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I Bought a House with Solar Panels

416 points by sphuff 8y ago

jrochkind1 8y ago
> Hugh Bromley, a solar analyst at BloombergNEF, says Sunrun and its competitors offer solar, sure, but can be better understood as having created “one of the most sophisticated financial engineering industries of any sector of the U.S. economy.” While this is just a prejudice and their financial engineering _may_ be totally sound, this makes me think of CDOs and the mortgage crisis and all that. The fact that the deal may not actually be all that good for the consumer -- and may complicate sales of their house since it's effectively a lien forcing future buyers to take a deal which may be _more apparent as bad_ in the future -- only makes me again think of the financial hijinx that led to the mortgage bubble/crisis.
- sjjshvuiajhz 8y ago
  While this may remind some people of the mortgage bubble, solar is nowhere near as important to the economy as home prices are. The potential to take down the economy isn’t there, the numbers are too small.
CompelTechnic 8y ago
>Supporting renewable energy is important, and I get spending a little more to help the planet. But a for-profit company like Sunrun wasn’t my idea of the right place to do it. That's a pretty strange sentiment. 20 years ago, solar was decidedly more expensive than it is now. A fair price would be higher than grid power. For the installation to have occurred at all, the up front capital cost had to be amortized by a for-profit company in an attractive way. This appears to have been crafted as a payment schedule that's slightly back-heavy. Seems to me that the author just didn't want to be left holding the bag, but still wanted to pay lip service and feel like a good environmentalist.
- deleted 8y ago
  [deleted]
- daveFNbuck 8y ago
  The article is about a solar installation done in 2016.
  - CompelTechnic 8y ago
    Ah, sorry. Yeah, I must have misremembered "20 years" from the first quote below. Doesn't materially change my argument, I think. Another important point, in my opinion, is the cost given in the second quote below is a fair cost. $6000 over 20 years is an average cost of $300 per year. If you are purchasing 2016-era installed solar, knowing that it is a less cost-effective form of electricity generation than conventional means, an amortized (predicted) cost of $300 per year is fair. Refusing to pay this and still claiming to "be willing to pay a little extra to help the planet" is hypocritical. >I got ahold of a copy of Jug’s contract, and quickly saw how Sunrun could afford to extend such an offer. It lasted 20 years. The payments escalated annually by 2.9 percent—they’d be 72 percent higher by 2036. The tax credit was worth at least $5,000. >If Southern California Edison's residential rates continue to rise annually by 2.2 percent, as they have on average over the last decade, Jug's total electricity outlay having gone solar would have cost about $6,000 more over 20 years.
    - daveFNbuck 8y ago
      You're mixing up two different sets of numbers here. $6,000 is the extra amount that Jug would have paid after being sold the solar installation as a way to save a lot of money over the next 20 years. The author, who was willing to pay a little more to save the environment, would have been paying an extra $30/month from the start, before the annual increases started widening the gap. Their bills without the solar started at $30/month, so this would start out doubling their bill and increase from there.
- matthewdgreen 8y ago
  Seems like one thing to make the payment schedule back-heavy and be honest about it, another thing to use unrealistic assumptions about utility price increases to disguise this payment schedule as a lifetime cost savings.
  - ocdtrekkie 8y ago
    And the huge issue is that if it's a back-heavy payment scheme: A future buyer will only see the heavier portion. Which makes your house less attractive to a buyer, and devalues your home, which also hurts any potential cost savings.
    - CompelTechnic 8y ago
      The growth rate of the payment is 2.9%. This is only very slightly higher than inflation, on average. Also, assuming that the lower home value came true, the original purchaser of the solar installation did put his money where his mouth is, and paid a financial cost to his environmental interests, which is the moral thing to do, regardless of whether he was "tricked" by the negative cash flows showing up in later years (and in this case, when he was dead). I guess my main point from my multiple posts is that there is no free lunch. If the fully amortized cost of solar is higher than grid power, someone will have to pay. Someone with buyer's remorse, who fully understood the cash flow implications at the time of purchase, can still feel like they were tricked. And maybe, the pessimistic projections of grid power costs made by sunrun should be taken with a grain of salt, and it should also be acknowledged that this deceptive practice is helping the planet. Maybe a game theory perspective is valuable here- assuming cooperation is possible, people place an irrationally small cost to global warming, and discount future costs (in this case, of their power bill) to an irrationally large degree. The way to get people to cooperate is to trade one irrational impulse for another.
      - ocdtrekkie 8y ago
        Sure, someone is going to have to pay for greener power. But the problem is that Sunrun is claiming it's cheaper, even though it isn't, and that the owner ends up paying both Sunrun's expenses and their profit margin.
- gwbas1c 8y ago
  Owning your panels with a loan is an excellent investment. Leasing them isn't.
- barkingcat 8y ago
  This seems really suspicious to me since in the article they clearly stated that their electricity usage was much lower than the previous owner, who was running some kind of server farm there. Of course someone needed to pay, but it seems wrong to pay extra for electricity they are not using to pay lip service for supporting a for-profit company who had locked in the plan with an earlier contract.
kryogen1c 8y ago
>Accounting for all these things, taking on Jug’s lease would translate to us paying at least $30 a month more. We’d lose money from Day 1 I'm unsure how I feel about this. $30 is a significant % of the electric bill, but is a very small % of the cost of owning a home. Didn't solar start as economically viable due to heavy government tax incentives? I'm ignorant of the data, but I thought solar was not fit for public deployment has only edge use cases.
- zdragnar 8y ago
  Take that $30, stick it in a savings or investment. When solar prices go down, or utility prices go up, take the money you've saved up and then put it towards the purchase. There's no point in throwing away money on a losing proposition, since in this case the homeowner wouldn't be the one to get the credit. As an additional bonus, your home will have newer, more efficient panels with a longer remaining estimated lifetime, so if you do end selling the house they'll add more value. A solar install in a reasonably sunny climate can pay for itself over its lifespan, but you need to actually stay there the whole time, or hope that the added value to your house makes up for whatever your investment was.
wccrawford 8y ago
>It’s far more common for home sellers to transfer the lease to the buyer—Sunrun says 94 percent of customers do this—or to prepay the lease and leave the hardware on the roof for the next owner to use. I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000 and allowed us to support solar and get “free” electricity, even as Sunrun remained responsible for maintenance and repairs. I'm not surprised Sunrun chose not to tell them about that option as it seems like a losing situation for them. They claim that Sunrun would have been covered, but that merely means they fail to lose money. They stood to make money on that system, and no sane solar panel buyer is going to have heavily used panels put in. >Aided by a local attorney and my father-in-law, a retired contract attorney, I drafted a letter to Jug’s trust accusing the listing agents of failing to deliver title to the property free of any third-party claims as the agents had said they could. I threatened legal action. It was a last-ditch effort that none of us expected to work. Then it did. I'm not surprised this worked. Their whole job is to present the actual situation during the sale and they failed at it. There are probably a lot of legal issues with what they did and I bet the agent was quaking in their boots at the thought of that going to trial.
- sthu11182 8y ago
  regarding the legal action: based on my recollection from real estate class in law school, failing to provide a free and clear title on a general warranty deed is a pretty straight forward victory. if i remember anything from that class, always get a general warranty deed (ie a deed with all the covenants) when buying a house.
  - toomuchtodo 8y ago
    Your class was correct (I just had to go through this very scenario this week, albeit not for solar, with a local title company transferring some property). Never take action that is going to jeopardize free and clear title on your real estate.
  - zaroth 8y ago
    I’ve never seen anything but a quitclaim deed offered at closing. The P&S stipulate the deed is clear, but the buyer runs the title search. If you find something (like TPO panels) attached, there’s a “make right” clause which usually has a maximum amount paid of 1% after which the seller can walk away. If you want protection for anything after the sale, you buy owners title insurance.
AlphaWeaver 8y ago
>One former Bay Area employee sent me a Sunrun training manual he said was current when he resigned in April 2017. It’s called “Power Play 2.0: The Guide to Successfully Sell Sunrun.” (The company confirmed its authenticity.) It instructs salespeople to sow distrust in and disdain for traditional utilities and appeal to customers’ emotions. Over 61 pages, pain is cited at least 31 times and fear at least a dozen. When reviewing a customer’s traditional utility bill, the trainee is told, “amplify the pain significantly.” Among “components of success”: “creating pain and fear.” Among the “five fatal flaws” to avoid: “failing to build pain or fear.” Not the company I want to be stuck in a 20-year contract with.
- rrauenza 8y ago
  We got a quote from sun run - it made us uncomfortable how all of their numbers assumed ridiculous utility rate increases. And our gut said we should just wait and purchase instead. A few years later solar prices came down and we made a purchase with an installer whose main business was purchase, not lease. edit: I responded below, but my complaint isn't with their price -- it's their scare tactics and fuzzy break even financial calculations assuming wild rate increases. We went with a vendor who was more open and honest about the break even calcs.
  - macspoofing 8y ago
    To be fair, the cost of solar panels at the time you were considering them was what it was. Someone needed to pay for them. If that someone is Sunrun, they need to recoup those cost and make a return. You can be as creative as you want with the financing, that reality won't change. You could have gotten a bank loan too.
    - CydeWeys 8y ago
      No, someone did not need to pay for them. That's not how the market works. If no one is willing to pay the listed price then the product goes unsold. Sunrun has no right to paying customers at any arbitrary price level, same as any other business.
seiferteric 8y ago
I had a very similar experience when selling my house but with vivint solar. I had panels installed less than a year before and soon found out all these issues. Should have read the contract more thoroughly of course, but I am pretty sure the sales people mislead or even lied to me when I asked them questions about what happens if we move etc. Luckily the buyer agreed to take over the lease. If/when I get panels on my new house, I will almost certainly buy them outright.
xfour 8y ago
Ahh yes Sunrun. We bought a house and our realtor had the foresight to investigate the situation before we closed on the home. We got a letter disclosing the system was owned free and clear. We setup the online tracking portal only to notice that they transferred the account like thousands of dollars in owed monies from the previous owner. After getting a call from the company trying to strongarm us for the debt we essentially told them to kick rocks. They should’ve just demanded that money as part of escrow and now they’re left with a debt in someone else’s name that is never going to be paid and likely a headache for us in the future.
mchannon 8y ago
A few points this person probably didn't think about: •Nobody knows what California electricity prices are going to do in the next 20 years. By terminating the system, they just traded certainty for volatility. With that attitude I hope they financed using an ARM loan. •They whined about how expensive it was, but also expressed a desire to have one or two kids someday. When you have kids, your electric bills tend to go up, and they did their math based on their "expected" usage today. •Santa Barbara has a very mild climate, but I expect in the coming years it will get hotter and muggier much more of the year, and for health reasons they'll have to put a room A/C on. Whoa, now you're using as much juice as Jug did. •PV rooftop panels in California nowadays don't quite "help the planet" to the extent their owners believe they do. The duck curve continues to get worse. •A silent majority of people think PV panels are ugly. Like, hideously ugly. They're afraid to speak out, but not to act out and point the finger at a different reason. The end result of this whole thing reminds me of one of those people 10 years ago who bought a top-end $500 cellphone locked in to a carrier on a 3-year-plan but only $50 a month, let the payments lapse 3 months in, and then tried to sell it on eBay, angry at the cellphone company for financially hobbling them when it wouldn't sell or it got returned.
- sjg007 8y ago
  You don't need AC at the beach.. Very rarely, maybe 4 days a year during Santa Anas it gets that hot... and then you will probably have evacuated due to wildfires anyway.
  - mchannon 8y ago
    And thank you for shopping at your Goleta Home Depot store. I respect what you say, but it'll be $532.78 for that window air conditioner. Cash or charge?
- Dylan16807 8y ago
