residential leasing

[atrevido]

We signed up for Sungevity's residential leasing. I don't have the specs on our system right in front of me but they are installing next week. I'm very excited. My understanding is that they are making their money on rebates, tax credits and the like. It is costing me net $1500, pre-payment on the lease. I don't have to pay another penny for 20 years. The terms (which I read very carefully and had a lawyer look over) are very clear, at the end of 20 years they will remove at their cost if I want it gone. I like that because 20 years from now technology will be vastly different.

I also get $500 for every referral I make. Which I won't make any until I see my first electric bill post installation.

So far the experience has been outstanding. We've had to do nothing. They are installing Canadian Solar ET185s panels.

[russ]

I also get $500 for every referral I make. Which I won't make any until I see my first electric bill post installation.


How kind of you! Screw your friends and neighbors just like you got it.

1500 USD for 20 years of power? Mind posting the lease here as I doubt that is true.

[atrevido]

Wow Russ, you're kind of a jerk, eh.

Just slap someone who is excited about cutting their electric bills and telling me I'm an idiot to boot and that I'm going to screw my neighbors.

My lease is basically the same as has been talked about in this thread, 20 years, no out of pocket, I don't have to pay anything at the end, I can tell them to remove it or pay them FMV, which I would just tell them to remove it as technology will have improved.

This is how SUngevity and Solar CIty are making their money -

9. Ownership of the System; Tax Credits; Rebates. This Agreement is a lease and not a sale agreement. We own the System and any data from the System for all purposes. We will claim the environmental incentives and tax benefits
available with respect to the System, including, without limitation, (a) depreciation deductions, investment tax credits and any cash grant in lieu of investment tax credits and (b) any renewable energy credits, utility rebates (including performance based incentives), and any other environmental attributes associated with the electricity output from the System (all the above collectively the "Tax Benefits"). You agree to cooperate with us so we may apply for or claim any such incentives and benefits. Cooperation may include your filing or consent to filing applications with the federal, state or local government or a local utility and assigning these benefits to us. You agree not to claim any tax benefit, grant or other incentive that the owner of a solar system migh

What do I care? I cannot afford $20,000 for for a purchased solar system which is about what all the quotes were I got. This way I get it and they get the tax benefits. Someone is going to get the tax benefits and rebates, if not me, then them. That money is set aside and is being spent at a rate that will soon deplete it well ahead of the 5 year schedule. So I'm glad I got on the band wagon now.

[mike95490]

....
What do I care? I cannot afford $20,000 for for a purchased solar system which is about what all the quotes were I got. This way I get it and they get the tax benefits. Someone is going to get the tax benefits and rebates, if not me, then them. That money is set aside and is being spent at a rate that will soon deplete it well ahead of the 5 year schedule. So I'm glad I got on the band wagon now.

What happens to your payment, when the grid is down, or the panels are not producing power, will you still owe your regular electric bill, or does the lease company take over the electric bill? And when their other incomes fail ( high sell backs, green credits) will they be asking you for the difference?

Taking a $20,000 investment, and having a company with overhead and several paychecks, just seems un-sustainable in the long term, even with all the tax credits and rebates the company can get.
I'm glad you had a lawyer look it over.

[russ]

My lease is basically the same as has been talked about in this thread, 20 years, no out of pocket, I don't have to pay anything at the end

As I read what you wrote, there is 1500 dollars out of pocket. What is the system size? How much power are you allowed to consume each month before you are billed?

I have yet to read of any leases where there is no electric bill for 20 years after the prepayment of 1500 USD - which would come out to 75 dollars/year for an electric bill - with no inflation - very difficult. I would say impossible but you already stated that I am a jerk.

Anytime there is 'free' money being passed out there is very good reason to question what is going on. 75 dollar per year electric bills are more or less free money

If a lease were posted for all to see rather than be a top secret document it would be far harder to criticize. All could see what is really happening. A lawyer reading the lease can tell you if it is legal - not if it is a good business deal.

Utilities have a set of rules to go by but these leasing companies seem to tailor it to each customer in a manner to 'get the sale'. None post a sample lease for all to see that I can find.

In general, many posts on other blogs are far more harsh concerning leases.

Best Regards,
Russ

[dwh]

I have yet to read of any leases where there is no electric bill for 20 years after the prepayment of 1500 USD

That's not what he actually said...

Read what you quoted:

I also get $500 for every referral I make. Which I won't make any until I see my first electric bill post installation.

So he did say that he'll still be getting an electric bill.

The way I read it is that he pays 1500 up front for the system, and hopes/expects to recoup that over the next 20 years via a reduced electric bill.

