SolarCity 20-year lease too good to be true?

[nate]

I found the fine print about the feed in tariff program.

http://www.portlandgeneral.com/renewables_efficiency/generate_power/solar_payment/solar_payment_qa.aspx#one

From that page,
>>"Small-scale installations up to 10 kilowatts (kW) will receive 46.8 cents per kWh."

Sounds pretty good, considering how much less a kWh currently is. Also, program rates can change but they won't change for the 15 year term that you sign up for to do this program. This protects from if they decide the program is too lucrative and decide to change it, but it doesn't help you if energy cost increases exceed your initial expectation that you based your decision to take join this program (which is a 15 year agreement). Considering this, the lower that utility rates remain the same over the next 15 years the more this program makes sense (due to the cost of the rate you sell your power having a greater difference between what it costs you to consumer it). Likewise, if rates went up significantly the more this is not as attractive as compared to the normal net metering arrangement. Correct?


something else I noticed...
>>"PGE is requiring customers installing systems under this program to have $1 million in liability insurance. This is beyond standard homeowners insurance"

I'm not living / insuring a million dollar home and wonder what the difference in insurance will run over the course of time.

[russ]

Check out SunRun - they are in OR as well. http://www.sunrunhome.com/cost-of-solar

As I remember form years back, in Portland it rains almost constantly from mid December until mid June - then not much at all until December.

The estimated production figures show that too.

Russ

[nate]

Thanks for the tip Russ. I talked to them and will be seeing what they can do too.

For comparing Oregon's Feed in Tariff option vs. doing net metering, what do people think the range that can be expected for ave electrical rate increases per year?

[nate]

Rich,

The website in you sig says on the residential PV page, "Be aware that solar electric (PV) has seen a 30% drop in costs over the last year alone."

Do you know if this is a 30% drop in the system cost itself, or a net cost due to a change in various tax laws? Since the next sentence starts with "Combined with the current incentives..." it seems like it isn't talking about a drop in net cost due to incentive changes. Instead, it seems like it is talking about a drop in the cost of the systems themselves. Is this right? What accounts for the big drop in price from a year ago?

[russ]

Hi Nate,

The OR gov site has some information available. www.oregon.gov/ENERGY/RENEW/Solar/PV.shtml

A NREL info document http://www.statesadvancingsolar.org/...oltaic-systems

Russ

[Naptown]

Rich,

The website in you sig says on the residential PV page, "Be aware that solar electric (PV) has seen a 30% drop in costs over the last year alone."

Do you know if this is a 30% drop in the system cost itself, or a net cost due to a change in various tax laws? Since the next sentence starts with "Combined with the current incentives..." it seems like it isn't talking about a drop in net cost due to incentive changes. Instead, it seems like it is talking about a drop in the cost of the systems themselves. Is this right? What accounts for the big drop in price from a year ago?

The cost of equipment has come down significantly over the past 2 years. There was a tremendous amount of manufacturing capacity built then and with the world economy going south softened the market. This has led to price drops to stay in business for many manufacturers. Incentives in Maryland have actually dropped by 75% over the past two years. meaning less incentives from the state.

[KRenn]

I've been looking at various solar lease options and the most favorable I've seen come from Sungevity and Centrosolar.

The SolarCity lease typically has a much higher escalator, its going down somewhat but from the quotes I've seen, I get the most bang for my buck from Sungevity because they include everything(warranty, insurance, low escalator) and Centrosolar because although their lease is a bit higher, they do use better quality panels than any other leasing company and as far as I understand it, don't interfere with net metering credits in anyway. Sungevity gets a bonus for ease of use due to their online quoting system.

[nate]

I've been looking at various solar lease options and the most favorable I've seen come from Sungevity and Centrosolar.

The SolarCity lease typically has a much higher escalator, its going down somewhat but from the quotes I've seen, I get the most bang for my buck from Sungevity because they include everything(warranty, insurance, low escalator) and Centrosolar because although their lease is a bit higher, they do use better quality panels than any other leasing company and as far as I understand it, don't interfere with net metering credits in anyway. Sungevity gets a bonus for ease of use due to their online quoting system.

What do you mean by escalator?

[russ]

If you take the zero down or minimum down leases there is a monthly payment that is often subject to a fixed escalation over the years.

Russ

[nate]

Oh, I see. Thanks Russ.

My 1st quote I had from them had options to pay monthly, but it stayed the same for the length of the lease. These weren't of interest for me anyway because the $ per DC watt installed did not compare well to the pre paid lease. When I had them change the size of the system, I had them just quote the pre paid lease.

[JoelInCali]

Not looking back

Just like Ken, I did a prepaid, 20-year lease with SolarCity and I am not looking back. I thought the deal was very good. Yes, SolarCity gets all the initial government credits, but my break even point is 8 years, then everything after that is gravy. Here is the system I got...

• 4.7KW DC
• 20-year lease
• One payment out of pocket of $7900. No further payments.
• 1st year guaranteed production = 6400 kWh
• 10th year guaranteed production = 5800 kWh
• 20th year guaranteed production = 53000 kWh
• If in any year the guaranteed production is not met, I get a check equal to $0.130 per kWh x difference, with an annual per kWh increase of 4% every year.
• Break even point on my $7900 is estimated to be 8 years.
• Estimated average price per kWh over lease is $0.063
• Estimated utility company price increase is 6.0% per year
• 20-year monitoring, warranty and service.
• At the end of the lease, we can renew, upgrade or they will remove the system for free --- here is the kicker, it is highly unlikely that in 20 years it will be monetarily worth it to SolarCity to come remove 20 year old panels. So there is a good chance we just get to keep the system. We would just lose the monitoring, warranty and service.

My system is newly up and running and it is pretty cool to see the thing producing.

I really couldn't see a downside to this lease (besides not owning it outright from the get go). Maybe someone else will something that I didn't.

[Naptown]

Wow such a deal
Break even at 8 years is longer than in Maryland which averages 5. And CA utility rates are higher than Maryland
Caveat Emptor

[JoelInCali]

Why the sarcasm?

Wow such a deal
Break even at 8 years is longer than in Maryland which averages 5. And CA utility rates are higher than Maryland
Caveat Emptor

Sounds like you don't think I got a good deal. Not sure why you have to be snarky about it. Please tell us why the deal I (and maybe Ken) got is so horrible. Remember the following: cheaper isn't always better, generally no one ever gets the *best* possible deal, the 8 year break even is probably worst case, you don't know my utility rates (municipal electric rates are cheaper than something like PG&E), etc.

So you think $7900 for a 4.7KW DC system that I will have for 20 years (and very possibly as long as I want afterwards) with a break even of at the most 8 years is bad. Why?

[Naptown]

Not being snarky just being truthful
This thread is 12 pages long
Read the entire thing All the information you could ever want is there.
I personally compete against SolarCity etc
Although I cannot offer the low upfront costs they do the ROI on what we do beats them every time in the long or short haul.
I have read many lease agreements and the consumer comes out short on every one of them vs an outright purchase
Even being almost three times the up front cost the consumer will make out better.

[Naptown]

I don't know if anyone here follows a twitter account called "S*#t My dad says or watches the TV show but here is something I thought appropriate for this thread.
As posted ( edited to change expletives) on the twitter account


"You didn't get a good deal, you were just f#%*ed gently. Trust me, (Insert leasing company name) will not be the one with the sore a#*hole tomorrow."