Alternative Energy Investor Discussions

[Gtoffo]

It certainly could. The President says he will speak about executive actions to implement "a national plan to reduce carbon pollution, prepare our country for the impacts of climate change, and lead global efforts to fight it."

I first purchased SCTY in March. I then sold on May 30 in anticipation of the June 11 lock-up expiration. I bought back in today.

I bought some at around 34$ after the expiry...I've been selling and re-buying little lots since. I got some more today taking advantage of the low prices and betting on some good news tomorrow. We'll see...

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well, I cant see there can be bad News for Solarcity or Tesla. But I can really see him come With good News.

Well there is some risk involved: there could be something about subsidies/tax incentives being reduced/substituted by something else... and we know how sensitive the market is to those kind of things... it would sink both stocks pretty bad.

Just something to keep in mind before hitting the buy button a little too much....

 

[Norse]

Well, if they substitute With tax like in Europe, thats just as good. If theres carbon tax and more tax for gasoline, both Companies will benefit, even thou they dont get the Money directly.

Obama cannot be reelected so he can do some unpopular changes, which are needed. I really think he wants to be remembered as a guy that helped the climate for the better, and the US has not been up to date With the
rest of the western world.

 

[ggies07]

I have a question for someone that went with this company for solar panels. Which is better/cheaper, the SolarLease or PPA program?

 

[sleepyhead]

I have a question for someone that went with this company for solar panels. Which is better/cheaper, the SolarLease or PPA program?

I would go with Sunpower if I were you. Why would you want to put cheap Chinese made panels on your roof. They have higher degradation, perform worse in various climate conditions, etc. Who knows how good they will be in 10 years time. With Sunpower you will get the best, highest quality, most efficient panels in the world. And financially speaking you will be better off too compared to going with Solarcity. Not to mention that you will get a much bigger system (in Watts) per sq. ft of roof space.

Lease is a liability if you want to sell your house. But if you go with Solarcity, then lease is the only option. No way would I ever purchase those cheap Chinese solar panels. If you go with Sunpower then definitely buy; you will get the tax credit and a 25 year warranty. The panels will probably last longer than that too.

 

[ggies07]

I would go with Sunpower if I were you. Why would you want to put cheap Chinese made panels on your roof. They have higher degradation, perform worse in various climate conditions, etc. Who knows how good they will be in 10 years time. With Sunpower you will get the best, highest quality, most efficient panels in the world. And financially speaking you will be better off too compared to going with Solarcity. Not to mention that you will get a much bigger system (in Watts) per sq. ft of roof space.

Lease is a liability if you want to sell your house. But if you go with Solarcity, then lease is the only option. No way would I ever purchase those cheap Chinese solar panels. If you go with Sunpower then definitely buy; you will get the tax credit and a 25 year warranty. The panels will probably last longer than that too.

Well, thank you for the info, but I dont know the difference in the quality. Plus, I dont have the money to buy them when installed, thats why I was going with Solarcity because of their lease plan. Im also a shareholder of the company. Does Sunpower lease as well?

 

[sleepyhead]

Well, thank you for the info, but I dont know the difference in the quality. Plus, I dont have the money to buy them when installed, thats why I was going with Solarcity because of their lease plan. Im also a shareholder of the company. Does Sunpower lease as well?

Sunpower does lease as well. You have to be careful when leasing, because the actual math is a lot more complicated then what they show you on paper. E.g. Solarcity may offer lease increases of 2.9% per year, while Sunpower only does 1%.

Solarcity guarantees less than 0.5% degradation per year, while Sunpower does less than 0.25%. These sound like small numbers, but if you consider that Sunpower panels will have a significantly lower initial degradation vs. up to 5% of some competitors, and then tested to less than 0.13% actual degradation per year this will add up over 20 years. If Solarcity panels (which are made by Chinese companies Yingli and Trina Solar) have more than 0.5% degradation, they will make up the minimum to reach your guaranteed production number. But if Sunpower actually has 0.13%, then your panels will be producing significantly more than your minimum guaranteed production number. Once again this stuff adds up over 20 years. Both companies may guarantee you say 12kWh per year, but chances are that Sunpower will exceed that number by a higher amount than Solarcity.

