SolarCity (Nasdaq: SCTY) introduced MyPower today, a first-of-its kind solar financing option that combines the low upfront cost and immediate utility savings of a power purchase agreement (PPA) with the benefits of ownership. SolarCity customers pay for their MyPower solar loan similar to the way they pay for a solar PPA—based on the energy the system produces from the sun—but they retain ownership of the solar panels.
MyPower’s unique structure creates America’s most affordable solar loan—with a lower cost than PPAs in many locations. MyPower can allow customers to pay as much as 40 percent less for solar power than utility power, and unlike other loans, MyPower allows customers to prepay their entire balance or prepay a portion of their solar loan to lower their monthly payments at any time, with no fees or penalties.
SolarCity has become America’s #1 residential solar service provider—the company installed more residential solar in the second quarter of 2014 than its next 50 competitors combined —by providing solar electricity directly to homeowners for less than they pay for electricity from utilities. Now SolarCity is lowering the cost of solar electricity even further by leveraging its scale and low cost of capital to act as a direct lender to its customers through its subsidiary, SolarCity Finance Company. MyPower customers can enjoy a fixed annual percentage rate as low as 4.5 percent for 30 years. Due to its potential to lower the cost of solar electricity, SolarCity ultimately expects MyPower to expand the addressable market for solar power to areas of the United States that have traditionally seen very little adoption.
While most solar loans are provided by third-party banks and municipalities in partnership with solar manufacturers and regional installers, SolarCity has created the industry’s best financing terms by lending directly to customers as part of its full-service model. Some competitor products place a lien on the customer’s home and involve an onerous approval process. MyPower places no lien on the home—making it easier to transfer in a sale—and it only has a minimum credit score requirement of 680.
As with all of SolarCity’s solar financing options, MyPower will include the industry’s best service package. MyPower customers will enjoy a 30-year warranty, production guarantee, and monitoring service package. SolarCity backs up its agreements with the largest in-house service footprint in the industry—its 52 operations centers serve 15 states.
Starting today, SolarCity will offer MyPower to customers in Arizona, California, Colorado, Connecticut, Hawaii, Massachusetts, New York and New Jersey, and ultimately plans to expand the product beyond its existing service territory. Homeowners interested in MyPower can contact SolarCity directly at 1-888-SOL-CITY (1-888-765-2489) for a free, no-obligation solar consultation or visit the company online.