Solar Comes of Age: SolarCity to Double PV Systems on Americans Homes by 2016

A leading American solar company is set to begin the largest residential rooftop project ever undertaken, effectively doubling the number of solar systems currently on homes around the U.S.

Armed with funds from two major investment banks and a loan guarantee from the Department of Energy that will cover close to a third of the $1 billion project, SolarCity plans to install 160,000 solar photovoltaic systems on houses and other buildings on military bases around the country in the next five years.

As a “solar services” provider, SolarCity owns, operates and maintains the systems, and sells the electricity to the end-user. By working with investment banks to pool together often-complicated state and federal incentives, the company streamlines the process and simply offers the customer solar electricity — often at prices lower than current electric rates.

Given the relentless attack on green jobs and the DOE’s loan guarantee program in recent weeks, this story is particularly relevant.

SolarCity says it will try to employ American veterans and family members for the 750 people needed to complete the project, showing that green jobs do indeed exist. The company has seen extraordinary growth in recent years. After starting in 2006 with just two people, SolarCity has added over 600 employees since 2006. And this latest project will again double the staff.

The $344 million loan guarantee will leverage $1 billion from private investors Bank of America Merrill Lynch and USRG Renewable Finance. This comes after Google invested $280 million in a fund for SolarCity installations this past June.

With the bankruptcy of the solar company Solyndra last week, the Department of Energy loan guarantee program has been under major attack. What critics don’t mention is that the $535 million set aside for Solyndra is only two percent of all loan commitments to clean energy companies, and is dwarfed by the tens of billions of dollars leveraged by the program.

The DOE loan guarantee program is designed to fund “first-of-a kind” projects. As an ambitious 160,000-system undertaking, this project is exactly that. But it’s also a very safe bet. SolarCity is a company with a proven business model and a history of strong, sustainable growth.

You can bet that the critics who claim green jobs “don’t exist” or solar power “doesn’t work” will be ignoring this piece of news.

14 Responses to Solar Comes of Age: SolarCity to Double PV Systems on Americans Homes by 2016

  1. Dr.A.Jagadeesh says:

    Yes. US is going all out to promote Rooftop Solar.

    Dr.A.Jagadeesh Nellore(AP),India

  2. Mike Roddy says:

    This is a good program, and we need a lot more home rooftop installations.

    I work for a major engineering company in California that will install solar on large commercial buildings for no cash and no debt. The client keeps the utility savings, too. This program is enabled by a complex and innovative financial instrument.

    Interested principals can email me at

    Commercial installations allow economies of scale, and typically have adequate rooftop or parking lot space for the panels. The economics are excellent, provided that all of the pieces are in place- adequate insolation, strong financials, etc.

  3. Congratulations to the U.S.A. for their forward thinking regulatory actions on the green energy front. And to SolarCity for pulling together a strong business concept and actually delivering.

    Without the initial infusion of government incentives, you would never have entreprenuers like SolarCity getting into the game. It would take much longer to get economies of scale working for solar PV – which we all know is a better alternative to non-renewables. Folks, we don’t have a great deal of time to reduce GHG’s. The more business-savy people getting into solar or other renewables, the better it is for everyone – short and long term.

  4. Pangolin says:

    Residential solar panels should be financed by “at the meter” pricing. I feel it’s important though to ensure that the ownership of those solar panels is transferred to property owners when their costs, including financing, are paid.

    These leasing arrangements have the queasy stink of telephone contracts where the phone you pay for is useless junk should you decide to switch providers.

  5. AlanInAz says:

    I am not a fan of long term leases for solar panel units. I think most homeowners would be better off if they buy the system. I have installed grid tied panels on my roof and I own the system (paid in cash but could have been financed). I saved quite a bit by aggressively negotiating price with several installers. Payback is about 5 years and there is virtually no maintenance. The install has added value to my home with no impact on property taxes. Were I to sell my house today I would get more than my net investment back in added resale value. I am a big fan of rooftop solar, especially in a place like Tucson where I live. Regarding the decision to lease, I suspect that Solar City leases may be more attractive in Phoenix than Tucson. Power company subsidies are lower in Phoenix than Tucson and more homeowner capital is required.

  6. David B. Benson says:

    I’m certainly in favor of this, seeing (so far) no hidden environmental or other reasons not to move forward.

  7. Greg Wellman says:

    Good job Alan! I’m glad you’re enjoying your solar power. Is it grid-tied (does your excess flow into the grid when you’ve got excess)?

    Five year payback is good – everyone in AZ and NM should be all over this. Up here in Seattle, I’ll be waiting a while longer, but in 5 years or so it should be worth it.

  8. Joan Savage says:

    Installing on the roofs of military base property vastly simplifies the issues that come with ownership turnover and leased equipment. From the post it seems that the US military does not even lease the equipment, so that further simplifies the relationship. Financially it’s more like allowing a vendor to operate a food-wagon on base. The vendor deals with all the equipment on his/her own and the customer is only buying electricity.
    What seems plus to me is that this arrangement allows incremental increases in electricity supply on remote sites, without having to think about putting a large transmission line to a distant location.

  9. AlanInAz says:

    Yes, the system is grid tied. In the winter I donate power and in the summer I receive power from the utility. Overall, my full annual electric demand is covered. This system is great as a supplement and partial replacement for power from the coal burning utility. It cannot completely replace the utility unless I get batteries and go off grid. If I did go off grid I would need a bigger system for the summer demand.

  10. AlanInAz says:

    It is not clear to me that the systems will be off grid. Solar City generally leases grid tied systems like the one I own. The advantage to homeowners of leasing is low or no initial capital but at the expense of long term savings and property transfer issues. Maintenance for grid tied systems is nil. The advantage to the DOE seems to be working with one vendor for all the installs.

  11. Joan Savage says:

    I didn’t think it was off-grid either, as there was no mention of investment in household battery backup for overnight. A local grid (military base) could buy the electricity, as well as the individual occupants of the military housing. The Plus that I was praising is reduction of costs of adding long-distance power transmission, such as interstate high voltage lines.

  12. Solar power is indeed the future. And I believe there are more things about nature, that humanity still hasn’t discovered. ;)

  13. Bob Siegel says:

    What I don’t see here is where these panels will be manufactured. Are they made in the US or imported from China?