Australian households looking to install rooftop solar could soon have a new no-money down financing option at their disposal, after the launch a pilot solar leasing program by SunPower in Melbourne this week.
In the latest PV leasing offering to test the water in Australia, the Nasdaq-listed solar company will install its solar panels on suitable metropolitan Melbourne rooftops at no upfront cost, offering instead a predetermined monthly payment for 25 years.
The SunPower Choice program locks in solar electricity rates for the life of the lease, and offers a money-back guarantee on the amount of solar the installation will produce annually. Free monitoring and maintenance is also provided for the length of the agreement.
At the end of the 25 years, homeowners will have the option to purchase the system outright, or extend the lease. The lease can also be cut short at any point and the system removed for a fee.
In an interview on Tuesday with RenewEconomy, director of solar ESP for SunPower Australia Kevin Whelan said the California-based company was confident about the prospects of the Melbourne pilot, regardless of the latest gloomy update on the fate of Australia’s renewables policy.
“We’re really excited about the trial,” Whelan said. “We’ve had great success with (solar leasing) in the US, and we think we can replicate that success here in Australia.”
And while Whelan conceded it was “unfortunate” to hear the latest reports around the RET, he noted that this kind uncertainty around policy and power prices was part of SunPower’s motivation for offering their leasing product here.
“Our program gives a certainty about the cost of energy when there is uncertainty with everything else,” Whelan said. “Irrespective of what happens with the RET, it gives rooftop solar customers long-term certainty on their electricity prices.”
Along these lines of logic, SunPower is also set to launch a separate pilot program in Australia testing the market demand for solar with storage, in a program likely to be rolled out through its partly owned local retailer Diamond Energy. It is also looking at microgrid solutions in Australia, although it sees the biggest potential in the commercial rooftop market.
SunPower, which also offers cash and loan programs for rooftop solar customers in Australia, says the rooftop solar leasing pilot program further reinforces its commitment to the Australian market.
It also follows on from the US company’s successful residential lease program in its home country which, launched at the end of 2011, soon claimed one-third of the Californian market – the nation’s biggest – and within a year was signing up deals at a rate of 2MW a week.
“The residential lease value proposition is compelling. Homeowners can purchase the best solar technology in the industry and be cash-flow positive from day 1,” CEO Tom Werner told analysts in a conference call in late 2012.
As for the Australian market, SunPower CEO Tom Werner recently described it is one of the most attractive in the world, with its combination of good sun, open spaces, and high electricity costs.
“Solar makes sense here,” Werner said in an interview in Sydney with RenewEconomy. “The economics of solar work better in Australia than in most places in America,” where the long-term trend in solar is clear because the economics are also so strong.
“The horse is out of the barn already in the US … and it is the same thing here. It is hard to put the genie back into the bottle. People want solar and it is economic, so it is going to happen. The question is how do you get there?”
Local PV start-up Kudos Energy also sees a big future for Australia in solar leasing, with recent predictions the residential and commercial sectors could reach $100 billion in the next decade – although Kudos founder David Jones did stress that this would rely on the renewable energy target, and the continuation of the small-scale component.
And WA grid operator IMO recently predicted that 75 per cent of the state’s detached and semi detached homes and 90 per cent of commercial businesses could have rooftop solar within a decade.