[newenergy]

Seems like Atrevido is saying it's $1500 and then not a penny for 20 years, so no lease payments?

If that's true it must be like a 1300 watt system? That's still a great deal though.

I don't think there will be any reason to replace the modules in 20 years just because there is new technology. These modules will be paid for, will be working (hopefully) and at that point whatever replaces them will cost more than zero. Also, hopefully your house will require less energy in 20 years thanks to technology, not more.

Sungevity and SolarCity (or anyone using SunRun) get the same tax credits and rebates that you'd get if you bought the system, so they aren't making money off of those any better than you'd be if you bought the system. They (or their investors) may have an advantage over you in being able to use accelerated depreciation though. The investors are comparing this to investments by the rate of return rather than just looking at how many years for payback and thinking anything over 5 years is a long time.

I think the fact that the lease is a good value despite having an extra middle man in there is just an indication of how good a long term investment solar is. But, of course, not everyone has the money to buy or maybe they would rather lease and put their money somewhere else.

(I don't see a Canadian Solar ET module?)

[Juram]

Seems like Atrevido is saying it's $1500 and then not a penny for 20 years, so no lease payments?

If that's true it must be like a 1300 watt system? That's still a great deal though.

I don't think there will be any reason to replace the modules in 20 years just because there is new technology. These modules will be paid for, will be working (hopefully) and at that point whatever replaces them will cost more than zero. Also, hopefully your house will require less energy in 20 years thanks to technology, not more.

Sungevity and SolarCity (or anyone using SunRun) get the same tax credits and rebates that you'd get if you bought the system, so they aren't making money off of those any better than you'd be if you bought the system. They (or their investors) may have an advantage over you in being able to use accelerated depreciation though. The investors are comparing this to investments by the rate of return rather than just looking at how many years for payback and thinking anything over 5 years is a long time.

I think the fact that the lease is a good value despite having an extra middle man in there is just an indication of how good a long term investment solar is. But, of course, not everyone has the money to buy or maybe they would rather lease and put their money somewhere else.

(I don't see a Canadian Solar ET module?)

I would recommend financing a system over leasing. You still have reduced payments but then you have actual tangent value that you can make money off of once you reach your ROI, or add value to your home if you sell it.


With a $1500 lease prepayment, the guy is getting at max a 1.5k system. At current pricing, buying that system, using the same sort of panels that they're using would cost you $7725 minus $3000 utility rebate -30% tax credit - state tax credit=Under $2200 to own the system 100% and get all future and eventual benefits such as feed-in-tariff's from your system.

If an area has a very weak utility rebate, then its worth looking at a lease but I have a nagging suspicion that these companies compensate for that by jacking up the pricing in those areas.


Basically, even a prepaid lease will be at most 20% cheaper than buying the system outright and the leasing company will make a lot more than that off of you by leasing your roofspace for 15-20 years and charging you for it.

[Juram]

This is how SUngevity and Solar CIty are making their money -

9. Ownership of the System; Tax Credits; Rebates. This Agreement is a lease and not a sale agreement. We own the System and any data from the System for all purposes. We will claim the environmental incentives and tax benefits
available with respect to the System, including, without limitation, (a) depreciation deductions, investment tax credits and any cash grant in lieu of investment tax credits and (b) any renewable energy credits, utility rebates (including performance based incentives), and any other environmental attributes associated with the electricity output from the System (all the above collectively the "Tax Benefits"). You agree to cooperate with us so we may apply for or claim any such incentives and benefits. Cooperation may include your filing or consent to filing applications with the federal, state or local government or a local utility and assigning these benefits to us. You agree not to claim any tax benefit, grant or other incentive that the owner of a solar system migh

What size in kilowatts is your system exactly?

[Energy Efficiencies]

Sorry, but I couldnt handle reading 11 pages of posts...I dont offer any type of lease program to clients because I figure if they have good enough credit to qualify for a lease, then they should buy the system outright with a second mortgage, remodel loan, etc. The payback here is around 7 years with the local rebates from the utilities and feds, and less than 4 for business because of MACRS..not including rate increases..so why would you even think of leasing...other than the no out of pocket some leasing companies offer...get real. This poster is going to pay out of pocket probably significantly close to buying the system. if you are paying for example 15% less on your bill for EVER, you can just as easily pay a loan off monthly and own the equipment in less time than you can buy out on the typical lease... Leasing companies are there to make money. PERIOD.

One other thing....when they come take the solar property off your roof, do they re-shinge? If not, what covers the roof penetrations that were made to install the system?