Say you are promised 18,000 KWh per year from your 10 KW system. If you apply 0.5% degradation that will get you 343,400 KWh over 20 years. If you apply a 0.25% degradation you will get 351,600 KWh over 20 years, which is 8,200 KWh more from Sunpower than you would get from Solarcity. This is an additional $1,000 - $2,000 saved over 20 years. If actual degragation of Sunpower panels is 0.13% (as tested) then you will get an additional 12,000 KWh and potentially save up to $3,000. Remember electricity rates will only go up in the next 20 years. My understanding is that Sunpower is very conservative in their estimates, so that 18,000 kWh in year one may actually be 20,000 kWh, while a Solarcity system might only give you 19,000 kWh in year one.

Say Solarcity offers you $1500 per year lease with 2.9% annual increases. Sunpower only offers 1% annual increases, which means that you can start out paying $1800 per year and still be better off over 20 years. Factor in lower degradation and you can start at $2,000 per year lease and still be better off over 20 years vs. a $1500 per year lease on a comparable system from Solarcity.

My point is that the lease documents are tricky and they can fool you easily. I would go with Sunpower because they are significantly better (best in the world) panels, and will also perform better in extreme temperatures or if the sun's angle isn't the best, etc. They are innovators, and you will most likely be able to upgrade to even better panels 10 years down the road while extending the lease contract. It is a US company (even though panels are made abroad), and not Chinese made commodity panels that may or may not hold up for 20 years; this is not yet tested in the real world.

I own both Sunpower and Solarcity shares. I think that both companies will do really well in the future. But if I had to go with panels on my roof, I will definitely go Sunpower without a doubt. I am actually going to install Sunpower panels within the next 12 months on my own roof (already signed up on the list, but have to replace roof first).

 

[serkol]

I own both Sunpower and Solarcity shares. I think that both companies will do really well in the future. But if I had to go with panels on my roof, I will definitely go Sunpower without a doubt. I am actually going to install Sunpower panels within the next 12 months on my own roof (already signed up on the list, but have to replace roof first).

So if Sunpower is so much better "without a doubt", why on Earth did WalMart and the US Army go with SolarCity?

 

[sleepyhead]

You guys are way too defensive when it comes to Solarcity. I am here trying to help you guys make money in the stock market by bringing up investment ideas such as Sunpower. And I am trying to get you guys to consider installing Sunpower panels instead of blindly installing Solarcity (who buys commodity Chinese panels) to save you potential headaches and money. All I get is thankless and defensive responses:

So if Sunpower is so much better "without a doubt", why on Earth did WalMart and the US Army go with SolarCity?

This sounds like a rebuttal that a 12 year old would write. Tell me more about those two deals and I will tell you why they went with Solarcity. I would bet that you don't even know the details, but there could be several reasons they went with Solarcity:

1. Walmart does not have limited roof space like you do on your own house. They don't need to fill entire roof. SPWR is much more valuable when roof space is limited!

2. Walmart's management is short term oriented and a solarcity system may be cheaper over the first few years, which will equate to better profits over the next few years, which means higher bonuses for the executives and better short/mid-term shareholder returns.

3. Military housing is the same thing. Lower initial lease payments, and we will worry about raises later...

4. Why did Verizon go with Sunpower? Why did Buffet spend over $2bn on a Sunpower Power Plant? See how pointless such a rebuttal is?

Solarcity has a real good business model, but if you calculate Levelized Cost of Energy (LCOE) then Sunpower comes out on top. Fortunately for Solarcity and other competitors nobody understands this concept and Solarcity is perceived to be the low cost provider. For that reason I own SCTY shares as well as Sunpower. I still have faith that eventually people will figure this out and Sunpower will come out on top, but if I am wrong then Solarcity will be the clear winner, hence I own both companies.

Once again, I am trying to help you guys. No reason to get defensive.

