Purchase or Pre-paid lease of 4-year old Solar System

[russ]

Then I would send Solar City a letter and say they have 30 days to remove

Better keep your day job!

[quicksilver8907]

I would have a lawyer draft the letter, but do you not think that would be sufficient russ?

[OvertheSun]

I would have a lawyer draft the letter, but do you not think that would be sufficient russ?

You should mention in your letter that you have contacted other solar vendors, obtained bids for the purchase a new systems and since they are unwilling to sell their system to you for the fair market valuation you placed upon it and offered to pay, you now require that they remove their panels from your roof so that you can begin installation of your new system, and they will be liable for damages for lost revenue to you if they don't, effective June 1.

[russ]

You should mention in your letter that you have contacted other solar vendors, obtained bids for the purchase a new systems and since they are unwilling to sell their system to you for the fair market valuation you placed upon it and offered to pay, you now require that they remove their panels from your roof so that you can begin installation of your new system, and they will be liable for damages for lost revenue to you if they don't, effective June 1.

A couple of dollars a month will make them move faster?

[J.P.M.]

A couple of dollars a month will make them move faster?

Probably not, but it probably won't hurt either - especially if things get weird down the road and it winds up in arbitration or litigation. What's the harm ?

[OvertheSun]

A couple of dollars a month will make them move faster?

Oh, i don't know - most companies don't like to be sued.
Damages: $145
Legal Fees: priceless

[frizzlefry]

Oh, i don't know - most companies don't like to be sued.
Damages: $145
Legal Fees: priceless

Yea. That'll get them to act.

/sarcasm

[SoCalsolar]

Couple of things...

First I wouldn't recommend turning the system on without getting approval from SCE. You open yourself up to all kinds of damages to equipment and or persons if you operate without their permission. You would still be sending power back to the grid and you would not being getting credit for it. This would mean your savings would likely be very low. If you were to get permission from SCE you would need to disconnect the monitoring. This is how SC or any lease company sees what you are producing, There is no army of meter reader that come by the house monthly. The monitoring is likely internet based. There is also cellular monitoring but four years ago it was fairly rare if used at all. I doubt SC has added it to your system since your bought the house. Lawyers don't scare these guys if you are looking to get a response out of them you ought to post the facts and only the facts of your situation on social media. I've worked in solar for a few years primarily in SCE territory. Social media is huge especially to a company like SC. This if done correctly it will get you a response and even a face to face with decision makers. It doesn't sound like you have really penetrated the lower level guys yet. They want that system on your roof working or not working for at least 3 more years to capture the depreciation. To unwind and alter or cancel this type of transaction will likely cost them more than what you offered removing the panels after 3 years is just another write off so cost is actually almost nothing. What is your zip and if you want to collaborate on this with me PM me I've some ideas for you.

[quicksilver8907]

I sent you a pm SoCalSolar. I am open to any other ideas you guys may have. I haven't heard back from solar city in over a week and I'm really not in a hurry because we haven't even gotten our first electric bill yet so there is nothing to compare it to anyways.

[JCP]

The $4K buyout offer seems like a crazy low ball offer to me. If the system is in good working order, I'd guess that FV would be pretty high. On a PPA proposal I got from Solar City a year ago, there was a buyout schedule with a min FMV at the end of each year. At the end of year 4, the buyout was equal to about 80-85% of the initial full prepay.

If the system is in good working order, I'd offer 60-70% of the value of an equivalent system new after tax incentives. It has plenty of life leftover, and it's already on the roof. Why go through the trouble of removing to install another one that'll be only more expensive? The electricity coming out of the wires is no different.

[quicksilver8907]

I know it was a crazy lowball offer. I am not ready to really purchase a full system for more than that, so I offered what I was willing to pay now.

[J.P.M.]

The $4K buyout offer seems like a crazy low ball offer to me. If the system is in good working order, I'd guess that FV would be pretty high. On a PPA proposal I got from Solar City a year ago, there was a buyout schedule with a min FMV at the end of each year. At the end of year 4, the buyout was equal to about 80-85% of the initial full prepay.

If the system is in good working order, I'd offer 60-70% of the value of an equivalent system new after tax incentives. It has plenty of life leftover, and it's already on the roof. Why go through the trouble of removing to install another one that'll be only more expensive? The electricity coming out of the wires is no different.

So low ball it and wait for them to counter. You can always come up in price easier than going down. Besides, I don't think the system owner has a lot of other customers lined up to take over the system in question.

[prhamilton]

Hey quicksilver we haven't heard from you in a long time. Curious how things went with Solar City. I remember you bought a foreclosed home with a leased solar system. Did Solar City ever give you an offer?

[quicksilver8907]

I offered them $4000 which I know was a super lowball offer, but worth a shot. They said no and basically said they could not sell it because the original terms of the system were only for a lease and no option to purchase. I have a feeling that if i gave them a reasonable offer they would take it but I am not in the position to do that currently. As it stands now we have gotten our first two electric bills for the home and they have been less than half of what Solar City wants for the lease, so I am obviously not going to take the lease at it stands now. They basically know that, but we agreed that we would try a few months without the solar and see what our bills are and then try a few months with the solar and compare after that, so they should be turning on the solar any day now, just waiting for them to contact me about scheduling a time to do that.

[J.P.M.]

I offered them $4000 which I know was a super lowball offer, but worth a shot. They said no and basically said they could not sell it because the original terms of the system were only for a lease and no option to purchase. I have a feeling that if i gave them a reasonable offer they would take it but I am not in the position to do that currently. As it stands now we have gotten our first two electric bills for the home and they have been less than half of what Solar City wants for the lease, so I am obviously not going to take the lease at it stands now. They basically know that, but we agreed that we would try a few months without the solar and see what our bills are and then try a few months with the solar and compare after that, so they should be turning on the solar any day now, just waiting for them to contact me about scheduling a time to do that.

This may be a case where your usage quantity and patterns for whatever reason(s) may be much lower/different than the previous owner's on which the existing system was sized. That is, if you were to get a quote for a new system today based on your usage, it sounds likely that such a system would be a fair amount smaller than what's there now.

FWIW, if it was me, I'd lower my offer to the existing system owner to $2K and tell them either take that offer or get their stuff off my roof to free up the space, while letting them know I'll be up on the roof w/ a camera watching like a hawk for damage if they choose removal. I'd send this info both certified and regular mail and CC my attorney on the bottom of the letter, whether I had one or not. Then I'd see what happens.