There’s no doubt about it — SolarCity is king of the hill in the US rooftop solar market. A lot of people are inclined to “hate on the king,” especially those who might be competing with him. For a long time, we’ve had commenters complain about SolarCity, saying that it fleeces customers and is a total ripoff. While not arguing that these people are wrong, we simply haven’t had any aggregate hard data or reports to confirm this… until now.
First of all, let me get a very important and counterintuitive disclosure out of the way: I’m a SolarCity investor. In other words, you can be sure as heck I’m not writing this piece to bash the company for selfish purposes. Furthermore, I’m also not planning to sell my SolarCity stock anytime soon, since I think it has competitive advantages that could very well keep it in the throne of a fast-growing market. But as an investor and a person who cares a great deal about society as a whole, I wasn’t happy to find out about this story.
The data and its interpretation come from Pick My Solar. Pick My Solar is a unique and objective startup. It takes in data from potential solar customers, then gets bids from various solar installers in the area, and then evaluates the bids based on a variety of factors before recommending a few options to the customer. This is unique since most solar lead companies simply send the customer on to installers and leave it to the customer to evaluate and decide who to go with. Comparing the options provided by competing installers, the Pick My Solar crew began to see a pattern — SolarCity’s prices were well above the pack.
In particular, Pick My Solar highlighted SolarCity’s MyPower solar loan bids. It found that those bids (only in California) came out 34% higher than the California average. The difference was nearly $10,000 for an average system! (No, I wasn’t using the word “shockingly” in a light manner.)
In a July article about the finding, Pick My Solar wrote: “The cost-per-watt on SolarCity’s MyPower contract is always consistent, no matter what the size of the project. They price systems ranging from 2.5kW to 10kW or larger at the same $5.10 per watt (cash or financed). Having no discrepancy in price is an obvious red flag. Overhead, permitting, engineering, and transportation are generally consistent costs, no matter what the project size – which means more dollars are going to profit margins on larger projects.” Yes, it is again shocking that SolarCity’s per watt price doesn’t change with large differences in system size.
Sadly, that’s not the end of the story. SolarCity is also behind the curve when it comes to turning on a solar power system. Pick My Solar found that most solar installation companies in California get the system turned on within 2 to 4 months once the contract is signed. “SolarCity is an outlier here, known to take six months or more to install a system due to backlog and inefficiencies. The MyPower contract confirms this exasperated timeline, stating that the installation will be done within 12 months!”
On the plus side, the 30-year timeframe of the MyPower warranty leads the industry. But Pick My Solar also noted concerns about the unspecified brands it uses for the solar equipment as well as the roof warranty. You can read more here.
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