  > Nobody knows what California electricity prices are going to do in the next 20 years. That's true but with the way most utility costs have been dropping, the rates are probably not going to skyrocket. > using more power The problem is the rate being too high. More use doesn't help the problem. > duck curve Sure, but not very important to this choice. > A silent majority of people think PV panels are ugly. Like, hideously ugly. Do you have evidence of how common that is? Does that include installations that are well-integrated into the roof? > cell plan A typical cell phone contract breaking fee is $350, with some pro-rating. This roughly covers the cost of a phone discount. They don't try to charge you $1400 for the entire remaining contract term.
MichaelApproved 8y ago
> It appeared that if we bought Jug’s place, we’d have to assume his lease arrangement with Sunrun. The whole article is worth reading but this headache is specifically related to leased panels. Though, leasing makes going solar easier, it is a terrible idea because of issues like these. Also, every local power company has different arrangements for residents. I live in Suffolk county, Long Island, New York. Our power company arrangement is amazing. We get to sell back any excess power at the same rate we buy it from them. Meaning, they act like a free battery. I have a 20 years term that started from the day I installed my panels to use up any excess energy they're holding for me. After that 20 years term is over, they pay me the wholesale rate for any leftover power, which is next to nothing. I don't pay extra fees for net metering but we do have the highest rates in the nation. It's roughly $0.20/kwh, including delivery, taxes and other fees. If I end up having any extra power and Crypto is still a thing, I'd just plug in a miner and drain it all. It'd be a bonus if I did it during winter and use the heat to warm the house. Regarding the purchase, I financed the purchase. Got 0% loan on the expected tax credit portion and 6.5% on the rest for 15 years. Even with the interest rates, I'll be cash-flow positive on the monthly payments. I also essentially locked in my utility costs. My local power company is expected to raise rates 3-5% a year. If I pay my loan off early, I get to avoid those rate increases for the portion of electricity that my panels cover. Anyway, if you're thinking about going solar, check your local utility rules and go for the purchase option. Leases are not worth the baggage they come with.
imgabe 8y ago
When you get down into the meat of how the tax credits and Sunrun's financing work it's astonishing. Essentially it sounds like Sunrun's investors are paying to install solar panels on your house so they can claim the tax credit to offset their own income. Meanwhile you are paying Sunrun for the electricity generated by the solar panels. There doesn't seem to be much benefit for the homeowner. You're better off buying the system up front if possible or even financing it and claiming the tax credit yourself. Then you'd only have to pay the utility for the electricity you don't generate. "The American way" anymore seems to be to take a good idea, overcomplicate it with financial engineering, and funnel the profits to a small minority of people who actually understand what's going on.
- BeetleB 8y ago
  >You're better off buying the system up front if possible or even financing it and claiming the tax credit yourself. Up front means no one is responsible for maintenance except you. As for the tax credit, you do get it in the form of a discounted price. Over here, that's how all the solar companies pitch it. They'll install it for cheap, but the condition is that you pay them a big fraction of the tax credit the following 2 years. They make it clear that the reason they're giving you the panels at below market cost is so that you can pay them in tax credits that you file for and receive.
  - imgabe 8y ago
    > Up front means no one is responsible for maintenance except you. Ok? That is standard practice when you own a home. You are responsible for all the maintenance on your home. What is scary about solar panel maintenance? I assume they have to be cleaned every so often. Anything else? Maybe you have an electrician come and retorque the connections once a year? It's not like they have a lot of moving parts assuming it's not doing anything fancy like sun-tracking.
    - throwaway5752 8y ago
      Have you owned a multi-kW inverter before? Because if you know one that is mostly free of drama I would love to know the brand! Solar photovoltaic systems are not as maintenance free as one might wish. They still make a ton of financial sense if you own them outright, but inverters and critter damage to wiring can be unwelcome surprise costs.
throwaway5752 8y ago
FYI, this has nothing to do with solar panels and everything to do with a buying a house that has stuff with transferable contracts. Save up and buy your solar outright, companies don't lease things to you unless there is profit in it.
- annonch 8y ago
  You are paying more but also receive a maintenance service which may or may not save you money and time. Similar to insurance.
- CydeWeys 8y ago
  It has to do with solar panels to the extent that there's very little else that anyone would put on their house that uses a transferable contract. Solar panels are the most common instance in which anyone would run into this situation. I'm struggling to think of anything else, actually.
  - giarc 8y ago
    When we toured our home, the water softener system said rental on it. We inquired and the home owner confirmed the unit was purchased out right. So water softener systems is another potential example.
    - seanalltogether 8y ago
      A water well was the first thing I thought of as a possible transferable lease, I could see septic systems possibly being leased too. Edit- Some houses are also still heated by oil that has to be delivered on a routine basis and I could see that having a lease as well.
      - astura 8y ago
        How do you lease oil delivery? Or do you mean the tank itself? If you have an agreement for an oil company to come fill your oil when it gets low, you just terminate your agreement when you sell your house.
nappy-doo 8y ago
A couple years ago, we purchased and had installed a solar system. In MA, there is an incentive program called SRECs, which is a program where the utilities have to buy MWH of produced electricity, and I can sell my MWH of produced electricity -- that's tracked as an SREC. I can sell SRECs for 10 years, I make about 5-6 a year, and they go for 200-300$. It makes the payoff on the system about 4 years, and ROIC about 17%. If, when I go to sell, the 10 year window on the SRECs haven't finished the buyer and I will have to come to an arrangement for the remaining credits. IMO, solar generally complicates all housing related transactions, but it's worth it.
- ip26 8y ago
  As far as I know, the SREC is a one-time lump sum for the 10 year period, so you're looking at one payment of $1,000-$1,800 right?
  - ecopoesis 8y ago
    SRECs are generated and auctioned quarterly. After an initial lag I get a check for SREC sales every 3 months. There are schemes where you can get fixed price SRECs by signing them over to a 3rd-party. The third-party then give you a fixed amount monthly or quarterly or whatever but it's a significant discount on the auction price. There are also companies that will give you a lump sum for your 10-years of SRECs up front but like all 'need cash now' schemes there is a significant discount.
diafygi 8y ago
Not trying to discredit or de-emphasize the conclusion, but the ironic thing here is that the utility cost escalation rates that Sunrun had initially calculated were likely based off of pre-solar boom tariff increases. As renewables have started becoming competitive (both utility-scale and distributed), utilities have been able to avoid building more expensive fossil-based power plants and transmission lines as quickly and thus rates haven't increased as much as before. So basically the solar industry partially created their own financial situation where the utility costs they are offsetting are lower because of their own participation in the market. Ha. Anyway, I'm glad this in-the-weeds analysis is getting some coverage. As more and more "Distributed Energy Resources" (DERs) are installed in homes ($300 smart thermostats, $1k demand response water heaters, $5k batteries, $10k solar, etc.), people should be aware they need to do utility bill cost analysis earlier in the home buying process. Also, realtors need to get more savvy on utility bill cost impact of all these new DERs so they know how to adjust pricing based on what's installed in a home or building. Disclaimer: I have a software company that many solar companies use to request utility bill history from customers for financial analysis.
- merpnderp 8y ago
  I'm curious how solar could have put a dent in overall power production needs as peek energy usage comes around 6-8pm when solar panels are producing almost no power. And since utilities need to plan their production around peak usage far more than around overall usage, has solar really done that much to lower utility production requirements?
  - dragonwriter 8y ago
    > I'm curious how solar could have put a dent in overall power production needs as peek energy usage comes around 6-8pm when solar panels are producing almost no power. I'm pretty sure the usage peak period is more like noon to six p.m. The grid demand peak is now 6-8 p.m., because of customer-site solar.
  - diafygi 8y ago
    Yes, there is just that much solar being installed. The grid demand curve used to look like a bell curve (peaks mid-day, goes down in the evening). Nowadays, in California there's so much solar that it basically decapitates the curve half way down. Here's today's CAISO demand curve: http://www.caiso.com/TodaysOutlook/Pages/default.aspx http://www.caiso.com/TodaysOutlook/Pages/default.aspx The industry term for this is called the "Duck Curve", where you install so much solar that you mostly reduce daytime electricity demand, but have peaks in the morning and evening. https://en.wikipedia.org/wiki/Duck_curve https://en.wikipedia.org/wiki/Duck_curve
city41 8y ago
We bought a house with TPO panels from SolarCity. It's been ... ok. Our monthly payment never goes up for the life of the lease and SolarCity sends us a check if the panels ever don't produce enough. They provide 100% of our electricity and we generate excess that the power company pays us a tiny amount for. If I could do it again I'd get a house without TPO panels. If for nothing else, just one less variable and thing to consider. You can always get panels later. But I gotta say, SolarCity themselves were an absolute nightmare to work with. The person who got the panel deal on our house (two owners ago), has two other panel deals with SolarCity on two other houses. When we took over the lease SolarCity basically just munged all of the account details together. A major red flag went off when they asked if I'd like to pay my bill with my Wells Fargo account. I don't have a Wells Fargo account. For over a year I had to fight these morons to get everything squared away and to finally get my account onto their online portal so I could pay online. Every single month they tried to either charge me for the other systems, or have the other guy pay for ours, and with each other's bank accounts. They told me to not make any payments until this was resolved, but also told me they'd send me to collections for non-payment. It was an absolute nightmare. Don't ever work with SolarCity.
- toomuchtodo 8y ago
  1. (Edit: In most cases) Never pay for premium PV panels. The 10-20% premium only nets you an additional 1-2% in generation output. 2. Always get at least three quotes, using energysage: https://www.energysage.com https://www.energysage.com 3. As a residential customer, never sign a PPA. Either pay cash or get a loan 4. Tesla solar customer service is wildly inconsistent. Even as a Tesla investor, I do not recommend them for solar. Sorry for your poor Solar City experience.
  - CydeWeys 8y ago
    Premium PV panels can be worth it if they look better. My parents paid a bit extra for black rather than blue solar panels (said panels also have higher output), and the house really does look a lot better for it. This can matter come sale time; curbside appearance is very important in real estate.
zeroonetwothree 8y ago
I bought a house in CA a few years ago and had to assume the previous owner’s SunRun lease. I didn’t really want to but even if it ends up costing me slightly more in the long term (for now it’s unclear) it’s very minor in the land of $1.5 million housing. This article seems to be making a huge deal over a minor $30/month cost.
- netsharc 8y ago
  The article started with something that would cost that much but (as the investigative reporter finds out) is seemingly the tip an iceberg of a fraudulent business.
- sjg007 8y ago
  I think that's the scenario that happens the most often. My guess is that both parties here agreed to transact and then the TPO came out. Still it is not clear why the estate didn't just back out of the sale and then relist with the solar panel TPO disclosed. I guess the house only had one offer?
- michaelt 8y ago
  The article says the payments to buy out the contract totalled $27,300. I wish I had the kind of income that made me call that a 'minor cost' !
  - aidenn0 8y ago
    That's about a third of what the realtors get on a $1.5M sale.
jpeg_hero 8y ago
It’s always seemed so obvious to me: electronics depreciate at a rapid rate, solar panels are electronics, do not finance electronics over 20 years and think it’s going to work. For a 20 year lease, do you really want to be using a 19 year old system stuck on your roof ? Big clunky, weathered with spiderwebs. What does that look like?
- Agathos 8y ago
  I'm very excited to be making the last payment on my 500 MHz Athlon this year!
- throwaway5752 8y ago
  Solar panels are not electronics. Solar panels usually are warrantied to at least 80% of nameplace capacity out to 25 years. And there are hard caps on 1) PV efficiency (Shockley–Queisser) 2) insolation that are non-negotiable physics. If that system is clean and reasonably maintained, it will be 80% as good as they day you bought it (and probably 80% as good as a brand new system) in a quarter of a century.
  - jpeg_hero 8y ago
    True, you’ll still have your 80% but that will be compared to the state of the art at the time as a trade off. The production of contemporary panels should (hopefully) be much much better. Imagine the advances in the next 2 decades: higher efficiency, lighter weight, more module, standards we can’t conceive of. Like the other poster in this thread said: sure your Athlon 500mhz is still runninnfine, even at 80% efficiency
    - cf498 8y ago
      So you also assume an exponential increase in solar panel efficiency ? Or in your energy consumption? Its a rather simple calculation, where do you think the cost of energy will be in 20 years and how will the amount of energy you consume develop in that time.
