Monday, September 8, 2008

Is SolarCity's SolarLease Right for You?

A friend of mine emailed me a few days ago about SolarCity's SolarLease program. Instead of purchasing solar panels upfront, SolarCity offers a leasing option would only charge an initial fee of $1,000 and rest are paid off in potential electric bill savings.

In a local news broadcast, SolarCity claimed it would save customers about 20% of their current monthly electric bill. Assuming customers could pay the initial $1,000 downpayment and their monthly bill must be $150 or higher to see the savings.

According to SolarLease Calculator from SolarCity's website, the 20% saving claim is correct if the customers are using APS (Arizona Public Service Company) as their utility provider seen in Figure 1.

Figure 1 - APS customer's potential saving if switched to SolarCity

Figure 2 - SRP customer's potential saving if switched to SolarCity

However it is not true for SRP (Salt River Project) customers.

In figure 2, it shows SRP customers would need to spend a monthly average of $800 on their electric bill before SolarCity's program would save them any money.

Matter of fact even at that rate, SRP customers will never recoup their initial investment even after 15 years!

There are other limitations about SolarCity's program, such as customer's credit score must be higher than 720, and it only serves small territories along Oregon, California & Arizona.

SolarCity's SolarLease is a nice concept, however it is not for everyone, definitely not for SRP customers.

For now, let us all hope it would not turn into like the ZAP car hype.

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