I would bet that 90% of the people on this board who own SCTY shares could not explain to me how their business model works, what they need to accomplish in order to become profitable, or how one simple residential lease contributes to the top and bottom lines of Solarcity's Income Statement (over a 20 year period). I know that I sure as hell can't. But I can value Sunpower and know that it is significantly undervalued if you believe in the solar growth story; even after its 300%+ return in the past few months.

 

[ggies07]

You guys are way too defensive when it comes to Solarcity. I am here trying to help you guys make money in the stock market by bringing up investment ideas such as Sunpower. And I am trying to get you guys to consider installing Sunpower panels instead of blindly installing Solarcity (who buys commodity Chinese panels) to save you potential headaches and money. All I get is thankless and defensive responses:



This sounds like a rebuttal that a 12 year old would write. Tell me more about those two deals and I will tell you why they went with Solarcity. I would bet that you don't even know the details, but there could be several reasons they went with Solarcity:

1. Walmart does not have limited roof space like you do on your own house. They don't need to fill entire roof. SPWR is much more valuable when roof space is limited!

2. Walmart's management is short term oriented and a solarcity system may be cheaper over the first few years, which will equate to better profits over the next few years, which means higher bonuses for the executives and better short/mid-term shareholder returns.

3. Military housing is the same thing. Lower initial lease payments, and we will worry about raises later...

4. Why did Verizon go with Sunpower? Why did Buffet spend over $2bn on a Sunpower Power Plant? See how pointless such a rebuttal is?

Solarcity has a real good business model, but if you calculate Levelized Cost of Energy (LCOE) then Sunpower comes out on top. Fortunately for Solarcity and other competitors nobody understands this concept and Solarcity is perceived to be the low cost provider. For that reason I own SCTY shares as well as Sunpower. I still have faith that eventually people will figure this out and Sunpower will come out on top, but if I am wrong then Solarcity will be the clear winner, hence I own both companies.

Once again, I am trying to help you guys. No reason to get defensive.

I would bet that 90% of the people on this board who own SCTY shares could not explain to me how their business model works, what they need to accomplish in order to become profitable, or how one simple residential lease contributes to the top and bottom lines of Solarcity's Income Statement (over a 20 year period). I know that I sure as hell can't. But I can value Sunpower and know that it is significantly undervalued if you believe in the solar growth story; even after its 300%+ return in the past few months.

Hey now, I thanked you for the first bit of info you gave me. This is all very informative and I'm glad you spoke up. I will look into Sunpower. Do you know how the managemnt of the company is run? Do you like who is in control? Thats something I look at when investing.

Looking at their website it says they have dealers that you buy their product from. So they dont actually install it like solarcity? And they have a two tiered system of dealers - elite and premier. That sounds laughable......

 

[sleepyhead]

Hey now, I thanked you for the first bit of info you gave me. This is all very informative and I'm glad you spoke up. I will look into Sunpower. Do you know how the managemnt of the company is run? Do you like who is in control? Thats something I look at when investing.

Well there are several thankful people, but most responses I get are defensive without much elaboration.

Management is obviously not as good as Elon Musk, but I don't know much about Lyndon Rive so I couldn't compare him to SPWR CEO Tom Werner. I know that Sunpower has a great business plan and I would encourage you to listen to their May 15, 2013 analyst day presentation (it is on their website in investor section) and don't forget to download the slides. I heard the CEO speak several times and he sounds like a great leader. They understand their shortcomings and they are working on fixing them. E.g. right now it takes 6 months from when you sign a Sunpower Lease, including 3 weeks to get paperwork done, to when it finally gets installed. They want that down to 30 days in 2014. And by 2015 you will be able to order and setup financing on-line in 15 minutes and have your system installed within 15 days.

They have great innovative products, such as C7 Tracker that allows them to build a 1 MW system using only 170 KW of panels, while using 7 times less land. There are many things going in Sunpowers favor now.

