Cleantech has been called the greatest environmental opportunity of the 21st century—a potential counter-reality to the inconvenient truth of pollution, destruction and global climate change. In a previous post, I touted the ecological benefits of renting. Now I want to talk about the technology sitting at the center of the cleantech universe—solar power. The opportunity to create energy out of a renewable resource as prevalent as sunlight is very promising. It’s also very expensive.
The average cost to manufacture and install a residential solar system is $40,000. Sure, homeowners recoup this investment and more with reduced energy bills, effective immediately. But it’s still a ton of cash to put down up-front.
The recession didn’t help a widespread adoption of solar technology. It’s estimated more than $12B in revenues were lost in the solar industry during 2009 alone. What a shame. This green, cost-cutting technology was falling victim to frozen credit, fewer subsidies and massive layoffs. Just like the rest of the economy.
So, what’s a solar company to do? All this expensive product with no way to sell it. A few innovative companies realized maybe that was at the heart of the problem—selling. They thought, perhaps there are other (less financially prohibitive) ways to distribute solar technology. Instead of a one-time transaction of $40,000, some solar companies began leasing their systems on long-term contracts.
One of these solar rental pioneers is San Francisco-based
SunRun. Under their model, households pay an installation fee (no more than $1K) and agree to a fixed monthly utility and maintenance bill for the next 20 years, during which time they save thousands of dollars. Leases are easily transferred so relocation isn’t a problem. Most new homeowners are happy to lock in electricity costs for the near-term future—
a financial no-brainer.
Compared with the rest of the industry which tanked in 2009, SunRun’s year-over-year growth was 400% and bookings are expected to triple in 2010. And SunRun isn’t the only solar company to discover the rental opportunity—
Sungevity,
Citizenre REnU,
SolarCity and others are discovering the consumer-friendly benefits of renting.
Solar energy. Just another way to reduce, reuse, rent.
