Google (Nasdaq: GOOG) is cozying up with another renewable energy company in an effort to expand solar developments and get a little better return on its cash. Yesterday the company announced it is creating a $280 million fund for SolarCity to expand the company's residential leasing program.
SolarCity is a full-service solar company providing design, financing, installation, and monitoring for solar systems. The funds from Google will be used to finance residential projects instead of homeowners paying for the entire installation themselves. SolarCity has set up 15 such funds totaling $1.28 billion with partners including US Bancorp (NYSE: USB).
Google has lots of cash on hand and has been looking for ways to expand its "do no evil" mantra with renewable energy. The company is invested in building a $5 billion wind power transmission corridor off the Atlantic coast and wind farms in North Dakota, and it has also made investments in thermal solar company Brightsource Energy.
Solar manufacturers should cheer anything that helps make solar power more accessible in the U.S. market. Established higher-efficiency companies like SunPower (Nasdaq: SPWRA), Trina Solar (NYSE: TSL), and Yingli Green Energy (NYSE: YGE) in particular should benefit. They create more power on valuable rooftop space and have a longer operational history for installers to rely on.
Foolish bottom line
Google is slowly turning itself into a major funding source for renewable energy companies. In time, that arm may become a major source of income for the company. For now, solar backers can just cheer a major U.S. company putting its weight behind solar power.
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