    - throwaway5752 8y ago
mcguire 8y ago
"...or to prepay the lease and leave the hardware on the roof for the next owner to use. I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000 and allowed us to support solar and get “free” electricity, even as Sunrun remained responsible for maintenance and repairs." Wouldn't the author have been able to take the price of buying out the lease off their taxes?
- toomuchtodo 8y ago
  No. The federal tax credit was already realized by Sunrun, with the savings passed along as part of the lease payments. No different then buying out a lease on an EV, where the federal tax credit was realized by the leasing company; no tax benefit. In scenarios like this, the seller eats the remaining lease cost when the property is sold (think of it as a reduction in sales price).
- jccalhoun 8y ago
  I didn't really understand this part either.
shados 8y ago
Reading the article, the problem is that they used one of those companies with annoying business models to finance the solar panels somehow and you get some, but not all, of the benefits. People in the community I live in are pushing those models pretty hard. Running the numbers, if you are privileged enough to have the money to just buy the damn panels and get them installed outright, you're way, way better off. I don't know if there's still good tax credits, but when I looked, they got you a good chunk of change right there. After that, solar panels pay for themselves in a pretty short amount of time if your electricity usage is high enough to take full advantage of them (eg: if you have a central hvac system or something), or have someone who will buy the surplus from you. In my building, our power usage is way higher than we can get even if we covered the entire roof with panels, so it's pretty easy: put panels, reduce electricity cost, make up the money in a couple of years, don't deal with any third party aside for the installation.
xbmcuser 8y ago
At end of the day all this is US taxation system at work which does all it can to help corporations and screw individuals.
geggam 8y ago
My view on solar is if you want to do it go completely off grid. Use small wind turbines lots of solar panels a Tesla power wall and have a backup generator Problem with this is its not cheap. Not to mention many localities want to make this option simply illegal.
CydeWeys 8y ago
My parents have a large solar installation on their roof that they own outright. They paid for it cash, but if they hadn't had that much available, then a HELOC would have sufficed and not produced any of this kind of drama at sale time. Don't lease anything on your house; it's a huge hassle. Get a loan/HELOC for it if necessary and the numbers work out, but don't enter into a long leasing agreement that can cause transferral problems down the road.
- astura 8y ago
  Not all leases are terrible, though most probably are. I have a leased propane tank, it's not a hassle or anything, I don't pay anything to lease it, I just pay the company for the propane when it need filling. It only needs filling like every 3-4 years because it's only used for the stove. I'm not really sure why its leased, but it could probably be replaced easily if need be. I think the people these sorts of things appeal to are the people who have poor credit and/or very little equity in their house.
JadeNB 8y ago
I know we change titles to avoid click-baitiness, but surely "What happened when I bought a house with solar panels" is not so sensational as to require truncating to "I bought a house with solar panels"?
throwaway5752 8y ago
I don't know enough about Sunrun or the author here, but I will say that - as a general principle - when you see a human interest piece about a multi-billion dollar company with close to 15% of their shares sold short (https://finance.yahoo.com/quote/RUN/key-statistics https://finance.yahoo.com/quote/RUN/key-statistics) then I would take it with a grain of salt and question what is being presented. edit: and you have to get more than halfway through to see the author managed to take the path of maximal pain: "Sunrun calls our insistence that Jug’s trust buy out and remove the system “incredibly unique and rare.” It’s far more common for home sellers to transfer the lease to the buyer—Sunrun says 94 percent of customers do this—or to prepay the lease and leave the hardware on the roof for the next owner to use. I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000 and allowed us to support solar and get “free” electricity, even as Sunrun remained responsible for maintenance and repairs." edit 2: "On consumer review sites and in local news reports, rueful customers warn others to stay away from TPO solar offered by Sunrun and other companies" - is that true of everything, and none cited? What if this was an article about car dealership? edit 3: Having finished the article (and having never heard of Sunrun prior to this) it has the feel of a hit-piece. I don't think it is necessarily (author seems to have a solid investigative journalism track record), but it cherry picks very small sets of data without context and it frames things in what seems like a maximally negative way. Not sure if their experience with their specific bad experience and Bloomberg's comp based on moving markets had anything to do with it.
rconti 8y ago
That buyout price is insane. It's more than we paid outright to have the same number of panels installed in the bay area.
jccalhoun 8y ago
Maybe it is because it is getting near lunch time but this article seemed really rambling and disjointed. Is it about Sunrun or is it about the industry? Or is it just the author's experience? It seems to be all three cut and pasted together haphazardly.
sigzero 8y ago
What happened to the ones Tesla was coming out with?
- rficcaglia 8y ago
  They recently (Dec) sent emails that they are scheduling appointments to those who signed up on the list. Says only one of the several tile options available though.
  - jrnichols 8y ago
    I had such high hopes for the Dow Solar shingles. Maybe the Tesla ones will work out better.
mrdoops 8y ago
It's not strictly a per-company problem. The incentives are for per-watt i.e. bigger system = bigger commission for the company instead of maximizing customer savings with Solar. The incentives don't align customers, sales, utilities, and financial providers. Authority (City, Utility, etc.) typically push and constrain the installation at least 3-6 weeks and they rarely actually know Solar well enough to be a real 'Authority'. Lots of poorly implemented review procedures from untrained city officials and inspectors. Many unnecessary revisions, nitpicks, and expensive truck rolls surface here. Then we also have Sales and Financing Providers who have the most leverage out of the stakeholders. High leverage also means they tend to get the biggest cut for a given Solar contract. High commissions and high fees or they leave the installation company who has to fulfill a 2-6 month-payout-delay pipeline. The fulfillment team also has the most people to retain, train, and coordinate over what is typically a multi-state field operation problem. Not at all easy. Still, it boils my blood seeing some of these organizations fall prey to these pressures and turn to customer exploitation. What it amounts to is some deep-rooted systemic issues with the government-enforced monopolies of our utility companies, overly-simplistic incentives, and a market moving faster than the training and organizational development.
CydeWeys 8y ago
It's sad that the resolution of the contractual dispute involved removing the solar panels. That's a lose-lose for everyone -- the company because they have to spend additional labor, the new owner because they would've preferred them to stay at a reasonable price, and of course the environment. It's too bad the company couldn't come to terms somehow; surely accepting less money in a buy-out offer would have been better for them than having to come out and collect all of their equipment?
fouc 8y ago
It was news to me that California actually voted in a law requiring all new houses built after Jan 1, 2020 to have solar panels.
tomc1985 8y ago
The savings that Sunrun advertises seem rather... meager. $2000 over 20 years?
josefresco 8y ago
This reminded me of a casual conversation with an acquaintance about how they sold their home, with (older) solar panels and had some sort of agreement where they still got paid for the money generated by the panels. It sounded odd, as in; who would buy a house where something on the roof was generating income for the previous owner? - Wouldn't you (the buyer) just buy them out? No idea how this was structured - anyone have any background?
- brandon272 8y ago
  Sounds like either an agreement with the new owner that involved a price reduction on the home in exchange for the continued income. Or something totally shady!
figital 8y ago
I'd rather give excess power to my neighbors for free or just waste it on a giant spinning pinwheel than "sell" it back to the power company. No mention of local battery storage by the reporter or the "reported/reportee".
- frankus 8y ago
  Local battery storage is nice in a power outage, but right now it isn't remotely competitive with net metering. I pay US$7.94 a month to my utility to "store" megawatt-hours of electricity over the course of a year. Brand-name home battery storage is still well over $500 per kilowatt-hour installed. So yeah, I'll engage in shameless commerce with the evil corporate utility if they'll loan me a $2.5-million-dollar "battery" for less than 8 bucks a month.
- dsfyu404ed 8y ago
  If your power bill is not expensive enough for your taste learn to weld. Make sure you go gas-less, plasma and carbon arc for cutting, stick and flux core for welding. If that's still not enough start casting things. These hobbies also have the side effect of being great for one-upping your coworkers who do 3d printing.
SeanFerree 8y ago
Good article!
dev_dull 8y ago
This is almost entirely for people with solar leases, and not solar loans or paid-off panels. For panels that are paid off it's a great deal to pay a little more for the house. It just becomes a tax-deductible loan even though it saves you money each month.
AnonymousRider 8y ago
Do you also crave acknowledgement for your Prius, too?
gameswithgo 8y ago
I suppose if we ever sell our house we will need to remember to advertise that the solar panels are totally paid for.
georgeecollins 8y ago
An important take away from this article is simply the perils of home buying. People usually only do it once or twice in their life (I have done it twice so far) and it's really easy to make a very expensive mistake. Imagine this article with another property problem instead of Sun Run: a mother-in-law unit with a tenant, a disputed property line, a requirement to retrofit the house to make it earthquake proof, illegal additions to the house.. etc. All those things can be pitfalls in a house purchase that a buyer will not know much about. The realtor sounds extremely negligent to not correctly inform the buyer about the true situation until after offer is made. That should be a flag. Realtors understand loss aversion and that you can get very fixated on a particular house. Better to get you to start thinking the house will be yours then break the bad news to you. People just don't buy houses often enough, and they get too emotionally attached, to make rational decisions. Listen to the author talk about how this is the place where he might raise a child. That sounds so portentous, but really wherever you live is where you might raise a child. Owning a house can be great, but the best way to do it is to think about it like buying a used car. Realize the people you are working with are nicer, smarter used car salesmen. Check everything out with true third parties and be ready to back out.
- fbonetti 8y ago
  > An important take away from this article is simply the perils of home buying ... it's really easy to make a very expensive mistake. This article was interesting but I don't think the author was at any risk of making a financial mistake. At the end of the day, Sunrun had a lien on the property. The title company and the lender would not allow the sale to go through unless the Jug estate was able to deliver a clear title. If the title company somehow missed the fact that Sunrun had a lien on the property, the author's title insurance would cover the damages. > Check everything out with true third parties and be ready to back out. The insurance company, title company, lender, and home inspector are already highly incentivized to ensure that the property isn't a dud.
  - georgeecollins 8y ago
    You are right. He made an arrangement to have the seller remove the equipment that SunRun itself said was rare. People don't often accept surprise problems in homes with less negotiation. Don't do that.
filesystemdude 8y ago
I evaluated solar cells for my home, and ultimately decided against because I probably get more total energy saving from the current passive solar of having huge south-facing windows and an oak tree in front of my house - free heat in the winter, shaded in the summer. For solar electric to work, the oak tree would have to go. That said, central issue mentioned in this article aside (which is legit concerning), cost wasn't really an issue I spent much time worrying about. Am I the only person more interested in giving the middle finger to my corrupt utility provider and their coal-centered power generation strategy than whether I came out a few bucks ahead or behind in 20 years? I suspect a lot of people who install solar have similar motivations. But that in itself can be a problem, too. The thing that concerns me about household solar is that it's a bit like owning a Prius - it becomes a status symbol for people more interested in _appearing_ green and assuaging their guilt than actual concern about their total carbon footprint. Take a vacation to Hawaii once a year and you'll probably knock off every single bit of good you did for the planet.
gwbas1c 8y ago
I just built a house with solar panels. I had a bit of trouble with the bank, because the appraiser refused include the panels when appraising the home. Ultimately, my state offered better financing than a traditional mortgage. I just wonder what's going to happen if I ask a buyer in 5, 10, or 20 years to pay for the panels. They clearly reduce the home's energy consumption, and thus have a clear demonstrated value.
joshe 8y ago
