This Week in Solar

Earnings season for solar companies is in high gear and, this week, SunPower (Nasdaq: SPWR  ) reported strong earnings, continuing a trend started by First Solar (Nasdaq: FSLR  ) last week. But the company lowered full-year revenue guidance, and the stock dropped, so it was a bit of a disappointment for investors. For my full coverage of SunPower’s earnings, click here.

But that wasn’t the only new in solar -- here are more highlights, including solar leasing, solar thermal, and a new milestone for a solar manufacturer.

Solar lease -- the hottest thing in solar
The solar lease has become the driver of residential solar in the U.S., and installers and financers are lining up to get involved. According to the Solar Energy Industries Association, 63% of residential solar installations in 2012 have been third-party financed in California, and 80% of such financing is used in Colorado.

Third party financing is attractive, because homeowners can install solar with zero money down, making a system profitable from day 1. SunPower provided financial details of its leasing program in its earnings presentation this week. According to the company, a 7.2 kW system will cost homeowners nothing upfront, and save them $63 per month in California. To see the assumptions and details of the program, click here (it’s on page 14).

Solar City, Sunrun, Clean Power Finance, OneRoof, and Borrego Solar all offer similar programs, and financiers are putting more money into their lease programs. This week, SunPower announced $325 million worth of commitments from Citi (NYSE: C  ) and Credit Suisse for its leasing program. This is on top of $200 million in financing for Sunrun, and $64 million for Borrego Solar, recently.

Residents aren’t the only ones saving money from the deal, because banks funding these leases offer what's called tax equity, which allows them to save on taxes with the investment tax credit. For solar, these leases have been a win-win for everyone involved, and are a major driver of the industry’s growth this year.

Solar thermal’s flagship project
The Ivanpah Solar Project had a big week, reaching the midway point of its construction. The project, owned by NRG Energy and Google, using BrightSource Energy’s technology, is a 370 MW project that will cost $2.2 billion, and will use mirrors to bounce the sun’s rays to a power tower, which power a turbine engine to create electricity.

Other news and notes
Here are a few more highlights from the industry this week.

  • Suntech Power (NYSE: STP  ) said it crossed the 1 GW level of deliveries in the Americas, a major milestone for the industry’s biggest module maker. The company has run into financial trouble in recent weeks, and investors will be watching the company’s earnings report from the second quarter for signs of what’s to come. 
  • JA Solar (Nasdaq: JASO  ) announced an agreement to sell A Shade Greener, a U.K. residential solar installer, 47 MW of solar modules, which will commence this month.
  • Satcon Technology announced earnings this week, and revenue fell 48% to $23.7 million, but net loss improved to $6.6 million, or $0.37 per share, from a $21 million loss a year ago. However, the company it's still in dire straits, with only $3.0 million of cash on the balance sheet.

Chinese manufacturers are next up to release earnings and, after some downward revisions, I’ll be watching closely how margins are trending and if balance sheets are becoming an issue, something SunPower and First Solar both pointed to as strengths.

Speaking of First Solar, we have a new report on the company, with a detailed look at the company’s market position and potential. The report comes with updates when big news happens, so you can always stay up to date on the company. Click here for details.

Fool contributor Travis Hoium owns shares of SunPower in both personal and managed accounts. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw.

The Motley Fool owns shares of Google and Citigroup. Motley Fool newsletter services have recommended buying shares of Google. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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