Solarcity has the advantage in residential leases because it has the backing of Goldman Sachs and Elon's connections with them and this is HUGE! The only bottleneck in residential leases is financing. SCTY just announced a $500mn deal with Goldman, but that will only get you about 15,000 homes which is peanuts compare to SCTY's market cap. SPWR announce a deal with US Bancorp for $100 million, which is even smaller peanuts and they said they ran out of financing after installing only 2,100 units in Q1. This is a huge upside to solarcity and they might dominate the space if this keeps up. I am hopeful that Total S.A. (France's version of Exxon?), who owns 66% of Sunpower, starts funding some of these projects for Sunpower, but who knows).

I am long both companies and own both. I think Sunpower will be the winner, but don't want to miss out on Solarcity if I am wrong (which is very possible). One company will return 200% returns from today and the other 1000% returns. I don't know which it will be, therefore I own both companies although slightly skewed towards Sunpower.

 

[CyberDutchie]

Looking at their website it says they have dealers that you buy their product from. So they dont actually install it like solarcity? And they have a two tiered system of dealers - elite and premier. That sounds laughable......

What I like about SolarCity is that they keep everything in house, no dealers to do the sale, or consultants to do the permitting, or subcontractors to do the installations. From my personal experience, the employees who came to my house for the assessment were all well educated young professionals. They represent the company extremely well, it gives you the feeling that, yes, this company is the future, and they are here to stay.

Of course, one might get the same feel from SunPower, I don't know because I never had them over to look at the situation at my home--just went with SolarCity because of the Elon connection and it has been a great experience working with them so far.

Regarding the choice of panels, in my view I prefer a solar lease company who actually doesn't design and manufactur their own panels, but instead uses the most reliable panels that have been on the market for a while, like SolarCity does. They may not be the panels with the absolute highest output, but I prefer reliability versus a few more watts and a maintenance guy on your roof all the time.

 

[woof]

I would go with Sunpower if I were you. Why would you want to put cheap Chinese made panels on your roof. They have higher degradation, perform worse in various climate conditions, etc. Who knows how good they will be in 10 years time.

SCTY often uses Chinese made panels, which are indeed less expensive than SPWR modules. But, as SCTY is the owner, and you get to use the power...do you care? Really? Do you care if your power company uses Siemens or GE generators? If the panels don't perform its SCTY's reputation and money on the line--and it really is money to them, as they do have to pay you back for kWh that aren't generated as per the agreement, and as they often sell SRECs, non-performing panels are a direct assault to their income stream.

With Sunpower you will get the best, highest quality, most efficient panels in the world. And financially speaking you will be better off too compared to going with Solarcity. Not to mention that you will get a much bigger system (in Watts) per sq. ft of roof space.

I agree, I really like SPWR panels. But that said, the high wattage modules are cutting edge and quite expensive. IF you have a small roof, then they can make a lot of sense. But if you have enough space, the extra cost may not be worth the extra power. And don't forget, SPWR panels aren't domestically produced, so the "made in USA" factor isn't in SPWRs favor either. And financially speaking, for me I was better off with SCTY.

Lease is a liability if you want to sell your house. But if you go with Solarcity, then lease is the only option.

SCTY has several options, including outright buy. If you ask them, you can even lease and STILL get the SRECs. It's all in what you ask for. I found SCTY to be the most flexible and cost effective. Can't hurt to ask both companies and compare. For me, I pre-paid upfront, so for about 1/4 the cost of purchasing outright, I get to use all the power from the panels for the next 20 years, with no additional costs, including inverter replacement and panel repair. Would I have picked different panels and inverters if I were buying it for myself? Yep. Would I have over engineered it and spent more than I should doing that? Yep. But I discovered after thinking long and hard, all I really want is cheaper electricity, and after crunching the numbers from several different vendors, pre-paying from SCTY made the most sense for my situation.

No way would I ever purchase those cheap Chinese solar panels. If you go with Sunpower then definitely buy; you will get the tax credit and a 25 year warranty. The panels will probably last longer than that too.

Well, to each his own. If you like SPWR panels, buy 'em. But, if you don't really care about who makes the panels or the inverters, and you trust SCTY to back them up and be around for the next 20 years to service them, then it makes sense to give SCTY a call. To me, pre-paying for 20 years worth of power made the most sense. I could buy outright for 4 times the price, and still get the same amount of power in the end. The only down side I could find was that I didn't get to pick the panels and the inverters. I decided to trust SCTY to engineer it to work for them, and that works for me.

