The solar boom has apparently made it all the way to Wall Street.
Stock values are skyrocketing for companies that install rooftop solar systems at little or no cost and then sell the electricity to homeowners for less than what utilities would charge, according to a story in The New York Times.
One such company is SolarCity, whose share price has risen to seven times its initial value. When the Times published its story on Jan. 3, the stock was trading at $59.27. Six days later, it had risen to $67.74 a share, and a company that didn’t exist eight years ago was valued at about $5 billion.
Brothers Peter and Lyndon River and their cousin Elon Musk, the co-founder of PayPal who later went on to make the Tesla electric car, are behind SolarCity. The company currently operates in 13 states, has more than 80,000 customers, and is the largest provider of rooftop solar systems in the country, according to the newspaper. Competitors include Sunrun, Sungevity, and Vivint.
For homeowners, an easy way to get into solar power
The cost of residential photovoltaic panels has dropped dramatically in the last several years, down by 75% since 2008, according to National Geographic. A 30% federal tax credit also has made systems more affordable.
But solar isn’t cheap. According to an annual report published by the Lawrence Berkeley National Laboratory, the median installed price of PV systems in 2012 was $5.40 per watt for residential and small commercial systems. At that price, even a 5kw system would cost $27,000, making a no-cost or low-cost installation very attractive.
SolarCity promises free consultation and design, takes care of all permits and inspections, and monitors the system once it’s in place. The company guarantees power production for the life of the contract.
According to the Times, however, not all customers are happy. Complaints to the Better Business Bureau about misleading advertising and faulty installations are rising, as are negative reviews at online forums such as Yelp.
That hasn’t slowed growth. SolarCity says it signs up a new customer every three minutes during working hours. The company hopes to hit its one-millionth installation in four years, the Times said.
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