The tax credit thing as designed by legislation is nutty. It lets companies buy your tax credit and use it to offset their own income. Leading to all this zero value financial engineering. But from a homeowner's point of view and Sunrun's point of view it makes sense. Lots of people might not be able use the tax credit because they already owe have low income tax (moderate income + mortgage interest deduction, or retired with a nice nest egg will get you to very low income tax). (If you pay enough income tax to use the credit you should just get a loan and avoid this.) This was legislated poorly, probably in order to call it a "tax credit" instead of "subsidy". A subsidy would be much cleaner, have the same economics and they should just do it that way. This whole mess and industry was created just for this one talking point. The government giving you $2000 off an installation is the same as getting a $2000 tax credit from the Treasury's point of view. Sunrun sounds like not the best business to be involved with. Like "new buyer doesn't want the system" is an obvious thing for the customer service manual. (Referring to "...prepay the lease and leave the hardware ... I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000"). Also they are clearly selling this to a bunch of people who could easily use the tax credit and could easily get a homeowner's loan. Super dodgy. I'll bet a lot of the sales nonsense is to hide this fact.
jawns 8y ago
Here's a cautionary tale of purchasing a home with solar panels, even if they're not leased from a third party. We bought a house with solar panels in 2016. The seller had purchased the system less than a year before the house went on the market, and one of the key selling points was that there was no lease to deal with; by purchasing the home, we would 100% own the solar panels and would reap all the benefits of what they generated. Six months after the sale was finalized, we changed Internet providers and soon after that, we were forwarded an email by the seller from an organization we had never heard of, asking us to reconnect the solar panels to the Internet as a condition of their contract. Um ... what contract? It turns out that when the seller purchased the panels, they made a deal with this green-energy company, which was sort of a joint venture between our state's biggest utility and the state itself. The organization paid the seller $6K up front. The seller, in turn, agreed that for the next 20 years, any Solar Renewable Energy Credits generated by the panels would belong to the organization. The existence of this contract, which included a lien on the SRECS, was never disclosed to us. And it never showed up on the title search because the lien was on this abstract credit, not on any physical property. The lawyer who did the closing had never heard of anything like it! We ended up having to get a different lawyer involved, and it was a big production, because not only had the organization dealt with relatively few transfers of ownership, it had never dealt with a case where the SRECS contract was not transferred as part of the home sale, and undoing the mess the seller had caused by not disclosing it took a lot of legal legwork. In the end, the organization agreed to remove the lien, rather than continue a legal battle, and I assume it then went after the seller for whatever portion of the $6K advance payment it could recoup. The lesson I learned from all of this is that when it comes to solar panels, not even the people in the industry have much experience with the edge cases. And although installations are starting to become routine, transfers of ownership are not yet routine. (By the way, the solar panels work well, and our energy bills are very low, but I wish someone would have told me that squirrels love to build nests under the panels and chew through wires, because yeah, that's happened, and it's not covered under the warranty.)
- protomyth 8y ago
  Squirrels and mice are a pain for electrical wire. That's why its important to get them the heck out of your garage. Its never fun to have a car need repairs because the damn things chewed through a cable. Had to replace a friends spark plug wires on his car because he thought the critters were cute.
rebuilder 8y ago
The article says Sunrun's shares rose when California decided to mandate solar panels on new constructions starting 2020. This doesn't really make sense to me. The reason stated was that developers don't like to install solar because it inflates the sticker price, but if you're taking out a mortgage, then you're probably looking at a payback timeline similar to the 20 year lease Sunrun offers. I don't really see how it makes sense not to take on the 5-10% (depending on installation size and house price of course) extra mortgage for what should be a cheaper overall cost over a similar timespan.
- linuxftw 8y ago
  People don't buy houses, they buy payments. Specifically, whatever their lender will give them. Any additional principal balance is more they have to qualify for and more money required for down payment. If you're thinking "Wow, that's nuts that people would spend 100% of what a lender will qualify them for," then, I say to you "Welcome to America."
b1r6 8y ago
Why would anyone do this? You should either save up and buy PV infrastructure outright, or not have it at all. Being tied to some sketchy company via contract sounds horrid. I would automatically exclude any homes with this setup from my search.
socrates1998 8y ago
While this company is doing some pretty shady shit, it's actually not worse than what traditional electric companies do. Talk about corruption and dishonest practices. In Florida, FPL, the electric provider for half of Florida, complained for about a decade (from 2004-2014) on how how they needed to keep raising rates so that they could continue to "upgrade the infrastructure" so that they could be prepared for the hurricanes that inevitably would hit the coast. Some estimates that FPL made a few extra billion dollars on the price increases that went beyond normal inflation. What do you think happened when south Florida got hit with the next major hurricane in 2014? Yup. same outages that we saw in 2004. And the hurricanes weren't even worse. 10 years and billions of dollars in "upgrades" resulted in the same exact problems. FPL took our money and didn't do anything with it. AND they have been vehemently against people owning solar panels, even going as far as blocking legislation that would allow people to install them on their own homes without special permission from "FPL approved" companies. And you can guess how many "approved" companies they would actually approve. I have yet to see any major utility company operate with any decency, so while this solar panel company is doing some shady shit with their salespeople and leasing terms, it at least didn't scam millions of people for billions of dollars like FPL. Florida should have the cleanest electricity in the world. Sunshine almost every day, but we don't have it because: A) We don't price in the environmental impact of non-solar producing coal and natural gas plants, thus keeping solar "more expensive" than fossil fuel electricity. B) FPL actively blocks the widespread adoption of solar panels on people's homes. C) Politicians are happy to take money from FPL and other interest groups that don't want to adopt solar.
01100011 8y ago
A friend was a salesman for SunRun back in 2011 and at the time I was growing pot so I was looking to reduce my energy costs. I got an 8.8kW system(a bit large for my house). I spent probably $1k/year extra for electricity during the first year. Over time, the system started to actually save me money, but it took about 5 years. I also had a bunch of power I was obligated to buy, so I lost the incentive to conserve and ran my central A/C nearly all the time. When I had to sell my house after a divorce, I realized what a pain in the ass it would be. I had to convince the buyer that it was a good idea to assume the lease. I found out things like the requirement to pay thousands to remove the system if the roof needed replacement(one SunRun rep, not my friend, hinted during sign-up that they maintained the roof). The system only saved money if you consumed a lot of electricity. If you didn't need the power, you're stuck paying for it anyway. Fortunately the buyer went for it and I escaped the lease. Another annoyance was the inverter box that SunRun installed right outside my bedroom. Every morning and night, the system would turn on and off several times as the light levels were close to the threshold. This meant some rather large relays were clicking repeatedly, waking me up at dawn a lot of the time. On the plus side, I got a new breaker panel and had my service rating upgraded from 100A to 150A. If I had to sum it up, I'd say that SunRun isn't absolutely evil, but if I ever do it again I would buy the system outright, assuming it was economically viable. My personal opinion is that residential solar is a misallocation of resources as long as there are commercial rooftops without solar.
zmix 8y ago
> "amplify the pain significantly" Wow, this is violence! With such extremisms being legit, one must not be surprised, if extremism rises on all fronts! Who likes business (wo)men?
ananonymoususer 8y ago
I'm closing on a new house tomorrow. The builder has a business arrangement with Sunstreet Solar and they have a ~4KW plant on the roof. While researching the details of the sale, I discovered that Sunstreet owns the panels and has an easement. They get 80% of the generated power and give me 20%. This did not seem like a good deal to me. I negotiated the purchase of the system from Sunstreet as part of the sale, and I got the home builder to reduce the price. This way I can claim the federal tax credit, and I get 100% of the generated power instead of 20%.
aj7 8y ago
I spent considerable time evaluating solar installation, in of all places, Tucson. The perfect place, right? I viewed it as replacing a fixed income investment. (1) The internal rate of return was 1% (2) It was obvious that any government subsidy was swallowed up by price increases. This was very sobering to a leftist like me. (3) Grid connection and resell are critical, but there is no way to guarantee the terms of this into the future. After all that, my wife’s intuition was still crucial in nixing the panels.
rhacker 8y ago
DIY array with 17 panels should cost $5000 today with inverters and grid tie - thought I would forgo the grid tie and just get a shit fuck ton of lead acids (probably 30 for another $3000) and have energy for at least a day. Stop paying these racket companies and their dumbass contracts. The DIY is totally easy.
- lightedman 8y ago
  You're way overestimating. I see a 6kWh system (that's 24-ish panels) with inverters for $3500. New runs about $5K from the company I produce panels for. 30 good SLAs, that's a bulk quantity buy and you can get them for about $30 each at that quantity, so $900.
codingdave 8y ago
The fact that this is about solar is diminishing the actual lessons here - don't sign contracts that are tied to your home's title. And if you find a home you love that has a contract on its title, just walk away before getting attached.
briandear 8y ago
Saving $24 a month with solar panels seems hardly worth the effort. Why not just build nuclear plants and dispense with the tedium of house installed solar? Dealing with solar panels seems like such a such a pain.
peter303 8y ago
I get 3rd party solar sales calls nearly every day. I cut to the point and tell them my all-LED house plus new refrigerator averages 85 kwh month. That stops them cold because they require 1000 kwh to make a profit. Maybe if I got an EV I could crank up the usage a good deal. I still dont know why they have called me several hundred times.
sabujp 8y ago
is there any company that hasn't gotten big by lying, cheating, overpromising, stealing a dollar here and there, etc?
sabujp 8y ago
i think the next time the costco sunrun person tries to say hello to me, I'm going to ask him how well he's been doing amplifying the pain
cjhopman 8y ago
> If Southern California Edison's residential rates continue to rise annually by 2.2 percent, as they have on average over the last decade, Jug's total electricity outlay having gone solar would have cost about $6,000 more over 20 years. Isn't the math that came to that conclusion completely fucked up? $115(1.022 ^ 20) = $177 $75(1.029 ^ 20) + $17 * (1.022 ^ 20) = $159 In fact, I'm about 100% sure that that $6000 figure is the amount of additional money that is payed to sunrun due to the increase costs (difference between $75/month for 20 years and the cost with 2.9% increase). It looks like the journalist then went and misinterpreted that data and made up a completely fake chart below it to fit their interpretation of the data. In that chart, clearly the socal edison side should start with a higher cost than the sunrun side and the socal edison cost at 20 years should actually be above the $2k line.
- cjhopman 8y ago
  Okay... way at the end of the article they say that $115 isn't the real amount he was paying, he was only really paying $79. Making that change gets a lot closer to their -6000/+4000 for 2.2%/4.75% electricity increases.
wkearney99 8y ago
Ugh, I do wish there were more neutral sources to learn more about residential solar. Everything seems like such a con. I've got plenty of roof and reasonable capital to purchase gear but nowhere near the time to ferret out what's legit, what's a pie-eyed-pile-of-crap and what's an outright scam.
misterpoopoo 8y ago
There’s a couple things wrong with this article and I have a decent understanding of why Jug (RIP) did what he did. (I worked at Sunrun and created this fake account to hide identity; I worked in finance). Not to bash the sales reps or trainers, but they are so far removed from the financing of the product they don’t know what’s going on. First, at the end the sales rep who provided the #s is bullshit. The sales reps are notorious for inputting whatever #s they want into the internal SFDC system so the average monthly bill isn’t accurate. This isn’t an exception, it’s their own rule to accelerate sales (management does not tell them to do this. To be specific) The 2.9% escalator is an aggressive and risky product, but requires zero upfront and an incredibly low initial $/kWh. He more than likely was saving money and would have been for at least several years. I don’t know his intentions but you can read between the lines and I don’t want to talk about the dead. Also, I forget if Conedison does tier pricing, but if it did with all his gadgets, his bill would have been through the roof. Lastly, Sunrun does offer cash/loan/0%/1.9%/prepaid products, and if I were to go for a cash deal, I would use Sunrun/Vivint/SolarCity because it’s a huge headache to coordinate with developers and file all the correct paperwork.

