Utilities are taking advantage of a sweet spot in the capital markets, pre-funding and refinancing at record low rates. But cheap money won’t resolve overhanging uncertainties preventing cap-ex...
Solar Leasing Shines
With meters running backwards, utilities seek a niche.
and a strong payback proposition.
Reliant’s lease structure eliminates the need for homeowners to deal with the high up-front costs of directly purchasing solar systems. It allows them to choose how much money they want to put down, and even provides the option to pre-pay their leases. “This allows customers to get into solar for a lot less money,” Horning says. Reliant’s leasing vehicle is run through NRG SunCap, a fully-owned division of Reliant’s parent company, NRG.
To manage logistics, Reliant offers a network of professional installers. It also provides a power production guarantee, guaranteeing the output over the 20-year lifespan of the lease. “If it fails to produce at that level, we have a mechanism for reimbursing the difference,” he says. “In addition, since we own the panels, we cover all the maintenance, repairs, and insurance for the life of the lease.”
Finally, the program offers a net-metering plan—which the company calls “sell-back”—in two forms. One is the Reliant e-Sense Sell Back Plan, which offers on-peak and off-peak pricing. The sell-back price is the same as the energy charge for the first 500 kWh returned to the grid. Reliant pays 5 cents per kWh for any additional electricity produced by the customer. The other is the Reliant Sell-Back Plan, which provides price security for 12 months. In addition, Reliant purchases any surplus electricity the customer produces. It provides a bill credit for the first 500 kWh of excess electricity that the customer generates at the full retail energy charge, and pays 5 cents per kWh for any additional electricity that is returned to the grid.
Horning sees Reliant’s program as gaining in popularity. “Most customers,” he says, “are looking at it from a price security perspective—being able to lock in a large percentage of their usage over the next 20 years at a fixed price, when prices are fairly low.”