Is SolarCity Taking a Risky Strategy in Solar Lease?

The solar lease has driven SolarCity to industry dominance, but is that form of financing will homeowners want in the future?

Travis Hoium
Travis Hoium
Jul 24, 2014 at 3:00PM
Energy, Materials, and Utilities

SolarCity (NASDAQ:SCTY.DL) has built a dominant position in the residential solar industry by offering leases to customers for as little as $0 down. The financing method was easy for customers to understand, and it saved them money, so there's been little friction in expanding it around the country.

But solar loans are now being offered by large installers like SunPower (NASDAQ:SPWR) and smaller installer RGS Energy (NASDAQ:RGSE) -- in some cases with $0 down. This financing option may become more attractive in the future because homeowners can keep the tax benefits, and they own the system at the end of the loan period.

Solar specialist Travis Hoium covers why owning the system may be important in the video below.