416 points by sphuff 8y ago

> Hugh Bromley, a solar analyst at BloombergNEF, says Sunrun and its competitors offer solar, sure, but can be better understood as having created “one of the most sophisticated financial engineering industries of any sector of the U.S. economy.” While this is just a prejudice and their financial engineering _may_ be totally sound, this makes me think of CDOs and the mortgage crisis and all that. The fact that the deal may not actually be all that good for the consumer -- and may complicate sales of their house since it's effectively a lien forcing future buyers to take a deal which may be _more apparent as bad_ in the future -- only makes me again think of the financial hijinx that led to the mortgage bubble/crisis.

sjjshvuiajhz 8y ago
While this may remind some people of the mortgage bubble, solar is nowhere near as important to the economy as home prices are. The potential to take down the economy isn’t there, the numbers are too small.

CompelTechnic 8y ago

>Supporting renewable energy is important, and I get spending a little more to help the planet. But a for-profit company like Sunrun wasn’t my idea of the right place to do it. That's a pretty strange sentiment. 20 years ago, solar was decidedly more expensive than it is now. A fair price would be higher than grid power. For the installation to have occurred at all, the up front capital cost had to be amortized by a for-profit company in an attractive way. This appears to have been crafted as a payment schedule that's slightly back-heavy. Seems to me that the author just didn't want to be left holding the bag, but still wanted to pay lip service and feel like a good environmentalist.

deleted 8y ago
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daveFNbuck 8y ago
The article is about a solar installation done in 2016.
- CompelTechnic 8y ago
  Ah, sorry. Yeah, I must have misremembered "20 years" from the first quote below. Doesn't materially change my argument, I think. Another important point, in my opinion, is the cost given in the second quote below is a fair cost. $6000 over 20 years is an average cost of $300 per year. If you are purchasing 2016-era installed solar, knowing that it is a less cost-effective form of electricity generation than conventional means, an amortized (predicted) cost of $300 per year is fair. Refusing to pay this and still claiming to "be willing to pay a little extra to help the planet" is hypocritical. >I got ahold of a copy of Jug’s contract, and quickly saw how Sunrun could afford to extend such an offer. It lasted 20 years. The payments escalated annually by 2.9 percent—they’d be 72 percent higher by 2036. The tax credit was worth at least $5,000. >If Southern California Edison's residential rates continue to rise annually by 2.2 percent, as they have on average over the last decade, Jug's total electricity outlay having gone solar would have cost about $6,000 more over 20 years.
  - daveFNbuck 8y ago
    You're mixing up two different sets of numbers here. $6,000 is the extra amount that Jug would have paid after being sold the solar installation as a way to save a lot of money over the next 20 years. The author, who was willing to pay a little more to save the environment, would have been paying an extra $30/month from the start, before the annual increases started widening the gap. Their bills without the solar started at $30/month, so this would start out doubling their bill and increase from there.
matthewdgreen 8y ago
Seems like one thing to make the payment schedule back-heavy and be honest about it, another thing to use unrealistic assumptions about utility price increases to disguise this payment schedule as a lifetime cost savings.
- ocdtrekkie 8y ago
  And the huge issue is that if it's a back-heavy payment scheme: A future buyer will only see the heavier portion. Which makes your house less attractive to a buyer, and devalues your home, which also hurts any potential cost savings.
  - CompelTechnic 8y ago
    The growth rate of the payment is 2.9%. This is only very slightly higher than inflation, on average. Also, assuming that the lower home value came true, the original purchaser of the solar installation did put his money where his mouth is, and paid a financial cost to his environmental interests, which is the moral thing to do, regardless of whether he was "tricked" by the negative cash flows showing up in later years (and in this case, when he was dead). I guess my main point from my multiple posts is that there is no free lunch. If the fully amortized cost of solar is higher than grid power, someone will have to pay. Someone with buyer's remorse, who fully understood the cash flow implications at the time of purchase, can still feel like they were tricked. And maybe, the pessimistic projections of grid power costs made by sunrun should be taken with a grain of salt, and it should also be acknowledged that this deceptive practice is helping the planet. Maybe a game theory perspective is valuable here- assuming cooperation is possible, people place an irrationally small cost to global warming, and discount future costs (in this case, of their power bill) to an irrationally large degree. The way to get people to cooperate is to trade one irrational impulse for another.
    - ocdtrekkie 8y ago
      Sure, someone is going to have to pay for greener power. But the problem is that Sunrun is claiming it's cheaper, even though it isn't, and that the owner ends up paying both Sunrun's expenses and their profit margin.
gwbas1c 8y ago
Owning your panels with a loan is an excellent investment. Leasing them isn't.
barkingcat 8y ago
This seems really suspicious to me since in the article they clearly stated that their electricity usage was much lower than the previous owner, who was running some kind of server farm there. Of course someone needed to pay, but it seems wrong to pay extra for electricity they are not using to pay lip service for supporting a for-profit company who had locked in the plan with an earlier contract.

kryogen1c 8y ago

>Accounting for all these things, taking on Jug’s lease would translate to us paying at least $30 a month more. We’d lose money from Day 1 I'm unsure how I feel about this. $30 is a significant % of the electric bill, but is a very small % of the cost of owning a home. Didn't solar start as economically viable due to heavy government tax incentives? I'm ignorant of the data, but I thought solar was not fit for public deployment has only edge use cases.

zdragnar 8y ago
Take that $30, stick it in a savings or investment. When solar prices go down, or utility prices go up, take the money you've saved up and then put it towards the purchase. There's no point in throwing away money on a losing proposition, since in this case the homeowner wouldn't be the one to get the credit. As an additional bonus, your home will have newer, more efficient panels with a longer remaining estimated lifetime, so if you do end selling the house they'll add more value. A solar install in a reasonably sunny climate can pay for itself over its lifespan, but you need to actually stay there the whole time, or hope that the added value to your house makes up for whatever your investment was.

wccrawford 8y ago

>It’s far more common for home sellers to transfer the lease to the buyer—Sunrun says 94 percent of customers do this—or to prepay the lease and leave the hardware on the roof for the next owner to use. I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000 and allowed us to support solar and get “free” electricity, even as Sunrun remained responsible for maintenance and repairs. I'm not surprised Sunrun chose not to tell them about that option as it seems like a losing situation for them. They claim that Sunrun would have been covered, but that merely means they fail to lose money. They stood to make money on that system, and no sane solar panel buyer is going to have heavily used panels put in. >Aided by a local attorney and my father-in-law, a retired contract attorney, I drafted a letter to Jug’s trust accusing the listing agents of failing to deliver title to the property free of any third-party claims as the agents had said they could. I threatened legal action. It was a last-ditch effort that none of us expected to work. Then it did. I'm not surprised this worked. Their whole job is to present the actual situation during the sale and they failed at it. There are probably a lot of legal issues with what they did and I bet the agent was quaking in their boots at the thought of that going to trial.

sthu11182 8y ago
regarding the legal action: based on my recollection from real estate class in law school, failing to provide a free and clear title on a general warranty deed is a pretty straight forward victory. if i remember anything from that class, always get a general warranty deed (ie a deed with all the covenants) when buying a house.
- toomuchtodo 8y ago
  Your class was correct (I just had to go through this very scenario this week, albeit not for solar, with a local title company transferring some property). Never take action that is going to jeopardize free and clear title on your real estate.
- zaroth 8y ago
  I’ve never seen anything but a quitclaim deed offered at closing. The P&S stipulate the deed is clear, but the buyer runs the title search. If you find something (like TPO panels) attached, there’s a “make right” clause which usually has a maximum amount paid of 1% after which the seller can walk away. If you want protection for anything after the sale, you buy owners title insurance.

AlphaWeaver 8y ago

>One former Bay Area employee sent me a Sunrun training manual he said was current when he resigned in April 2017. It’s called “Power Play 2.0: The Guide to Successfully Sell Sunrun.” (The company confirmed its authenticity.) It instructs salespeople to sow distrust in and disdain for traditional utilities and appeal to customers’ emotions. Over 61 pages, pain is cited at least 31 times and fear at least a dozen. When reviewing a customer’s traditional utility bill, the trainee is told, “amplify the pain significantly.” Among “components of success”: “creating pain and fear.” Among the “five fatal flaws” to avoid: “failing to build pain or fear.” Not the company I want to be stuck in a 20-year contract with.

rrauenza 8y ago
We got a quote from sun run - it made us uncomfortable how all of their numbers assumed ridiculous utility rate increases. And our gut said we should just wait and purchase instead. A few years later solar prices came down and we made a purchase with an installer whose main business was purchase, not lease. edit: I responded below, but my complaint isn't with their price -- it's their scare tactics and fuzzy break even financial calculations assuming wild rate increases. We went with a vendor who was more open and honest about the break even calcs.
- macspoofing 8y ago
  To be fair, the cost of solar panels at the time you were considering them was what it was. Someone needed to pay for them. If that someone is Sunrun, they need to recoup those cost and make a return. You can be as creative as you want with the financing, that reality won't change. You could have gotten a bank loan too.
  - CydeWeys 8y ago
    No, someone did not need to pay for them. That's not how the market works. If no one is willing to pay the listed price then the product goes unsold. Sunrun has no right to paying customers at any arbitrary price level, same as any other business.

seiferteric 8y ago

I had a very similar experience when selling my house but with vivint solar. I had panels installed less than a year before and soon found out all these issues. Should have read the contract more thoroughly of course, but I am pretty sure the sales people mislead or even lied to me when I asked them questions about what happens if we move etc. Luckily the buyer agreed to take over the lease. If/when I get panels on my new house, I will almost certainly buy them outright.

xfour 8y ago

Ahh yes Sunrun. We bought a house and our realtor had the foresight to investigate the situation before we closed on the home. We got a letter disclosing the system was owned free and clear. We setup the online tracking portal only to notice that they transferred the account like thousands of dollars in owed monies from the previous owner. After getting a call from the company trying to strongarm us for the debt we essentially told them to kick rocks. They should’ve just demanded that money as part of escrow and now they’re left with a debt in someone else’s name that is never going to be paid and likely a headache for us in the future.

mchannon 8y ago

A few points this person probably didn't think about: •Nobody knows what California electricity prices are going to do in the next 20 years. By terminating the system, they just traded certainty for volatility. With that attitude I hope they financed using an ARM loan. •They whined about how expensive it was, but also expressed a desire to have one or two kids someday. When you have kids, your electric bills tend to go up, and they did their math based on their "expected" usage today. •Santa Barbara has a very mild climate, but I expect in the coming years it will get hotter and muggier much more of the year, and for health reasons they'll have to put a room A/C on. Whoa, now you're using as much juice as Jug did. •PV rooftop panels in California nowadays don't quite "help the planet" to the extent their owners believe they do. The duck curve continues to get worse. •A silent majority of people think PV panels are ugly. Like, hideously ugly. They're afraid to speak out, but not to act out and point the finger at a different reason. The end result of this whole thing reminds me of one of those people 10 years ago who bought a top-end $500 cellphone locked in to a carrier on a 3-year-plan but only $50 a month, let the payments lapse 3 months in, and then tried to sell it on eBay, angry at the cellphone company for financially hobbling them when it wouldn't sell or it got returned.

sjg007 8y ago
You don't need AC at the beach.. Very rarely, maybe 4 days a year during Santa Anas it gets that hot... and then you will probably have evacuated due to wildfires anyway.
- mchannon 8y ago
  And thank you for shopping at your Goleta Home Depot store. I respect what you say, but it'll be $532.78 for that window air conditioner. Cash or charge?
Dylan16807 8y ago
> Nobody knows what California electricity prices are going to do in the next 20 years. That's true but with the way most utility costs have been dropping, the rates are probably not going to skyrocket. > using more power The problem is the rate being too high. More use doesn't help the problem. > duck curve Sure, but not very important to this choice. > A silent majority of people think PV panels are ugly. Like, hideously ugly. Do you have evidence of how common that is? Does that include installations that are well-integrated into the roof? > cell plan A typical cell phone contract breaking fee is $350, with some pro-rating. This roughly covers the cost of a phone discount. They don't try to charge you $1400 for the entire remaining contract term.

