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https://www.wundercapital.com https://www.wundercapital.com The problem with commercial solar is the cost of the financing. Home solar is on par with a car loa

https://www.wundercapital.com https://www.wundercapital.com The problem with commercial solar is the cost of the financing. Home solar is on par with a car loan, banks know how to do that with personal credit scores. Utility scale solar is the realm of private equity. Something like a strip mall is a weird in-between that requires enough manual review that the cost to do all of the risk analysis that financing requires kinda outweighs the potential returns. Will that KMart or Costco keep that store open for the duration of the project? What happens when the tenancy changes? I don't have any relation with Wunder, but from my understanding of them, they built some stuff to streamline all the financing and permitting required of commercial-scale to make those projects pencil out.

bwb 7y ago
Walmart is doing it in a lot of locations. I've heard they also believe if electric cars get going they can offer free recharge with people buying xx dollars of groceries.
- guntars 7y ago
  Yep, I’ve seen their solar roofs covering the parking spots in Flagstaff, AZ. It’s a win, win - they get power and it keeps the cars cooler.
  - anderspitman 7y ago
    I saw a random magazine 10 years ago that claimed Flagstaff was one of the top 3 "greenest" cities in the US. Prescott (where I'm from) was top 3 skinniest.
kragen 7y ago
On the contrary, personal loans from banks routinely charge much higher interest rates than commercial paper. Think about the interest rate on a money market account, which consists of bonds. That's the rate PG&E is going to pay if they float a bond issue to build a solar power station. Large companies, particularly including electric generation utilities, can also get loans from banks at similarly low interest rates. This is precisely the genius of SolarCity: they were able to use the low interest rates banks would charge them to install solar power on people's houses at a much lower cost of capital than the same banks would have charged the same homeowners without SolarCity's intermediation.
- thaumasiotes 7y ago
  > This is precisely the genius of SolarCity: they were able to use the low interest rates banks would charge them to install solar power on people's houses at a much lower cost of capital than the same banks would have charged the same homeowners without SolarCity's intermediation. That sounds like a pretty interesting pitch as a business model. But if I recall correctly, SolarCity failed and had to be bailed out by, um, Tesla. Why? Was the free money just not enough?
  - deleted 7y ago
    [deleted]
- cogman10 7y ago
  I'm going to push back a bit. Interest rates can be favorable to a company but not money market fund favorable. That would be a better interest rate than a US treasury note. PG&E currently has 2.4% bonds out. Better than what you can get, but not lower than a mmf (usually less than a percent). As a rule of thumb, rates won't sink lower than ten year tnote rates. Nobody will purchase a bond from a company that has a lower rate than a tnote.
  - kragen 7y ago
    Thank you for the concrete numbers and the correction/additional information!

bwb 7y ago

Walmart is doing it in a lot of locations. I've heard they also believe if electric cars get going they can offer free recharge with people buying xx dollars of groceries.

guntars 7y ago
Yep, I’ve seen their solar roofs covering the parking spots in Flagstaff, AZ. It’s a win, win - they get power and it keeps the cars cooler.
- anderspitman 7y ago
  I saw a random magazine 10 years ago that claimed Flagstaff was one of the top 3 "greenest" cities in the US. Prescott (where I'm from) was top 3 skinniest.

kragen 7y ago

On the contrary, personal loans from banks routinely charge much higher interest rates than commercial paper. Think about the interest rate on a money market account, which consists of bonds. That's the rate PG&E is going to pay if they float a bond issue to build a solar power station. Large companies, particularly including electric generation utilities, can also get loans from banks at similarly low interest rates. This is precisely the genius of SolarCity: they were able to use the low interest rates banks would charge them to install solar power on people's houses at a much lower cost of capital than the same banks would have charged the same homeowners without SolarCity's intermediation.

thaumasiotes 7y ago
> This is precisely the genius of SolarCity: they were able to use the low interest rates banks would charge them to install solar power on people's houses at a much lower cost of capital than the same banks would have charged the same homeowners without SolarCity's intermediation. That sounds like a pretty interesting pitch as a business model. But if I recall correctly, SolarCity failed and had to be bailed out by, um, Tesla. Why? Was the free money just not enough?
- deleted 7y ago
  [deleted]
cogman10 7y ago
I'm going to push back a bit. Interest rates can be favorable to a company but not money market fund favorable. That would be a better interest rate than a US treasury note. PG&E currently has 2.4% bonds out. Better than what you can get, but not lower than a mmf (usually less than a percent). As a rule of thumb, rates won't sink lower than ten year tnote rates. Nobody will purchase a bond from a company that has a lower rate than a tnote.
- kragen 7y ago
  Thank you for the concrete numbers and the correction/additional information!