Solar electric lease firm Sungevity expands to Los Angeles DWP service area
Rooftop solar electric panels can be expensive, even after factoring in the 30% federal tax credit and utility rebates. For some prospective photovoltaic customers, leasing, rather than buying, may be a better option because it allows them to pay for solar power at a monthly rate that is similar to -- and often less than -- their usual electricity bill rather than pay for the entire system -- and two decades' worth of power -- upfront.
Sungevity, based in Oakland, is one of a growing number of residential solar providers that leases, rather than sells, rooftop solar -- with a key difference. The no-money-down system streamlines the design process by leveraging the Internet. Instead of coordinating site visits and in-person meetings with prospective installers, Sungevity employs Internet-derived aerial photographs of a home to calculate the pitch of the roof and its orientation to the sun to design a solar system virtually, rather than manually.
Using a customer's utility bills to determine a home's electricity use and the utility rebate it would receive by going solar, Sungevity then e-mails an installation proposal, or iQuote, within 24 hours of the customer's request.
"It's kind of akin to iTunes or Netflix with an electronic signature for the lease contract," said Sungevity president and founder Danny Kennedy, who has sold about 230 solar leases since March, mostly to Southern California Edison and San Diego Gas & Electric customers.
Today, Sungevity is expanding its lease program to customers in the L.A. Department of Water and Power service area. Financed by U.S. Bancorp, the leases last 20 years and would need to be taken over by the next homeowner if the house is sold before the lease has expired.
While Sungevity can sell, quote and design systems online, "the final mile of installation is done out there in the community," said Kennedy, who has partnered with about a dozen contractors and electricians who are experienced solar installers.
Kennedy says 60% of California solar customers will immediately pay less for electricity with leased rooftop solar than they would without it and that by mid-lease all customers are paying less. Sungevity automatically increases the cost of its leases 2.5% per year, but Kennedy says most utilities are raising their rates 5% annually.
-- Susan Carpenter
Photo: Al Seib / Los Angeles Times