Posted on 01/21/2007 6:41:36 AM PST by Uncledave
January 20, 2007 Is the Sun finally rising on Solar Power? An Interview with Rob Styler of Citizenre (Press Release from Affordable Photovoltaics LLC)
In the past, "going green" usually implied sacrifice. You get to feel good about saving the planet but most "green" products are more expensive than their "dirty" counterparts. With Citizenre, going green can actually save you money. In 1931, Thomas Edison had a conversation with Henry Ford and Harvey Firestone. He said, "I'd put my money on the sun and solar energy. What a source of power! I hope we don't have to wait until oil and coal run out before we tackle that." We have waited 76 years, but an innovative company may have finally found a solution.
The sun supplies enough energy to earth in one hour to supply all of our energy needs for an entire year. But currently solar power produces less than 1/2 of 1% of our residential energy needs. Why?
In the past, solar power has been too expensive and too complicated. To switch to solar, people had to invest their children's college fund or sell their second car. The average consumer pays $40,000 to convert their home to solar-plus you are responsible for the installation, maintaining the equipment, getting permits-who has the time (or the money)?
A company called Citizenre has a bold plan to remove all of the traditional barriers to solar power. They offer: No system purchase. No installation cost. No maintenance. No permit hassles. No performance worries. No rate increases. No way!?
When we first heard about this, we were so intrigued that we contacted the company. It seemed almost too good to be true. Like most innovations, their model is so simple it makes you wonder why no one thought of it before.
You simply pay Citizenre the same rate per kilowatt for power that you used to pay your utility company-but it gets even better. Citizenre will guarantee that your rate per kilowatt will not go up for 25 years. With ever increasing electricity rates, this gives consumers peace of mind and can add up to significant savings. They even have a solar calculator on their website that shows exactly how much you will save over 1, 5, and 25 years. I saved over $13,000 and by using clean energy, it was the equivalent of taking 24 cars off the road or planting 400 trees. Nice.
In the past, "going green" usually implied sacrifice. You get to feel good about saving the planet but most "green" products are more expensive than their "dirty" counterparts. With Citizenre, going green can actually save you money.
This is all made possible by net metering laws that require the utility companies to allow renewable energy to flow into the grid and then allow the consumer to pull that same amount of energy off of the grid at no cost to the consumer. Basically the grid becomes a huge battery. The meter spins backwards during the day when the sun is shining and forwards at night when the consumer pulls that power back off the grid.
These laws were passed because residential energy production was the number one cause of pollution in the US last year, but there are still 9 states that have not joined the party. If you live in Alaska, Tennessee, South Carolina, Mississippi, Alabama, Missouri, Kansas, Nebraska, or South Dakota, the Citizenre Solution is not an option for you yet.
We were still a little skeptical, so we asked Rob Styler, the president of their marketing division, some hard questions.
Q. How can Citizenre afford to install this complete solar system with no upfront cost to the consumer?
A. Because we handle everything ourselves from the solar grade silicon to the final installation, we create savings at each stage of the production. Plus we are building the largest plant for solar power in the world. When you combine our vertical integration with our economies of scale, we are able to produce the final product at half the cost of our competitors.
Q. This sounds like Citizenre required a large amount of money to make all this happen?
A. $650 million.
Q. Now I know why no one did this before you guys. So the customer does not have to give any money to have this complete solar system installed on their house?
A. We require a security deposit, typically only $500, at the time of installation. They get this deposit back, with interest, at the end of the contract. If they don't pay their bill and walk away from the contract, they lose their deposit and we come take the system off their roof. They are also required to pay a monthly rental for the solar energy system.
Q. And how is that rent calculated?
A. By the amount of energy that the system produces.
Q. But they are paying the same rate they were paying before, right?
A. Often it is actually less. We base our rates on the yearly average for their utility. So we have to base our rates on the prior year. Since rates tend to go up each year, many customers will save money on their first bill, and this will only increase as the years pass. We provide a calculator on our website that will tell specifically what they will save with their particular utility and their monthly usage. Many customers save over $10,000 just by switching to the sun. Our whole mission is to help people join the solution and stop being part of the problem.
Q. I like that. How long of a contract do they have to sign?
A. One year, five years, or 25 years. Over 70% of our customers sign the 25-year contract because that locks in their rate for the entire term of the contract. If they sign a shorter contract, their rate is recalculated according to current energy rates at the end of their term.
Q. What happens if I sign a 25-year contract and I want to sell my house in 10 years?
A. You have three options. First, you can ask us to move the system to your new house. We do that one time for free. Second, you can transfer the contract to the new owner. This can potentially add value to your house because if energy rates keep going up like they are and they are 60% higher in 10 years, then your buyer would get a 60% decrease on their energy bill because of your foresight. The final option is that you can contact us, tell us that you just want to end the contract and we will remove the unit. With this third option you do lose your security deposit.