 

[sleepyhead]

Regarding the choice of panels, in my view I prefer a solar lease company who actually doesn't design and manufactur their own panels, but instead uses the most reliable panels that have been on the market for a while, like SolarCity does. They may not be the panels with the absolute highest output, but I prefer reliability versus a few more watts and a maintenance guy on your roof all the time.

This statement is, to put mildly, very inaccurate. Solarcity uses mostly Yingli and Trina solar panels. These companies have been in business for only 15 years, and their only goal over the last several years has been to decrease costs; including using cheaper materials, production techniques, etc. Chinese solar panels are not reliable at all. I would encourage everyone to read this article from the NY Times about solar panel defects by Chinese Manufacturers (they also mention a US manufacturer, which is most likely First Solar):

http://www.nytimes.com/2013/05/29/b...lar-powers-dark-side.html?pagewanted=all&_r=0

When it comes to reliability, Sunpower panels are by far the most reliable panels on the market.

If you don't like that Sunpower uses a dealer network that is fine, but don't go saying that Solarcity uses more reliable panels because that is just incorrect. The Sunpower Dealers do all the paperwork for you just like solarcity does, only difference is that it is not in house. I can understand if you don't like this, but negatives are also offset by some positives: e.g. dealers are not on Sunpowers payroll, so this will help their net profit margins, and also allows them to scale much quicker (especially globally), which Solarcity may struggle to do since it requires huge capital investments for them.

Like I said, I like both companies and I am trying to educate you guys on other options to invest and make money. Some of Solarcity's strengths may become weaknesses in the near future. Right now there is an oversupply of panels on the market, which is a huge benefit to Solarcity. But the industry is consolidating, companies are going bankrupt, and capacity is coming off line. Demand on the other hand is only increasing. What happens if 2-3 years from now demand exceeds supply? All of a sudden Solarcity's biggest strength will become it's biggest weakness and the company could potentially suffer. This would hugely benefit a company like Sunpower who would make killer margins on its own products.

There are so many things that people are not factoring in when it comes to investing in the solar industry. The market is very reactive to this industry because it does not want to get burned again. I on the other hand am a very proactive investor. I have been buying SPWR on the way down starting at $7, then $5, then $4, because I knew it would turn around and eventually it did. Right now the company is only fairly valued if you consider no/small growth from the company (less than 10% per year); i.e. IMO it is grossly undervalued. But the solar industry is just getting started and I expect huge returns.

Solarcity will get huge returns too, but I cannot say that it is undervalued even after making a 40% correction.

 

[sleepyhead]

SCTY often uses Chinese made panels, which are indeed less expensive than SPWR modules. But, as SCTY is the owner, and you get to use the power...do you care? Really? Do you care if your power company uses Siemens or GE generators? If the panels don't perform its SCTY's reputation and money on the line--and it really is money to them, as they do have to pay you back for kWh that aren't generated as per the agreement, and as they often sell SRECs, non-performing panels are a direct assault to their income stream.



I agree, I really like SPWR panels. But that said, the high wattage modules are cutting edge and quite expensive. IF you have a small roof, then they can make a lot of sense. But if you have enough space, the extra cost may not be worth the extra power. And don't forget, SPWR panels aren't domestically produced, so the "made in USA" factor isn't in SPWRs favor either. And financially speaking, for me I was better off with SCTY.


SCTY has several options, including outright buy. If you ask them, you can even lease and STILL get the SRECs. It's all in what you ask for. I found SCTY to be the most flexible and cost effective. Can't hurt to ask both companies and compare. For me, I pre-paid upfront, so for about 1/4 the cost of purchasing outright, I get to use all the power from the panels for the next 20 years, with no additional costs, including inverter replacement and panel repair. Would I have picked different panels and inverters if I were buying it for myself? Yep. Would I have over engineered it and spent more than I should doing that? Yep. But I discovered after thinking long and hard, all I really want is cheaper electricity, and after crunching the numbers from several different vendors, pre-paying from SCTY made the most sense for my situation.