MichaelApproved 8y ago

> It appeared that if we bought Jug’s place, we’d have to assume his lease arrangement with Sunrun. The whole article is worth reading but this headache is specifically related to leased panels. Though, leasing makes going solar easier, it is a terrible idea because of issues like these. Also, every local power company has different arrangements for residents. I live in Suffolk county, Long Island, New York. Our power company arrangement is amazing. We get to sell back any excess power at the same rate we buy it from them. Meaning, they act like a free battery. I have a 20 years term that started from the day I installed my panels to use up any excess energy they're holding for me. After that 20 years term is over, they pay me the wholesale rate for any leftover power, which is next to nothing. I don't pay extra fees for net metering but we do have the highest rates in the nation. It's roughly $0.20/kwh, including delivery, taxes and other fees. If I end up having any extra power and Crypto is still a thing, I'd just plug in a miner and drain it all. It'd be a bonus if I did it during winter and use the heat to warm the house. Regarding the purchase, I financed the purchase. Got 0% loan on the expected tax credit portion and 6.5% on the rest for 15 years. Even with the interest rates, I'll be cash-flow positive on the monthly payments. I also essentially locked in my utility costs. My local power company is expected to raise rates 3-5% a year. If I pay my loan off early, I get to avoid those rate increases for the portion of electricity that my panels cover. Anyway, if you're thinking about going solar, check your local utility rules and go for the purchase option. Leases are not worth the baggage they come with.

imgabe 8y ago

When you get down into the meat of how the tax credits and Sunrun's financing work it's astonishing. Essentially it sounds like Sunrun's investors are paying to install solar panels on your house so they can claim the tax credit to offset their own income. Meanwhile you are paying Sunrun for the electricity generated by the solar panels. There doesn't seem to be much benefit for the homeowner. You're better off buying the system up front if possible or even financing it and claiming the tax credit yourself. Then you'd only have to pay the utility for the electricity you don't generate. "The American way" anymore seems to be to take a good idea, overcomplicate it with financial engineering, and funnel the profits to a small minority of people who actually understand what's going on.

BeetleB 8y ago
>You're better off buying the system up front if possible or even financing it and claiming the tax credit yourself. Up front means no one is responsible for maintenance except you. As for the tax credit, you do get it in the form of a discounted price. Over here, that's how all the solar companies pitch it. They'll install it for cheap, but the condition is that you pay them a big fraction of the tax credit the following 2 years. They make it clear that the reason they're giving you the panels at below market cost is so that you can pay them in tax credits that you file for and receive.
- imgabe 8y ago
  > Up front means no one is responsible for maintenance except you. Ok? That is standard practice when you own a home. You are responsible for all the maintenance on your home. What is scary about solar panel maintenance? I assume they have to be cleaned every so often. Anything else? Maybe you have an electrician come and retorque the connections once a year? It's not like they have a lot of moving parts assuming it's not doing anything fancy like sun-tracking.
  - throwaway5752 8y ago
    Have you owned a multi-kW inverter before? Because if you know one that is mostly free of drama I would love to know the brand! Solar photovoltaic systems are not as maintenance free as one might wish. They still make a ton of financial sense if you own them outright, but inverters and critter damage to wiring can be unwelcome surprise costs.

throwaway5752 8y ago

FYI, this has nothing to do with solar panels and everything to do with a buying a house that has stuff with transferable contracts. Save up and buy your solar outright, companies don't lease things to you unless there is profit in it.

annonch 8y ago
You are paying more but also receive a maintenance service which may or may not save you money and time. Similar to insurance.
CydeWeys 8y ago
It has to do with solar panels to the extent that there's very little else that anyone would put on their house that uses a transferable contract. Solar panels are the most common instance in which anyone would run into this situation. I'm struggling to think of anything else, actually.
- giarc 8y ago
  When we toured our home, the water softener system said rental on it. We inquired and the home owner confirmed the unit was purchased out right. So water softener systems is another potential example.
  - seanalltogether 8y ago
    A water well was the first thing I thought of as a possible transferable lease, I could see septic systems possibly being leased too. Edit- Some houses are also still heated by oil that has to be delivered on a routine basis and I could see that having a lease as well.
    - astura 8y ago
      How do you lease oil delivery? Or do you mean the tank itself? If you have an agreement for an oil company to come fill your oil when it gets low, you just terminate your agreement when you sell your house.

nappy-doo 8y ago

A couple years ago, we purchased and had installed a solar system. In MA, there is an incentive program called SRECs, which is a program where the utilities have to buy MWH of produced electricity, and I can sell my MWH of produced electricity -- that's tracked as an SREC. I can sell SRECs for 10 years, I make about 5-6 a year, and they go for 200-300$. It makes the payoff on the system about 4 years, and ROIC about 17%. If, when I go to sell, the 10 year window on the SRECs haven't finished the buyer and I will have to come to an arrangement for the remaining credits. IMO, solar generally complicates all housing related transactions, but it's worth it.

ip26 8y ago
As far as I know, the SREC is a one-time lump sum for the 10 year period, so you're looking at one payment of $1,000-$1,800 right?
- ecopoesis 8y ago
  SRECs are generated and auctioned quarterly. After an initial lag I get a check for SREC sales every 3 months. There are schemes where you can get fixed price SRECs by signing them over to a 3rd-party. The third-party then give you a fixed amount monthly or quarterly or whatever but it's a significant discount on the auction price. There are also companies that will give you a lump sum for your 10-years of SRECs up front but like all 'need cash now' schemes there is a significant discount.

diafygi 8y ago

Not trying to discredit or de-emphasize the conclusion, but the ironic thing here is that the utility cost escalation rates that Sunrun had initially calculated were likely based off of pre-solar boom tariff increases. As renewables have started becoming competitive (both utility-scale and distributed), utilities have been able to avoid building more expensive fossil-based power plants and transmission lines as quickly and thus rates haven't increased as much as before. So basically the solar industry partially created their own financial situation where the utility costs they are offsetting are lower because of their own participation in the market. Ha. Anyway, I'm glad this in-the-weeds analysis is getting some coverage. As more and more "Distributed Energy Resources" (DERs) are installed in homes ($300 smart thermostats, $1k demand response water heaters, $5k batteries, $10k solar, etc.), people should be aware they need to do utility bill cost analysis earlier in the home buying process. Also, realtors need to get more savvy on utility bill cost impact of all these new DERs so they know how to adjust pricing based on what's installed in a home or building. Disclaimer: I have a software company that many solar companies use to request utility bill history from customers for financial analysis.

merpnderp 8y ago
I'm curious how solar could have put a dent in overall power production needs as peek energy usage comes around 6-8pm when solar panels are producing almost no power. And since utilities need to plan their production around peak usage far more than around overall usage, has solar really done that much to lower utility production requirements?
- dragonwriter 8y ago
  > I'm curious how solar could have put a dent in overall power production needs as peek energy usage comes around 6-8pm when solar panels are producing almost no power. I'm pretty sure the usage peak period is more like noon to six p.m. The grid demand peak is now 6-8 p.m., because of customer-site solar.
- diafygi 8y ago
  Yes, there is just that much solar being installed. The grid demand curve used to look like a bell curve (peaks mid-day, goes down in the evening). Nowadays, in California there's so much solar that it basically decapitates the curve half way down. Here's today's CAISO demand curve: http://www.caiso.com/TodaysOutlook/Pages/default.aspx http://www.caiso.com/TodaysOutlook/Pages/default.aspx The industry term for this is called the "Duck Curve", where you install so much solar that you mostly reduce daytime electricity demand, but have peaks in the morning and evening. https://en.wikipedia.org/wiki/Duck_curve https://en.wikipedia.org/wiki/Duck_curve

city41 8y ago

We bought a house with TPO panels from SolarCity. It's been ... ok. Our monthly payment never goes up for the life of the lease and SolarCity sends us a check if the panels ever don't produce enough. They provide 100% of our electricity and we generate excess that the power company pays us a tiny amount for. If I could do it again I'd get a house without TPO panels. If for nothing else, just one less variable and thing to consider. You can always get panels later. But I gotta say, SolarCity themselves were an absolute nightmare to work with. The person who got the panel deal on our house (two owners ago), has two other panel deals with SolarCity on two other houses. When we took over the lease SolarCity basically just munged all of the account details together. A major red flag went off when they asked if I'd like to pay my bill with my Wells Fargo account. I don't have a Wells Fargo account. For over a year I had to fight these morons to get everything squared away and to finally get my account onto their online portal so I could pay online. Every single month they tried to either charge me for the other systems, or have the other guy pay for ours, and with each other's bank accounts. They told me to not make any payments until this was resolved, but also told me they'd send me to collections for non-payment. It was an absolute nightmare. Don't ever work with SolarCity.

toomuchtodo 8y ago
1. (Edit: In most cases) Never pay for premium PV panels. The 10-20% premium only nets you an additional 1-2% in generation output. 2. Always get at least three quotes, using energysage: https://www.energysage.com https://www.energysage.com 3. As a residential customer, never sign a PPA. Either pay cash or get a loan 4. Tesla solar customer service is wildly inconsistent. Even as a Tesla investor, I do not recommend them for solar. Sorry for your poor Solar City experience.
- CydeWeys 8y ago
  Premium PV panels can be worth it if they look better. My parents paid a bit extra for black rather than blue solar panels (said panels also have higher output), and the house really does look a lot better for it. This can matter come sale time; curbside appearance is very important in real estate.

zeroonetwothree 8y ago

I bought a house in CA a few years ago and had to assume the previous owner’s SunRun lease. I didn’t really want to but even if it ends up costing me slightly more in the long term (for now it’s unclear) it’s very minor in the land of $1.5 million housing. This article seems to be making a huge deal over a minor $30/month cost.

netsharc 8y ago
The article started with something that would cost that much but (as the investigative reporter finds out) is seemingly the tip an iceberg of a fraudulent business.
sjg007 8y ago
I think that's the scenario that happens the most often. My guess is that both parties here agreed to transact and then the TPO came out. Still it is not clear why the estate didn't just back out of the sale and then relist with the solar panel TPO disclosed. I guess the house only had one offer?
michaelt 8y ago
The article says the payments to buy out the contract totalled $27,300. I wish I had the kind of income that made me call that a 'minor cost' !
- aidenn0 8y ago
  That's about a third of what the realtors get on a $1.5M sale.

jpeg_hero 8y ago

It’s always seemed so obvious to me: electronics depreciate at a rapid rate, solar panels are electronics, do not finance electronics over 20 years and think it’s going to work. For a 20 year lease, do you really want to be using a 19 year old system stuck on your roof ? Big clunky, weathered with spiderwebs. What does that look like?

