In any case, I think there is clearly demand for leasing as well as outright ownership and buyers will choose what's best for their situation. When the rebates disappear, that will exacerbate the effect of the property tax increases as well, if system prices don't come down significantly.
That is an interesting point with the home value implications. Just keeps me coming back to what is the real value of a PV system? Is is best to own or to lease? Do you want to be in the energy business or do you want to pay for someone else to be? What are the true maintenance costs OVER 30 YEARS?
When you purchase a PV system, you do get every KW for yourself after the payback period. That is true. But now you are in business relationship with the traditional utility. If you don't think so, what do you call net metering? In the beginning, net metering wasn't a big deal for utilities, but now as millions of people are getting PV systems, it becomes a big deal and utilities are much bigger, with a lot more cash and power then you. If they don't want to pay you that retail rate, they will try and find a way to not to do it. Let's look at this over the next 10,20,30 years. Do you really think you're going to get the same retail price on your KWs that you enjoy today? Is this something you understand from your PV installer before they put it in? The first thing they should ask you when considering buy is DO YOU WANT TO BE IN THE ENERGY BUSINESS? Because you're going to lose money fast if you think you're going to command retail prices on your energy production in the coming years.
At least in a lease/ppa specificially with Solarcity, they are take on the problems of being in the energy business. If net metering goes, they have a deep interest in finding a solution to getting you cheaper, cleaner energy then your current utility provider. THEY have the EXACT same interest as you do. So, they are forced to bring you a solution to net metering and every other issue that comes down the pike 10,20,30 years down the road.
When you buy, what will the value of your system be 30 years down the road? How many random things could happen to your system down the road? Does your warranty cover LABOR COSTS of if something under warranty needs to be replaced? The average American sells their own after 11 years. If we are talking about MASS MARKET, MILLIONS OF INSTALLATIONS, the we must use the average and that means over a 25 year warranty ownership will change once, and then the follow on owner after that will be stuck with no warranty and an well aged system with degraded production. And when you move, do you get another crack at the 30% ITC if you put on a system on your new house? Nope. Well you could just bring it with you. But that will cost MORE than they system is worth. Now lets say your system sucks after 30 years and you want the latest and greatest. Got to pay to take it off and pay for someone to put the new system on. Again, tax incentives are no longer a benefit. What... you think you're going to be able to recoup a little and sell it on Ebay? Good luck with that. Hey, it's best to buy a house since the value goes up on average over time. It's good to buy a car, you can always sell it and get a new one. BUT, you can't just replace a PV system, and if you do it's damn expensive. It's a MULTI-DECADE purchase, that NEVER appreciates in value, and DOES NOT HAVE RESALE VALUE. The parts might come down in price, but the LABOR COSTS never do. Do the math, how much labor costs will you have to pay over a 30 year peiod, especially if you're a second owner, and definitely if you're taking on a system that's at the end of it's warranty period. In the case of PV system, given these issues, lease makes the most sense in the real world with all it's uncertainties over multiple decades.
When you lease/ppa you buy the energy that you will be using. This will be the same no matter what technology comes out, what new policies come out, or what the weather turns out to be. I see solarcity will make sure you get that cheaper, cleaner electricity despite all problems that will occur over the next decades because their interests are aligned with yours. They will take on net metering for you with energy storage products. They will take on policy, they will take on the elements, so you can live your own life and do what you need to do to better your situation. Worrying about your PV system is the last of your concerns.
Now what is the value of that service Solarcity provides? That's the magic question. Given everything that comes with being in the energy business and making a multi-decade commitment to that, I think it's just as hard for you to estimate that value as it is for you to do with ownership of your own system. However, I do know I have only so much time in my life to live it, and if I see a SERVICE that will provide me with cheaper, cleaner energy for decades WITH THE PEACE OF MIND of knowing I will not have to worry about things no matter what happens in my life... then I might be willing to pay AT THIS MOMENT IN TIME ABSENT CHANGES IN NET METERING a premium compared to purchasing. And if net metering changes for the worse and SolarCity offers me a battery for back up still providing me with cheaper cleaner energy, where ownership fails, then I will really know I made a fantastic financial decision over the long haul.
Please keep it coming.
