Posted on 07/12/2014 7:57:00 AM PDT by afraidfortherepublic
The US government has been pushing the idea of home solar panels for quite a while now, giving the industry a significant, additional nudge when the current federal subsidy program was generously expanded in 2008. The idea behind this was that if homeowners wanted to save some money on their energy bill by using solar power, they could receive a 30% subsidy to help cover the costs. Sounds pretty sweet, eh?
Well, when the government is giving away taxpayer cash, plenty of people will line up to get it… and it’s not always those who were intended to benefit. This is apparently going on in terms of this solar panel subsidy scheme as well, with at least one company figuring out a way to profit from it. SolarCity came up with a plan where homeowners could lease the solar panels over the long term rather than having to pony up the cash up front. The sales pitch was that this would allow them to start earning those big savings on their utility bills right away, rather than having to wait to save up or pay off the cash to purchase them.
As the following report shows, this freed up SolarCity to pocket the government subsidy money since the homeowner never actually took possession of the panels.
SolarCity has been accused of taking advantage of subsidies from the US government. Instead of these subsidies going to the consumer, SolarCity has been claiming them. SolarCity takes away a 30% tax credit while leasing solar panels to its customers. Most customers are unaware of the complicated laws that regulate solar policies.This is turning out to be a better deal for the installer than for the consumer it was intended to benefit. But surely somebody else must have their snouts up to the Washington trough. So who else is benefitting, aside from the “green technology” installers? Well, the Chinese seem to be doing well.Solar City has come under frequent criticism of its unethical behavior in milking hundreds of millions of dollars in subsidies from the USA government. Its sister concern Tesla, run by Elon Musk, is also facing the same criticism. One of the biggest issue that has come up with Solar City is the fact that it claims a 30% tax credit on its solar installation which is meant for its customers. It takes away the 30% tax credit, while leasing the solar panels to its customers who may face high electricity bills and do not get any share of the subsidy. Most customers are ignorant about the complicated laws and regulations that make up the solar policies. They are happy with whatever small savings that SolarCity offers them. USA’s federal and state governments have a lengthy complex procedure for approving solar subsidies. Compared to USA, Germany has a streamlined fast procedure where the individual customers get all the benefits. Unlike Germany in the USA, the installers and developers like SolarCity have popularized the PPA and leasing model which allows them to make money while the customers usually get the raw end of the deal.
The deal actually manages to get worse for the homeowners if they plan on selling their homes. If they wind up in one of these long term solar panel lease deals (the “free” ones mentioned above), potential buyers are less than eager to sign on to the owner’s lease arrangement as part of the conditions for purchasing the home. The lack of savings keeps on rolling!One of the largest solar-system installers in the U.S., SolarCity Corp., uses the LLC strategy and currently buys a majority of its solar panels from the low-cost Chinese supplier, Yingli. Thus when President Obama said that we must subsidize our solar industry to remain competitive with the Chinese, it would have been more accurate to say that we subsidize Wall Street to create employee-less corporations that buy and install Chinese solar panels in the U.S. Wall Street and consumers understand that free markets are borderless; Washington does not.
Just last week, the U.S. International Trade Commission found the Chinese solar industry guilty of “dumping” solar panels in the U.S. Tariffs are likely to be levied against Yingli and others. Here then, is a practical guide to the Obama administration’s nonsensical solar policy: Washington gives tax breaks to Wall Street to fund LLCs that buy solar panels from the Chinese to “help” the American solar industry, while the ITC threatens to levy a tariff on those solar panels, which would raise the price of solar energy to U.S. homeowners. In short, Wall Street pockets the money and consumers get higher solar-energy prices.
Once the subsidy genie is out of the bottle, it’s nearly impossible to put back in. And the cash is not going to the people who were supposed to benefit from it while they helped to save the planet. But don’t worry… Uncle Sam will send you the bill next April.
Big Obama donors????
People....you gotta read the fine print. I cannot stress that enough.
