Privately held solar power firm SolarCity is expanding in Colorado, its fourth market, and sees more expansion next year, the company's chief executive said on December 15. SolarCity, whose backers include U.S. solar panel maker First Solar Inc, plans to enter five more U.S. states in 2010. It currently works in California, Oregon and Arizona.
-- Solar installation co looks to expand in 5 more states
-- Has worked through half of $100m fund with US Bancorp
-- First Solar among privately held company's backers
"Right now the company is heavily focused on expansion and providing more clean power to more homeowners", SolarCity's chief executive Lyndon Rive said in an interview.
The company, which finances, builds and maintains solar systems for homes and small businesses, turned cash flow positive this year, Rive said.
Key to recent success has been a lease strategy where SolarCity finances and builds a solar array on a homeowner's roof and then sells the power in a lease arrangement. Earlier this year the installer teamed up with a unit of U.S. Bancorp to put panels that convert sunlight into electricity on homes and businesses and in September doubled the fund for lease financing to $100 million. "The expectation on both sides is that we continue doing more and more funds," said Rive, adding that more than half the fund had been spent.
SolarCity also partners with the National Bank in Arizona.
The executive said that a push for an initial public offering is not driving the company, but noted that "as we get larger and larger, an IPO could be part of equation."
EXPANSION:
The executive declined to specify where the company would move next. But he noted that states like New York and New Jersey are attractive as well as areas like Ontario, Canada. The incentives for solar power and other renewable energy in each state are a "massive factor" in deciding which markets to enter, Rive said.
Colorado passed a law earlier this year allowing homeowners and small business to take out loans to finance clean energy projects, clearing the way for third-party companies like SolarCity to build and own solar systems and lease them to customers.
SolarCity's move into Colorado marks the first time the state's residents have the option of financing a solar system - starting at a cost of $45 per month and no upfront cost, Rive said.
GREEN JOBS:
In its newest market, Rive said that SolarCity will focus on the areas of Denver and Boulder where Xcel Energy Inc supplies electricity to residents. The company could expand to other parts of the state depending on demand.
They plan to hire 30 to 40 employees, both installers and salespeople, to start in Colorado. Overall, SolarCity currently has more than 500 employees and has 170 open jobs. "Most of the jobs and the amount of people that is required to install a kilowatt (of solar power) employs more people than actually manufacturing the technology ... Someone needs to come on the roof and install the solar panels," Rive said added.
Cutting the cost of solar power is the most important factor for the industry, the executive said. "If the cost comes down and you end up buying panels from overseas because it's cheaper to manufacture over there, the net benefit ... will hopefully still be there as people are still installing a lot of solar," Rive said.
SolarCity uses panels made by U.S. companies First Solar Inc and Evergreen Solar Inc as well as Japan's Sharp Corp, Kyocera Corp, BP Plc's solar unit and Chinese heavyweight Suntech Power Holdings Co Ltd.