Agathos 8y ago
I'm very excited to be making the last payment on my 500 MHz Athlon this year!
throwaway5752 8y ago
Solar panels are not electronics. Solar panels usually are warrantied to at least 80% of nameplace capacity out to 25 years. And there are hard caps on 1) PV efficiency (Shockley–Queisser) 2) insolation that are non-negotiable physics. If that system is clean and reasonably maintained, it will be 80% as good as they day you bought it (and probably 80% as good as a brand new system) in a quarter of a century.
- jpeg_hero 8y ago
  True, you’ll still have your 80% but that will be compared to the state of the art at the time as a trade off. The production of contemporary panels should (hopefully) be much much better. Imagine the advances in the next 2 decades: higher efficiency, lighter weight, more module, standards we can’t conceive of. Like the other poster in this thread said: sure your Athlon 500mhz is still runninnfine, even at 80% efficiency
  - cf498 8y ago
    So you also assume an exponential increase in solar panel efficiency ? Or in your energy consumption? Its a rather simple calculation, where do you think the cost of energy will be in 20 years and how will the amount of energy you consume develop in that time.
  - throwaway5752 8y ago

mcguire 8y ago

"...or to prepay the lease and leave the hardware on the roof for the next owner to use. I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000 and allowed us to support solar and get “free” electricity, even as Sunrun remained responsible for maintenance and repairs." Wouldn't the author have been able to take the price of buying out the lease off their taxes?

toomuchtodo 8y ago
No. The federal tax credit was already realized by Sunrun, with the savings passed along as part of the lease payments. No different then buying out a lease on an EV, where the federal tax credit was realized by the leasing company; no tax benefit. In scenarios like this, the seller eats the remaining lease cost when the property is sold (think of it as a reduction in sales price).
jccalhoun 8y ago
I didn't really understand this part either.

shados 8y ago

Reading the article, the problem is that they used one of those companies with annoying business models to finance the solar panels somehow and you get some, but not all, of the benefits. People in the community I live in are pushing those models pretty hard. Running the numbers, if you are privileged enough to have the money to just buy the damn panels and get them installed outright, you're way, way better off. I don't know if there's still good tax credits, but when I looked, they got you a good chunk of change right there. After that, solar panels pay for themselves in a pretty short amount of time if your electricity usage is high enough to take full advantage of them (eg: if you have a central hvac system or something), or have someone who will buy the surplus from you. In my building, our power usage is way higher than we can get even if we covered the entire roof with panels, so it's pretty easy: put panels, reduce electricity cost, make up the money in a couple of years, don't deal with any third party aside for the installation.

xbmcuser 8y ago

At end of the day all this is US taxation system at work which does all it can to help corporations and screw individuals.

geggam 8y ago

My view on solar is if you want to do it go completely off grid. Use small wind turbines lots of solar panels a Tesla power wall and have a backup generator Problem with this is its not cheap. Not to mention many localities want to make this option simply illegal.

CydeWeys 8y ago

My parents have a large solar installation on their roof that they own outright. They paid for it cash, but if they hadn't had that much available, then a HELOC would have sufficed and not produced any of this kind of drama at sale time. Don't lease anything on your house; it's a huge hassle. Get a loan/HELOC for it if necessary and the numbers work out, but don't enter into a long leasing agreement that can cause transferral problems down the road.

astura 8y ago
Not all leases are terrible, though most probably are. I have a leased propane tank, it's not a hassle or anything, I don't pay anything to lease it, I just pay the company for the propane when it need filling. It only needs filling like every 3-4 years because it's only used for the stove. I'm not really sure why its leased, but it could probably be replaced easily if need be. I think the people these sorts of things appeal to are the people who have poor credit and/or very little equity in their house.

JadeNB 8y ago

I know we change titles to avoid click-baitiness, but surely "What happened when I bought a house with solar panels" is not so sensational as to require truncating to "I bought a house with solar panels"?

throwaway5752 8y ago

I don't know enough about Sunrun or the author here, but I will say that - as a general principle - when you see a human interest piece about a multi-billion dollar company with close to 15% of their shares sold short (https://finance.yahoo.com/quote/RUN/key-statistics https://finance.yahoo.com/quote/RUN/key-statistics) then I would take it with a grain of salt and question what is being presented. edit: and you have to get more than halfway through to see the author managed to take the path of maximal pain: "Sunrun calls our insistence that Jug’s trust buy out and remove the system “incredibly unique and rare.” It’s far more common for home sellers to transfer the lease to the buyer—Sunrun says 94 percent of customers do this—or to prepay the lease and leave the hardware on the roof for the next owner to use. I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000 and allowed us to support solar and get “free” electricity, even as Sunrun remained responsible for maintenance and repairs." edit 2: "On consumer review sites and in local news reports, rueful customers warn others to stay away from TPO solar offered by Sunrun and other companies" - is that true of everything, and none cited? What if this was an article about car dealership? edit 3: Having finished the article (and having never heard of Sunrun prior to this) it has the feel of a hit-piece. I don't think it is necessarily (author seems to have a solid investigative journalism track record), but it cherry picks very small sets of data without context and it frames things in what seems like a maximally negative way. Not sure if their experience with their specific bad experience and Bloomberg's comp based on moving markets had anything to do with it.

rconti 8y ago

That buyout price is insane. It's more than we paid outright to have the same number of panels installed in the bay area.

jccalhoun 8y ago

Maybe it is because it is getting near lunch time but this article seemed really rambling and disjointed. Is it about Sunrun or is it about the industry? Or is it just the author's experience? It seems to be all three cut and pasted together haphazardly.

sigzero 8y ago

What happened to the ones Tesla was coming out with?

rficcaglia 8y ago
They recently (Dec) sent emails that they are scheduling appointments to those who signed up on the list. Says only one of the several tile options available though.
- jrnichols 8y ago
  I had such high hopes for the Dow Solar shingles. Maybe the Tesla ones will work out better.

mrdoops 8y ago

It's not strictly a per-company problem. The incentives are for per-watt i.e. bigger system = bigger commission for the company instead of maximizing customer savings with Solar. The incentives don't align customers, sales, utilities, and financial providers. Authority (City, Utility, etc.) typically push and constrain the installation at least 3-6 weeks and they rarely actually know Solar well enough to be a real 'Authority'. Lots of poorly implemented review procedures from untrained city officials and inspectors. Many unnecessary revisions, nitpicks, and expensive truck rolls surface here. Then we also have Sales and Financing Providers who have the most leverage out of the stakeholders. High leverage also means they tend to get the biggest cut for a given Solar contract. High commissions and high fees or they leave the installation company who has to fulfill a 2-6 month-payout-delay pipeline. The fulfillment team also has the most people to retain, train, and coordinate over what is typically a multi-state field operation problem. Not at all easy. Still, it boils my blood seeing some of these organizations fall prey to these pressures and turn to customer exploitation. What it amounts to is some deep-rooted systemic issues with the government-enforced monopolies of our utility companies, overly-simplistic incentives, and a market moving faster than the training and organizational development.

CydeWeys 8y ago

It's sad that the resolution of the contractual dispute involved removing the solar panels. That's a lose-lose for everyone -- the company because they have to spend additional labor, the new owner because they would've preferred them to stay at a reasonable price, and of course the environment. It's too bad the company couldn't come to terms somehow; surely accepting less money in a buy-out offer would have been better for them than having to come out and collect all of their equipment?

fouc 8y ago

It was news to me that California actually voted in a law requiring all new houses built after Jan 1, 2020 to have solar panels.

tomc1985 8y ago

The savings that Sunrun advertises seem rather... meager. $2000 over 20 years?

josefresco 8y ago

This reminded me of a casual conversation with an acquaintance about how they sold their home, with (older) solar panels and had some sort of agreement where they still got paid for the money generated by the panels. It sounded odd, as in; who would buy a house where something on the roof was generating income for the previous owner? - Wouldn't you (the buyer) just buy them out? No idea how this was structured - anyone have any background?

brandon272 8y ago
Sounds like either an agreement with the new owner that involved a price reduction on the home in exchange for the continued income. Or something totally shady!

figital 8y ago

I'd rather give excess power to my neighbors for free or just waste it on a giant spinning pinwheel than "sell" it back to the power company. No mention of local battery storage by the reporter or the "reported/reportee".

frankus 8y ago
Local battery storage is nice in a power outage, but right now it isn't remotely competitive with net metering. I pay US$7.94 a month to my utility to "store" megawatt-hours of electricity over the course of a year. Brand-name home battery storage is still well over $500 per kilowatt-hour installed. So yeah, I'll engage in shameless commerce with the evil corporate utility if they'll loan me a $2.5-million-dollar "battery" for less than 8 bucks a month.
dsfyu404ed 8y ago
If your power bill is not expensive enough for your taste learn to weld. Make sure you go gas-less, plasma and carbon arc for cutting, stick and flux core for welding. If that's still not enough start casting things. These hobbies also have the side effect of being great for one-upping your coworkers who do 3d printing.

SeanFerree 8y ago

Good article!

dev_dull 8y ago

This is almost entirely for people with solar leases, and not solar loans or paid-off panels. For panels that are paid off it's a great deal to pay a little more for the house. It just becomes a tax-deductible loan even though it saves you money each month.

AnonymousRider 8y ago

Do you also crave acknowledgement for your Prius, too?

gameswithgo 8y ago

I suppose if we ever sell our house we will need to remember to advertise that the solar panels are totally paid for.

georgeecollins 8y ago

An important take away from this article is simply the perils of home buying. People usually only do it once or twice in their life (I have done it twice so far) and it's really easy to make a very expensive mistake. Imagine this article with another property problem instead of Sun Run: a mother-in-law unit with a tenant, a disputed property line, a requirement to retrofit the house to make it earthquake proof, illegal additions to the house.. etc. All those things can be pitfalls in a house purchase that a buyer will not know much about. The realtor sounds extremely negligent to not correctly inform the buyer about the true situation until after offer is made. That should be a flag. Realtors understand loss aversion and that you can get very fixated on a particular house. Better to get you to start thinking the house will be yours then break the bad news to you. People just don't buy houses often enough, and they get too emotionally attached, to make rational decisions. Listen to the author talk about how this is the place where he might raise a child. That sounds so portentous, but really wherever you live is where you might raise a child. Owning a house can be great, but the best way to do it is to think about it like buying a used car. Realize the people you are working with are nicer, smarter used car salesmen. Check everything out with true third parties and be ready to back out.

fbonetti 8y ago
> An important take away from this article is simply the perils of home buying ... it's really easy to make a very expensive mistake. This article was interesting but I don't think the author was at any risk of making a financial mistake. At the end of the day, Sunrun had a lien on the property. The title company and the lender would not allow the sale to go through unless the Jug estate was able to deliver a clear title. If the title company somehow missed the fact that Sunrun had a lien on the property, the author's title insurance would cover the damages. > Check everything out with true third parties and be ready to back out. The insurance company, title company, lender, and home inspector are already highly incentivized to ensure that the property isn't a dud.
- georgeecollins 8y ago
  You are right. He made an arrangement to have the seller remove the equipment that SunRun itself said was rare. People don't often accept surprise problems in homes with less negotiation. Don't do that.

filesystemdude 8y ago

I evaluated solar cells for my home, and ultimately decided against because I probably get more total energy saving from the current passive solar of having huge south-facing windows and an oak tree in front of my house - free heat in the winter, shaded in the summer. For solar electric to work, the oak tree would have to go. That said, central issue mentioned in this article aside (which is legit concerning), cost wasn't really an issue I spent much time worrying about. Am I the only person more interested in giving the middle finger to my corrupt utility provider and their coal-centered power generation strategy than whether I came out a few bucks ahead or behind in 20 years? I suspect a lot of people who install solar have similar motivations. But that in itself can be a problem, too. The thing that concerns me about household solar is that it's a bit like owning a Prius - it becomes a status symbol for people more interested in _appearing_ green and assuaging their guilt than actual concern about their total carbon footprint. Take a vacation to Hawaii once a year and you'll probably knock off every single bit of good you did for the planet.

gwbas1c 8y ago

I just built a house with solar panels. I had a bit of trouble with the bank, because the appraiser refused include the panels when appraising the home. Ultimately, my state offered better financing than a traditional mortgage. I just wonder what's going to happen if I ask a buyer in 5, 10, or 20 years to pay for the panels. They clearly reduce the home's energy consumption, and thus have a clear demonstrated value.