Back in my military days in 1974 overseas with a pregnant wife, a skeezball Metropolitan Life insurance salesman got hold of me. I was overdue for a COT remote tour because of my AFSC and he guilt-tripped me into taking a life insurance policy because of the wife/baby coming, etc. I was young and stupid for sure, and he did a number on me.
He kept talking about “at age 65, you get all that $15,000 !” So what could be wrong with that? After I mustered out in 1976 and 3 years later after college I finally read that policy. He was talking about “when the policy reaches age 65!” Yep, dumbass me - I deserved it - every $33.65 a month (I’ll remember that number to the day I die). I cancelled in 1980, and I got $740 of my money back.
To this very day, when I hear Metropolitan, Met Life, or see that damned Snoopy Dog, I spit and cuss like a sailor.
Then again, maybe SolarCity should be commended for figuring out a way to work the system to maximize profit. Ever wonder whose pocket the factory rebates to car dealers wind up in?
The article did not provide enough information to show what it claimed.
I mean, in general all subsidies and tax credits that target specific items tend to enrich the people who PROVIDE the items rather than the people who use the items. That is because of utility cost.
A person who wants something will determine what they think that item is worth. “worth” is based on what the person is willing to give up to have the item, and is somewhat independent of the cost of an item (I say “somewhat” because “worth” is highly subjective, and the perception of value is driven by the cost of the item — if you see an item discounted often enough, you will lower your “worth” for that item accordingly).
So, if I think a college education is worth $10,000 a year, that is what I am willing to pay. If the college wants the $10,000 from me, they need to price the experience at no more than $10,000.
Now, the government steps in and offers $2500. If it is clear to me that I am getting $2500, I factor that into my “worth” — after all, if it was “worth” $10,000 to me, it still is. I pay $10,000 out of my pocket, and can use the $2500 in “free” money from government to cover additional costs, so it isn’t really like I’m paying for it.
So college increases their cost by like $2000, and I feel like I got a $500 deduction, but the college gets most of the tax dollars. Which is why we have a $2500 credit, so Obama could pay off his liberal college buddies.
Anyway, solar companies know this, and when they sell you a product, they include ALL the known subsidies and credits you might get, and give you a “bottom line” cost. If you like that bottom-line cost, you make the purchase, which is for thousands more, knowing you will get the subsidies. Which go directly to the company.
If a company leases you the panels, and takes the credit — it may still be the same, as they could have lowered the lease cost based on the credit, to reach your price point. And if they didn’t, it was because you were willing to pay more for the lease.
In the end, you pay what you are willing to pay, the company gets as much money as it can from you, and any government subsidy is mostly wasted in the transaction — except for perception.
Because you perceive a greater “value” (what you thought it was worth to you, PLUS the additional subsidy/credit raising the total price), you think you are getting a “bargain”. Panels were worth $10,000 to me, but because of the credit, I can actually get $13,000 panels, which are clearly better than the $10,000 I would have been willing to buy.
So credits/subsidies still direct our purchasing, or get us to do things, but they don’t really benefit us monetarily, but the providers.
Besides the fine print, do the math. $33.65 is $400 per year.
Placing the cash in a Mason Jar gets you $15,000 in 37.5 years with no interest. Who need Met-Life?
Such were the days before the term life industry began marking widely. The salesmen were trading on ignorance.
BTW, I fell for something similar around the same time period.
Can’t tell you much how they are harrassing the public with this scam
NOVEMBER 25, 2013 4:00 AM
Subsidizing SolarCity
A California solar-panel company could be another Solyndra in the making.
San Mateo–based SolarCity Corporation, whose financial backers include prominent Obama supporters such as Al Gore and Tesla Motors CEO Elon Musk, has received millions of dollars in federal tax credits since 2008, despite posting a net loss of more than $300 million over that same period.
Earlier this week, Senator Jeff Sessions (R., Ala.), ranking member on the Senate Budget Committee, sent a letter to U.S. Treasury secretary Jack Lew to express “concern that SolarCity might become the next Solyndra — a company propped on the back of the taxpayers, not the product produced.”
http://www.nationalreview.com/article/364748/subsidizing-solarcity-andrew-stiles
SolarCity Corp (NASDAQ:SCTY) EVP Seth R. Weissman unloaded 7,000 shares of SolarCity Corp stock in a transaction that occurred on Tuesday, July 8th. The shares were sold at an average price of $65.15, for a total value of $456,050.00. Following the sale, the executive vice president now directly owns 158,777 shares in the company, valued at approximately $10,344,322. The transaction was disclosed in a filing with the SEC, which can be accessed through this link.