Well, to each his own. If you like SPWR panels, buy 'em. But, if you don't really care about who makes the panels or the inverters, and you trust SCTY to back them up and be around for the next 20 years to service them, then it makes sense to give SCTY a call. To me, pre-paying for 20 years worth of power made the most sense. I could buy outright for 4 times the price, and still get the same amount of power in the end. The only down side I could find was that I didn't get to pick the panels and the inverters. I decided to trust SCTY to engineer it to work for them, and that works for me.

1. That is a point I am trying to make. If Solarcity guarantees you 12,000 KWh/year they will pay you the difference if the Chinese Panels underperform. But if Sunpower guarantees you 12,000 kwh then there is an extremely high probability that you will get that amount and then some more, because they are conservative in their degradation number on the lease contract and their panels will outperform (not to say chinese panels won't, but I have my doubts especially after 5-10 years based on some research I have seen). Chances are you will get a lot more than 12,000 and probably over 13,000 with Sunpower. 13,000 is better than 12,000, and you get to pocket the difference. This is one point that absolutely nobody takes into account when comparing Sunpower and Solarcity leases, but will make a big financial impact.

2. I agree that Sunpower is mostly beneficial to those that have limited roof space. Solarcity may be a better option if you have a big southern facing roof.

3. What I meant to say is if you are going through Solarcity then do not buy the panels (it shouldn't be an option to seriously consider); Lease them or PPA instead. If you are going through Sunpower then you may be better off buying because you get 25 year warranty and the panels will probably last 40 years or more.

Solarcity and Sunpower are both good options depending on your individual situation.

 

[CyberDutchie]

This statement is, to put mildly, very inaccurate. Solarcity uses mostly Yingli and Trina solar panels. These companies have been in business for only 15 years, and their only goal over the last several years has been to decrease costs; including using cheaper materials, production techniques, etc. Chinese solar panels are not reliable at all. I would encourage everyone to read this article from the NY Times about solar panel defects by Chinese Manufacturers (they also mention a US manufacturer, which is most likely First Solar):

http://www.nytimes.com/2013/05/29/b...lar-powers-dark-side.html?pagewanted=all&_r=0

When it comes to reliability, Sunpower panels are by far the most reliable panels on the market.

...

What happens if 2-3 years from now demand exceeds supply? All of a sudden Solarcity's biggest strength will become it's biggest weakness and the company could potentially suffer. This would hugely benefit a company like Sunpower who would make killer margins on its own products.

Thanks for the additional insights into Sunpower, I may take a closer look at them. I never said their panels are unreliable, just repeated what the SolarCity guys told me, and that is that they don't use the newest panels, only the tried and proven ones that have been on the market for a few years.

Regarding SolarCity being undervalued or not, my motto is that highs are eventually going to be tested again, unless there is something major going the wrong way for the company. I don't think your scenario of demand exceeding supply would be one of those. SolarCity is a major buyer and all a supply shortage would do is increase the cost of the panels to them. Which they would probably pass through to the consumers of their services anyway.

 

[vfx]

My research also had me deciding on Sunpower panels (and did not have the stock but will soon) I just wish Solar City would install Sunpower panels so the Elon triad gets a boost.

 

[DaveT]

Press release from White House this morning about Obama's carbon reducing plans, http://m.whitehouse.gov/the-press-office/2013/06/25/fact-sheet-president-obama-s-climate-action-plan

 

[serkol]

Press release from White House this morning about Obama's carbon reducing plans, http://m.whitehouse.gov/the-press-office/2013/06/25/fact-sheet-president-obama-s-climate-action-plan

No carbon tax yet? Just carrots, same as in the past, and no sticks? Bad...

 

[sleepyhead]

I think that the President sweating out there in the heat is very complementary to this speach.

 

[Norse]

I think that the President sweating out there in the heat is very complementary to this speach.

doing good for SCTY atleast. Big buy and big up: 7.19%