a
power purchase agreement,
which charges them for the kilowatt-hours they use from
thesolarsystem ratherthanaflatmonthlyfee.Thekeyisthatthisisthefuture,andmost
homes going solar in the coming years will benefit from some affordable, pay-as-you-go
financial construct.
At the level of the overall electricity market, the IEA, in its 2011 study, adopted the
position that the solar-energy industry has long held—that, as with any other energy re-
source, planning ahead and financing these assets makes all the difference. The example
of the leasing arrangement just puts solar electricity on the same footing as coal-fired
power coming out of the plug in the wall from the grid. The coal power plant at the oth-
er end of the wire was not paid for up front by you or by the company that built it. The
utility company used debt and other finance capital to create that energy capacity to sell
you the service of power. Now you can buy the service of solar electricity for less than
the cost of dirty electricity that you get from the grid.
In acknowledging the importance of new financing mechanisms being applied to
solar-power supply, the IEA observes the fundamental competitive advantage of solar,
whichishavingfreefueloverfossilfuel.Italsosaysthatothersolutionsfallshort,while
solar technologies offering “indigenous, inexhaustible resources” are actually more se-
cure, less likely to experience price volatility once the technologies are mature, environ-
mentally sustainable, and “the cheapest known antidote to catastrophic climate change,
even if they are or appear to be higher-cost options in other ways.”
So we're witnessing a sea change in how the establishment industry watchers are re-
portingsolar'sprospects,andeventhose“otherways”thattheIEAflagsaspossiblycost-
