Google’s become especially keen on the idea of solar leasing, which drastically reduces the upfront costs of installing a residential solar power system by enabling homeowners to ‘lease’ rather than purchase outright.
In June, Google announced that it was investing $280 million to create a similar fund with SolarCity, its largest clean energy project investment to date.
SolarCity’s leasing options range from prepaying to paying nothing upfront and then making monthly lease payments. Google engineer Michael Flaster expects to save $100 a month on his electric bills and $16,000 over the 15-year life of his lease with SolarCity, that’s after figuring in his lease payment and lower energy bills.
The firm will provide $75m to build 3,000 residential solar electricity systems across the US. Google will own the panels, and get paid over time by customers who purchase the electricity the panels produce.
The company is creating a fund with a San Francisco company called Clean Power Finance that local solar installers will be able to tap so they can offer financing plans to prospective buyers.
The plans allow homeowners to install a $30,000 solar electricity system on their house for little or no money up front.
Instead, customers pay a monthly fee that is the same or less than what they would otherwise be paying their local utility for power.
Google will earn what it calls an attractive return on its investment in two ways. It gets the monthly fee from homeowners, and, as the owner of the systems, Google will get the benefit of federal and state renewable energy subsidies.
The systems will not carry the Google brand, however. Instead, local installers will offer the financing deal under their own brands.
Solar power has gotten dramatically cheaper, but the up-front cost for a homeowner remains formidable. A typical home system costs $25,000 to $30,000. Federal and state governments offer subsidies to help defray the cost somewhat, but it is still far too much money for many homeowners to shell out.
One of Google’s ten philosophical pillars is: “You can make money without doing evil,” and reducing the environmental impact of its business has long been a focus of co-founder and CEO Larry Page. The company says that since 2007, it has completely offset its emissions of greenhouse gases by paying for projects that remove greenhouse gases from the atmosphere.