{"id":17068,"date":"2011-12-02T14:04:02","date_gmt":"2011-12-02T22:04:02","guid":{"rendered":"http:\/\/blogs.kqed.org\/climatewatch\/?p=17068"},"modified":"2011-12-02T14:04:02","modified_gmt":"2011-12-02T22:04:02","slug":"solarcitys-military-deal-a-boost-for-the-biz","status":"publish","type":"post","link":"https:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/","title":{"rendered":"SolarCity\u2019s Military Deal a Boost for the Biz"},"content":{"rendered":"
\"\"<\/a>
A rooftop solar array on a home in Vacaville.<\/figcaption><\/figure>\n

SolarCity’s announcement this week that the company is moving forward with a massive military housing solar project, may be more than just a boost for one company. It’s another indication that despite a turbulent few months, the solar industry is alive and thriving.<\/p>\n

By itself it\u2019s a big deal that SolarCity and Bank of America Merill Lynch are teaming up<\/a>\u00a0without a government loan guarantee. That isn\u2019t traditionally how it’s been done. Private investors usually like the security of a guarantee before they get into a big, risky investment. But in an interview with KQED\u2019s Lauren Sommer, SolarCity\u2019s CEO Lyndon Rive says this investment isn\u2019t actually very risky, \u201cWe\u2019re selling electricity; the consumer needs it. It\u2019s not like you are financing a car where they can skip on their financing payments. It is a necessity.\u201d<\/p>\n

<\/p>\n

\u201cIt\u2019s exactly what the program was intended for,” says Rive, who sees the deal as a sign that the federal loan guarantee program is doing its job. “The government came up with the loan guarantee program about two and half to three years ago with the intent to get private capital to the market, so that private capital would finance solar systems after the loan guarantee went away,\u201d he told Sommer.<\/p>\n

That model has panned out for SolarCity. Originally, the firm was angling for a federal loan guarantee, but the firestorm around Solyndra\u2019s collapse made it impossible for them to meet the program\u2019s September 30th<\/span>\u00a0deadline. Rive says he always believed they\u2019d find the financing somehow.<\/p>\n

\u201cWhen we started in 2010 the only way I was getting this done was through the loan\u00a0guarantee. Through the year of hard work and not getting the loan guarantee there was no doubt in my mind that we would do this privately,\u201d he asserted.<\/p>\n

Private investment comes at price. Originally, SolarCity wanted to install panels on 160,000 units instead of the 120,000 announced. But Rive says the loan from Merrill is going to cost them a bit more, so they had to scale back. He remains optimistic, saying that losing the federal guarantee wasn\u2019t all bad news. \u201cThe loan guarantee comes with a lot of restrictions on it,” said Rive. “The plus is low cost of capital. The minus is all the restrictions,\u201d he admitted.<\/p>\n

[module align=”left” width=”half” type=”pull-quote”]”When we started in 2010 the only way I was getting this done was through the loan\u00a0guarantee.”[\/module]<\/p>\n

The federal loan guarantee has been an important way for solar firms to attract investors. Another crucial tool that renewable energy companies have used to weather the recession — and the lack of liquidity and investment dollars that came with it — is a tax provision known as \u201c1603\u201d for the section of federal law that authorized it. It allows companies to take a cash grant instead of the 30% tax credit that they’re entitled to under tax law. The provision is set to expire at the end of the year. Without it, renewable energy companies say they\u2019ll have a lot more trouble coming up with the cash they need to finance new projects. A coalition of 750 businesses and organizations sent a letter<\/a>\u00a0to Congress this week, asking them to extend the provision.<\/p>\n

For now, SolarCity\u2019s contract with private military housing companies represents a ray of hope for solar. Rive claims that only 180,000 solar systems have been installed across the country in the last 30 years. The 120,000 announced will almost double that in five years’ time. \u201cRight now we are at less than one-percent penetration in the\u00a0US, but that\u2019s not even close to where it needs to be. We need to get to 10-20% penetration in the\u00a0US.\u00a0before we get true economies of scale. Once we get to that point we\u2019ll be able to make solar work without incentives,\u201d concluded Rive.<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

That’s a lotta roofs on a lotta bases.<\/p>\n","protected":false},"author":234,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3,5],"tags":[468,479],"coauthors":[],"series":[],"affiliates":[],"programs":[],"collections":[],"interests":[],"class_list":["post-17068","post","type-post","status-publish","format-standard","hentry","category-government-business","category-power","tag-renewable-energy","tag-rooftop-solar"],"acf":{"template_type":"standard","featured_image_type":"standard","is_audio_post":false},"yoast_head":"\nSolarCity\u2019s Military Deal a Boost for the Biz | Climate Watch<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"http:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"SolarCity\u2019s Military Deal a Boost for the Biz | Climate Watch\" \/>\n<meta property=\"og:description\" content=\"That's a lotta roofs on a lotta bases.\" \/>\n<meta property=\"og:url\" content=\"http:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/\" \/>\n<meta property=\"og:site_name\" content=\"Climate Watch\" \/>\n<meta property=\"article:published_time\" content=\"2011-12-02T22:04:02+00:00\" \/>\n<meta property=\"og:image\" content=\"http:\/\/ww2.kqed.org\/climatewatch\/wp-content\/uploads\/sites\/54\/2011\/12\/rooftop_solar-300x225.jpg\" \/>\n<meta name=\"author\" content=\"Katrina Schwartz\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@kschwart\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Katrina Schwartz\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"http:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/\",\"url\":\"http:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/\",\"name\":\"SolarCity\u2019s Military Deal a Boost for the Biz | Climate Watch\",\"isPartOf\":{\"@id\":\"https:\/\/ww2.kqed.org\/climatewatch\/#website\"},\"datePublished\":\"2011-12-02T22:04:02+00:00\",\"dateModified\":\"2011-12-02T22:04:02+00:00\",\"author\":{\"@id\":\"https:\/\/ww2.kqed.org\/climatewatch\/#\/schema\/person\/39eb8de73cfee10d657c92249ec16212\"},\"breadcrumb\":{\"@id\":\"http:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"http:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"http:\/\/ww2.kqed.org\/climatewatch\/2011\/12\/02\/solarcitys-military-deal-a-boost-for-the-biz\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/ww2.kqed.org\/climatewatch\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"SolarCity\u2019s Military Deal a Boost for the Biz\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/ww2.kqed.org\/climatewatch\/#website\",\"url\":\"https:\/\/ww2.kqed.org\/climatewatch\/\",\"name\":\"Climate Watch\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/ww2.kqed.org\/climatewatch\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/ww2.kqed.org\/climatewatch\/#\/schema\/person\/39eb8de73cfee10d657c92249ec16212\",\"name\":\"Katrina Schwartz\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/ww2.kqed.org\/climatewatch\/#\/schema\/person\/image\/68d4dc78000d2d4fc0cdfcf780b2b7ba\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/a6a567574dafefa959593925eead665c?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/a6a567574dafefa959593925eead665c?s=96&d=mm&r=g\",\"caption\":\"Katrina Schwartz\"},\"description\":\"Katrina Schwartz is a journalist based in San Francisco. 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