A number of analysts have recently weighed in on SCTY shares. Analysts at Canaccord Genuity initiated coverage on shares of SolarCity Corp in a research note on Wednesday, July 2nd. They set a “buy” rating and a $94.00 price target on the stock. Separately, analysts at Roth Capital raised their price target on shares of SolarCity Corp from $65.00 to $80.00 in a research note on Wednesday, June 18th. Finally, analysts at Robert W. Baird raised their price target on shares of SolarCity Corp from $75.00 to $80.00 in a research note on Friday, May 9th. One research analyst has rated the stock with a hold rating and seven have given a buy rating to the company. SolarCity Corp has a consensus rating of “Buy” and a consensus target price of $80.89.
Shares of SolarCity Corp (NASDAQ:SCTY) opened at 65.58 on Friday. SolarCity Corp has a 1-year low of $28.31 and a 1-year high of $88.35. The stock’s 50-day moving average is $60.03 and its 200-day moving average is $63.93. The company’s market cap is $6.040 billion.
I had a lot of other things on my mind at the time with the baby coming and what I was going to have to do getting sent off to Peshawar, or Incirlik or similar.
The biggest negatives for the solar panel lease game:
1. If you sell your home, the new owner must accept the lease. This limits re-sale customer pool.
2. You must accept a 2.9% annual increase in your electric bill, regardless of market conditions. The pitch: look how fast you electric bill is rising the past few years. The risk: the increases in rates may have reached a peak for a while, but you signed up for 2.9% increase while your neighbor’s bill goes down.
of course they are, that’s why they are in business
Visit any big city.
The tallest buildings are banks or life insurance companies.
Wait’ll Obama gets his billions for the kids at the border-another huge payday for his cronies. Think Solyndra.
I just emailed this to a fellow we know. He was bragging about how smart his in laws were for signing up with this outfit.
“As the following report shows, this freed up SolarCity to pocket the government subsidy money since the homeowner never actually took possession of the panels.
SolarCity has been accused of taking advantage of subsidies from the US government. Instead of these subsidies going to the consumer, SolarCity has been claiming them. SolarCity takes away a 30% tax credit while leasing solar panels to its customers. Most customers are unaware of the complicated laws that regulate solar policies.
Solar City has come under frequent criticism of its unethical behavior in milking hundreds of millions of dollars in subsidies from the USA government. Its sister concern Tesla, run by Elon Musk, is also facing the same criticism. One of the biggest issue that has come up with Solar City is the fact that it claims a 30% tax credit on its solar installation which is meant for its customers. It takes away the 30% tax credit, while leasing the solar panels to its customers who may face high electricity bills and do not get any share of the subsidy. Most customers are ignorant about the complicated laws and regulations that make up the solar policies. They are happy with whatever small savings that SolarCity offers them. USA’s federal and state governments have a lengthy complex procedure for approving solar subsidies. Compared to USA, Germany has a streamlined fast procedure where the individual customers get all the benefits. Unlike Germany in the USA, the installers and developers like SolarCity have popularized the PPA and leasing model which allows them to make money while the customers usually get the raw end of the deal.
“1. If you sell your home, the new owner must accept the lease. This limits re-sale customer pool.”
I for one would like to see this challenged in court. For example, the initial homeowner could simply dismantle the solar installation, deliver same to the “leasing” company, and photograph it along the way.
Bottom line as I understand it: solar never pays, without government subsidies. And most consumers need the extra push of monthly payments, be they leases or time payments on the initial cost of installation.
Plus you can’t watch TV without some insurance company commercial popping up on nearly every channel. They pay huge amounts for that airtime.
Govt regs have caused insurance companies to rake in the green largesse.
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