joshe 8y ago

The tax credit thing as designed by legislation is nutty. It lets companies buy your tax credit and use it to offset their own income. Leading to all this zero value financial engineering. But from a homeowner's point of view and Sunrun's point of view it makes sense. Lots of people might not be able use the tax credit because they already owe have low income tax (moderate income + mortgage interest deduction, or retired with a nice nest egg will get you to very low income tax). (If you pay enough income tax to use the credit you should just get a loan and avoid this.) This was legislated poorly, probably in order to call it a "tax credit" instead of "subsidy". A subsidy would be much cleaner, have the same economics and they should just do it that way. This whole mess and industry was created just for this one talking point. The government giving you $2000 off an installation is the same as getting a $2000 tax credit from the Treasury's point of view. Sunrun sounds like not the best business to be involved with. Like "new buyer doesn't want the system" is an obvious thing for the customer service manual. (Referring to "...prepay the lease and leave the hardware ... I’ve been kicking myself ever since I learned about this latter option. It would have saved the estate around $12,000"). Also they are clearly selling this to a bunch of people who could easily use the tax credit and could easily get a homeowner's loan. Super dodgy. I'll bet a lot of the sales nonsense is to hide this fact.

jawns 8y ago

Here's a cautionary tale of purchasing a home with solar panels, even if they're not leased from a third party. We bought a house with solar panels in 2016. The seller had purchased the system less than a year before the house went on the market, and one of the key selling points was that there was no lease to deal with; by purchasing the home, we would 100% own the solar panels and would reap all the benefits of what they generated. Six months after the sale was finalized, we changed Internet providers and soon after that, we were forwarded an email by the seller from an organization we had never heard of, asking us to reconnect the solar panels to the Internet as a condition of their contract. Um ... what contract? It turns out that when the seller purchased the panels, they made a deal with this green-energy company, which was sort of a joint venture between our state's biggest utility and the state itself. The organization paid the seller $6K up front. The seller, in turn, agreed that for the next 20 years, any Solar Renewable Energy Credits generated by the panels would belong to the organization. The existence of this contract, which included a lien on the SRECS, was never disclosed to us. And it never showed up on the title search because the lien was on this abstract credit, not on any physical property. The lawyer who did the closing had never heard of anything like it! We ended up having to get a different lawyer involved, and it was a big production, because not only had the organization dealt with relatively few transfers of ownership, it had never dealt with a case where the SRECS contract was not transferred as part of the home sale, and undoing the mess the seller had caused by not disclosing it took a lot of legal legwork. In the end, the organization agreed to remove the lien, rather than continue a legal battle, and I assume it then went after the seller for whatever portion of the $6K advance payment it could recoup. The lesson I learned from all of this is that when it comes to solar panels, not even the people in the industry have much experience with the edge cases. And although installations are starting to become routine, transfers of ownership are not yet routine. (By the way, the solar panels work well, and our energy bills are very low, but I wish someone would have told me that squirrels love to build nests under the panels and chew through wires, because yeah, that's happened, and it's not covered under the warranty.)

protomyth 8y ago
Squirrels and mice are a pain for electrical wire. That's why its important to get them the heck out of your garage. Its never fun to have a car need repairs because the damn things chewed through a cable. Had to replace a friends spark plug wires on his car because he thought the critters were cute.

rebuilder 8y ago

The article says Sunrun's shares rose when California decided to mandate solar panels on new constructions starting 2020. This doesn't really make sense to me. The reason stated was that developers don't like to install solar because it inflates the sticker price, but if you're taking out a mortgage, then you're probably looking at a payback timeline similar to the 20 year lease Sunrun offers. I don't really see how it makes sense not to take on the 5-10% (depending on installation size and house price of course) extra mortgage for what should be a cheaper overall cost over a similar timespan.

linuxftw 8y ago
People don't buy houses, they buy payments. Specifically, whatever their lender will give them. Any additional principal balance is more they have to qualify for and more money required for down payment. If you're thinking "Wow, that's nuts that people would spend 100% of what a lender will qualify them for," then, I say to you "Welcome to America."

b1r6 8y ago

Why would anyone do this? You should either save up and buy PV infrastructure outright, or not have it at all. Being tied to some sketchy company via contract sounds horrid. I would automatically exclude any homes with this setup from my search.

socrates1998 8y ago

While this company is doing some pretty shady shit, it's actually not worse than what traditional electric companies do. Talk about corruption and dishonest practices. In Florida, FPL, the electric provider for half of Florida, complained for about a decade (from 2004-2014) on how how they needed to keep raising rates so that they could continue to "upgrade the infrastructure" so that they could be prepared for the hurricanes that inevitably would hit the coast. Some estimates that FPL made a few extra billion dollars on the price increases that went beyond normal inflation. What do you think happened when south Florida got hit with the next major hurricane in 2014? Yup. same outages that we saw in 2004. And the hurricanes weren't even worse. 10 years and billions of dollars in "upgrades" resulted in the same exact problems. FPL took our money and didn't do anything with it. AND they have been vehemently against people owning solar panels, even going as far as blocking legislation that would allow people to install them on their own homes without special permission from "FPL approved" companies. And you can guess how many "approved" companies they would actually approve. I have yet to see any major utility company operate with any decency, so while this solar panel company is doing some shady shit with their salespeople and leasing terms, it at least didn't scam millions of people for billions of dollars like FPL. Florida should have the cleanest electricity in the world. Sunshine almost every day, but we don't have it because: A) We don't price in the environmental impact of non-solar producing coal and natural gas plants, thus keeping solar "more expensive" than fossil fuel electricity. B) FPL actively blocks the widespread adoption of solar panels on people's homes. C) Politicians are happy to take money from FPL and other interest groups that don't want to adopt solar.

01100011 8y ago

A friend was a salesman for SunRun back in 2011 and at the time I was growing pot so I was looking to reduce my energy costs. I got an 8.8kW system(a bit large for my house). I spent probably $1k/year extra for electricity during the first year. Over time, the system started to actually save me money, but it took about 5 years. I also had a bunch of power I was obligated to buy, so I lost the incentive to conserve and ran my central A/C nearly all the time. When I had to sell my house after a divorce, I realized what a pain in the ass it would be. I had to convince the buyer that it was a good idea to assume the lease. I found out things like the requirement to pay thousands to remove the system if the roof needed replacement(one SunRun rep, not my friend, hinted during sign-up that they maintained the roof). The system only saved money if you consumed a lot of electricity. If you didn't need the power, you're stuck paying for it anyway. Fortunately the buyer went for it and I escaped the lease. Another annoyance was the inverter box that SunRun installed right outside my bedroom. Every morning and night, the system would turn on and off several times as the light levels were close to the threshold. This meant some rather large relays were clicking repeatedly, waking me up at dawn a lot of the time. On the plus side, I got a new breaker panel and had my service rating upgraded from 100A to 150A. If I had to sum it up, I'd say that SunRun isn't absolutely evil, but if I ever do it again I would buy the system outright, assuming it was economically viable. My personal opinion is that residential solar is a misallocation of resources as long as there are commercial rooftops without solar.

zmix 8y ago

> "amplify the pain significantly" Wow, this is violence! With such extremisms being legit, one must not be surprised, if extremism rises on all fronts! Who likes business (wo)men?

ananonymoususer 8y ago

I'm closing on a new house tomorrow. The builder has a business arrangement with Sunstreet Solar and they have a ~4KW plant on the roof. While researching the details of the sale, I discovered that Sunstreet owns the panels and has an easement. They get 80% of the generated power and give me 20%. This did not seem like a good deal to me. I negotiated the purchase of the system from Sunstreet as part of the sale, and I got the home builder to reduce the price. This way I can claim the federal tax credit, and I get 100% of the generated power instead of 20%.

aj7 8y ago

I spent considerable time evaluating solar installation, in of all places, Tucson. The perfect place, right? I viewed it as replacing a fixed income investment. (1) The internal rate of return was 1% (2) It was obvious that any government subsidy was swallowed up by price increases. This was very sobering to a leftist like me. (3) Grid connection and resell are critical, but there is no way to guarantee the terms of this into the future. After all that, my wife’s intuition was still crucial in nixing the panels.

rhacker 8y ago

DIY array with 17 panels should cost $5000 today with inverters and grid tie - thought I would forgo the grid tie and just get a shit fuck ton of lead acids (probably 30 for another $3000) and have energy for at least a day. Stop paying these racket companies and their dumbass contracts. The DIY is totally easy.

lightedman 8y ago
You're way overestimating. I see a 6kWh system (that's 24-ish panels) with inverters for $3500. New runs about $5K from the company I produce panels for. 30 good SLAs, that's a bulk quantity buy and you can get them for about $30 each at that quantity, so $900.

codingdave 8y ago

The fact that this is about solar is diminishing the actual lessons here - don't sign contracts that are tied to your home's title. And if you find a home you love that has a contract on its title, just walk away before getting attached.

briandear 8y ago

Saving $24 a month with solar panels seems hardly worth the effort. Why not just build nuclear plants and dispense with the tedium of house installed solar? Dealing with solar panels seems like such a such a pain.

peter303 8y ago

I get 3rd party solar sales calls nearly every day. I cut to the point and tell them my all-LED house plus new refrigerator averages 85 kwh month. That stops them cold because they require 1000 kwh to make a profit. Maybe if I got an EV I could crank up the usage a good deal. I still dont know why they have called me several hundred times.

sabujp 8y ago

is there any company that hasn't gotten big by lying, cheating, overpromising, stealing a dollar here and there, etc?

sabujp 8y ago

i think the next time the costco sunrun person tries to say hello to me, I'm going to ask him how well he's been doing amplifying the pain

cjhopman 8y ago

> If Southern California Edison's residential rates continue to rise annually by 2.2 percent, as they have on average over the last decade, Jug's total electricity outlay having gone solar would have cost about $6,000 more over 20 years. Isn't the math that came to that conclusion completely fucked up? $115(1.022 ^ 20) = $177 $75(1.029 ^ 20) + $17 * (1.022 ^ 20) = $159 In fact, I'm about 100% sure that that $6000 figure is the amount of additional money that is payed to sunrun due to the increase costs (difference between $75/month for 20 years and the cost with 2.9% increase). It looks like the journalist then went and misinterpreted that data and made up a completely fake chart below it to fit their interpretation of the data. In that chart, clearly the socal edison side should start with a higher cost than the sunrun side and the socal edison cost at 20 years should actually be above the $2k line.

cjhopman 8y ago
Okay... way at the end of the article they say that $115 isn't the real amount he was paying, he was only really paying $79. Making that change gets a lot closer to their -6000/+4000 for 2.2%/4.75% electricity increases.

wkearney99 8y ago

Ugh, I do wish there were more neutral sources to learn more about residential solar. Everything seems like such a con. I've got plenty of roof and reasonable capital to purchase gear but nowhere near the time to ferret out what's legit, what's a pie-eyed-pile-of-crap and what's an outright scam.

misterpoopoo 8y ago

There’s a couple things wrong with this article and I have a decent understanding of why Jug (RIP) did what he did. (I worked at Sunrun and created this fake account to hide identity; I worked in finance). Not to bash the sales reps or trainers, but they are so far removed from the financing of the product they don’t know what’s going on. First, at the end the sales rep who provided the #s is bullshit. The sales reps are notorious for inputting whatever #s they want into the internal SFDC system so the average monthly bill isn’t accurate. This isn’t an exception, it’s their own rule to accelerate sales (management does not tell them to do this. To be specific) The 2.9% escalator is an aggressive and risky product, but requires zero upfront and an incredibly low initial $/kWh. He more than likely was saving money and would have been for at least several years. I don’t know his intentions but you can read between the lines and I don’t want to talk about the dead. Also, I forget if Conedison does tier pricing, but if it did with all his gadgets, his bill would have been through the roof. Lastly, Sunrun does offer cash/loan/0%/1.9%/prepaid products, and if I were to go for a cash deal, I would use Sunrun/Vivint/SolarCity because it’s a huge headache to coordinate with developers and file all the correct paperwork.