Internet and solar giants Google and SunPower announced a useful break for power customers (and a small climate change deterrent) yesterday by entering a $250 million partnership in clean US home energy for the future. A new fund ($100 million from Google and $150 million from SunPower) will help finance residential rooftop solar leases for thousands of households across the US.
A Google spokesperson explains:
Essentially, this is how it works: Using the fund, we buy the solar panel systems. Then we lease them to homeowners at a cost that’s typically lower than their normal electricity bill. So by participating in this program, you don’t just help the environment—you can also save money.
“This kind of arrangement can reduce immediate out-of-pocket expense to homeowners to zero,” says 24/7 Wall Street. The monthly installment payments can replace all or much of the homeowners’ residential electricity bills.
Efficacy of such financing arrangements? In February, using EnergySage’s new Instant Solar Estimate tool, Solar Love compared the financial benefits of going solar through a cash purchase, a $0-down solar loan, and a $0-down lease or PPA, where available. Leasing came up short in the tool’s gross estimate, so the writer (Planetsave & CleanTechnica director Zachary Shahan) ran 10 tests for real addresses in various states where solar leasing exists, from Albany to Honolulu. Cash, of course, produces the best return, for those who have it and choose to spend it on solar. However, Zach found that solar leasing and the $0-down solar loan option actually tied (5 to 5) for the number of times that they were the better option.
SunPower’s Solar Technology Leadership
SunPower began developing world record-breaking technology with the birth of solar power in the 1970s. It now serves the customer spectrum: residential power, commercial power, and energy systems for electric generation and utilities. On its website, the company further explains the benefits of residential solar leasing opportunities:
• You know what you are putting on your roof—The Planet’s Most Powerful Solar®, backed by a financially sound, stable company that is the number one choice of U.S. homeowners and businesses;
• System maintenance, insurance, and performance guaranteed by SunPower, or your money back; and
• Professional installation with the highest standard of quality and customer service from SunPower’s best-in-class network of installers
Google’s Clean Energy Investments Keep Growing
This is Google’s third large investment in residential solar. In June 2011, as we reported, Google laid on $280 million with SolarCity to create a similar fund. At the time, it was Google’s largest investment in clean energy, SolarCity’s largest project financing fund, and the largest residential solar fund created in the US. (SolarCity has now created 15 solar funds with seven different partners to finance more than $1.25 billion in solar projects.) Later that year, Google announced a $75 million investment with Clean Power Finance to help up to 3,000 homeowners go solar. Overall, yesterday’s deal pushes Google’s worldwide renewable energy projects around the world up over a billion dollars.
While $250 million will only make a relatively small dent in the residential power industry, it is at least measurable. Economically, this type of initiative in the grassroots seems to make more sense in some cases and cost less than constructing utility-scale plants, as well as putting more control into the hands of individual consumers. Florida and Arizona homeowners have shown particular interest today. Needless to say, SunPower’s stock has gained considerably.
For Google, the investment fund comes on the heels of the company’s announcement yesterday of its largest renewable energy purchase yet: an agreement with Iowa utilities to supply the impressive Google data centers in Council Bluffs with up to 407 megawatts of wind energy.