Solar system owned by outside company?

[Batvette]

Forgive me for a general lack of details but I will try to describe this right.
A friend of mine in the city of La Mesa, CA, (a suburb just east of the city of San Diego) told me the other day "we're getting solar tomorrow" and described a scheme where a solar company is coming out and installing panels on the roof, and some form of battery storage, whereas that company owns all the equipment. Theyre going to pay the company$200 a month and use all the power they want, and anything they dont use the company sells back to the grid and the company keeps the proceeds from that.

Does that sound right? Is this a typical deal?

I wanted to hear from anyone with experience with similar schemes before I told him what I thought about it.

 

[schmism]

That is a real contract thing that people can sign up for. I dont know how accurate the $200 is. It sounds about right. Typically the plans are based around what your current avg electric utility bill is. Typically this is for like 7-10 years of fixed rate after which time the hardware becomes the property owners and they can continue to use it for free.

Have them review the part of the contract that talks about failure to pay. Its my understanding they will come repo the solar off the house and leave the home owner with the headache of fixing any damage associated with that process.

Also have them understand what the byout rate/cost is. It can negitivly impact a home sale if the new owners dont want to continue the deal and dont like the cost to buy it out at that time.

 

[DIYrich]

Forgive me for a general lack of details but I will try to describe this right.
A friend of mine in the city of La Mesa, CA, (a suburb just east of the city of San Diego) told me the other day "we're getting solar tomorrow" and described a scheme where a solar company is coming out and installing panels on the roof, and some form of battery storage, whereas that company owns all the equipment. Theyre going to pay the company$200 a month and use all the power they want, and anything they dont use the company sells back to the grid and the company keeps the proceeds from that.

Does that sound right? Is this a typical deal?

I wanted to hear from anyone with experience with similar schemes before I told him what I thought about it.

Seems like a standard ripoff Power Purchase agreement. How long is he paying $200/mo? Does he own it at the end?

Is it $200/mo for all the power they want, or all the power the Panels produce? What if he has to net import from the Grid? Does he pay that power bill, or does the Solar Company?

What if he purchased it using a loan? That is usually the best option if he can benefit from the Federal Tax Credit.
Lease to own/buy out at end is probably the next best option.
I wouldn't do a power purchase agreement.

 

[schmism]

Oh and dont take the word of the salesperson. Read the contract! "but they told me that ...." nope its on you to read and understand the contract you sign.

 

[Batvette]

Ill find out the details when I see him in a few days. What you said is right, I always thought people purchased these setups and their house is worth 7 figures (san diego home prices) and paid for but they do have a reverse mortgage.
They arent particularly dumb so Im assuming they read the fine print.

 

[OzSolar]

Ill find out the details when I see him in a few days. What you said is right, I always thought people purchased these setups and their house is worth 7 figures (san diego home prices) and paid for but they do have a reverse mortgage.
They arent particularly dumb so Im assuming they read the fine print.

I'd be curious to hear an update. I've have personally observed a lot of pretty smart people's IQ drop at least 20 points when it comes to making wise choices about solar when they've got a pit bull of a salesperson whos' made it clear that they aren't getting up from your kitchen table until you sign the contract or force them out of your house at gun point. LOL

 

[ksmithaz1]

I'd be curious to hear an update. I've have personally observed a lot of pretty smart people's IQ drop at least 20 points when it comes to making wise choices about solar when they've got a pit bull of a salesperson whos' made it clear that they aren't getting up from your kitchen table until you sign the contract or force them out of your house at gun point. LOL

I chatted with one of these outfits. I can assure you, that you are taking 100% of the risk, for 50% of the benefit at best. Once I started doing the math, I figured that for the same money I could simply bypass all the grid madness, and run my house 100% off solar. I was off a bit, I will need about 50% more, and some of the stuff was more expensive than planned, but even as it stands, I'm WAY better off. I have drastially more solar output, I have drastically more AC output, I have sufficient battery to run my house 24x7 and can usually even charge my cars, and I own all of it, though I did finance a small chunk of it to get some extra battery now when it is the most useful, instead of in February/March.

Most people just look at a "payment" that supposedly "saves them money". If you pay me $200/mo I'll save you $300/mo on your electric bill. It's a Win-Win! except when it isn't. My ROI remains to be seen, But I've been paying around $3000/yr for electricity, and I'm expecting that to drop to around $500 or less as i sit now, so maybe a 15 year payback, when I have everything in place, assuming electric rates remain stable. I pushed a bit, because I don't thing electric rates are going to stay stable. The insane push to electrify everything tomorrow in a willy-nilly approach is bound to create disruption.

For now I just need another 4K-ish of panels, and get what I have mounted more sanely. I'll pay cash for some more battery once I save up for it.

So its possible even some of these crazy deals people are taking will actually not cause too much harm.

 

[Batronca]

Do not do it, it is lease.
lease=lose

 

[45North]

I think I'd want my lawyer to go over it before I signed it.
Mebbe it's ok. If your roof in San Diego has lots of sun and power is expensive it could work out ok. The devil is in the details. Might be better to invest their money than yours.

 

[Batronca]

At daytime, solar produce more than you use ,a excess power SDGE will changer 3 cents/kWh for a storage, and buy back about 6 cent /kwh.At nighttime you will pay at regular price. You will be lose right here.
you pay $200 per mouth by what ever a solar system produce, i guess 6k to 7 kw system.
solar produce 30kwh per day’s.
you use 15kWh at daytime, send back to PEGE 15kwh for storage.
nightime you will use 15kwh x 34 cent/kWh +74 cents/kWh ( from 4-9;or 5-8)(TOU)
$200 a month + PEGE changers.
BTW. You can’t sell a house with 20 or 25 years lease solar system,unless you have to buy out.(they will lien to the house)