Q. So is my security deposit the most I can lose?
A. Obviously if you don't pay your bill there will be late fees or if one of our franchisees comes out to your house to remove the unit and you greet him with a shot gun and pit bull, we will have to take legal steps to recover our property. But if the customer is cooperative they should have no worries.
Q. Say I want a system on my house. How does it work? What is the process?
A. One of our Independent Ecopreneurs will help you each step of the way. There are some simple questions to answer about your amount of shade, the direction of your roofline, etc. After you sign the contract, a solar engineer will come to the house to design your system.
Q. What if I don't like the design? Am I still obligated to the contract?
A. No. You can back out of the contract with no penalty. You don't even pay the deposit until after you approve the design.
Q. Okay. I like the design. I want the system. What's next?
A. The installation usually takes about half a day. The permit process can take as much as 90 days depending on how cooperative the local utility is, but we handle everything. All you do is sit back and feel good knowing you are using clean energy to power your home.
Q. What happens if something breaks or goes wrong?
A. We have a complete worry free performance guarantee. If the unit ever stops working, one of our franchisees will rush out to fix it for free. The customer has no rental charges until the system is working again so we are motivated to get it fixed fast.
Q. What if my kid hits a baseball through one of the panels?
A. It is just like renting a car or a TV. You are responsible for returning it in good condition. We recommend that customers contact their homeowners insurance to double check that the unit will be covered under their policy. Usually there is not a problem.
Q. Wouldn't I save money in the long run if I just bought the system?
A. Actually, no. Renting can save you a significant amount of money, and it protects you from a large investment risk. We can help the consumer evaluate their options so they can make a solid decision. Our goal is to have solar power producing 25% of our residential energy supply in the year 2025. To make that happen, we removed every barrier we could find to solar entry. We make solar simple.
Q. I understand that your manufacturing plant is not completed yet, is that right?
A. Correct. The first systems will be ready to install in September of 2007.
Q. So why would someone sign up now?
A. First because they lock in their rate as soon as they sign up. Second, they get in line so they can get their system sooner once the plant is producing. Third, it also helps us show the market how many people will go green if we provide an offer that makes sense on every level, including economically. To quote Ghandi, "Be the change that you want to see in the world."
Q. So how does someone sign up?
A. They just go to http://www.affordablephotovoltaics.com and they can sign up for free right now.
For years I said that solar/electric would only become widely available when the electric utility companies figured out a way to meter the sunlight. Their method seems sound.
Or, they could lease the equipment rather than selling it.
bttt
I don't think they would do off grid installations. If they did, I would imagine a huge expense would be a battery system which would drive the cost way up.
Even with that you would still need an additional back up source of energy. Wind, gas generator to avoid going dark after a week of no sun.
This is a money making scheme, and nowhere do I read what happens in 5, 10, and 15 years as the photovoltaic progression yields greater and greater savings and quality, and you are stuck with old technology at a time when new developments far outweigh the old.
My meter rates are not rising at the rate suggested because the power company has to remain competitive against the gas company, and against any new competing technology. Never be first in or last to accept "new" tech.
For the bottom line, when the grid goes out our my local power shuts down, a massive and nationwide group of linemen, are there in all kinds of weather to restore power. A slick roof in bad weather to a local business man or his employees, is another story.
Ugly is as ugly does!
You remain on grid if your panels are working or not.
Solar Panel Bump
Hey, anyone is free to buy and maintain their own PV equipment and upgrade as often as they wish as new technology becomes availabe.
This firm is offering another option and business model, the deal seems plain and up-front, and they're entitled to the future profit if they can later retrofit the system with new technology to further lower cost.
More power to them (so to speak)
In bad weather your solar panels won't be producing anything so it is unlikely you'll be on the roof fixing it during bad weather.
And last but not least, you are still connected to the grid. If your solar system fails, you still have power.
I remember when people had the same attitudes about television antennas, and satellite dishes...
I'm digging my Earth Shoes and tie-dyes out of the closet now...
As I read it, if you want the system off your property within the 25 year period, they come get it, and you lose only a $500 deposit. Frankly, if better, cheaper, more reliant systems came along, they'd probably replace older ones, so they could have more power to sell on the grid.
Only when renewable.solar or whatever IS a profitable business will it thrive.
Current power plants exist for the purpose of making money for their investors;electricity happens to be the product they believe is the best way to make money.
I think you summarize their model pretty well, but I susepct they don't get some special new fee from the govt for taking somebody off the grid. I think they simply pocket whatever tax goodies are available on a state-by-state basis on the equipment.
Also, maybe they can take advantage of the Production Tax Credit given to renewable energy generators. If they can claim all their rooftop installtions as one total "system", then maybe they can claim a PTC benefit. The thing is, they're selling the power at the retail price, whereas other PTC benefactors (eg wind farm owners), sell power at a negotiated rate to the utility in a Power Purchase Agreement. It's around 1/2 the price of retail.
Except that there is no battery. No storage at all of the energy supplied from the home to the grid.
The power utility would have to determine what is the steady-state supply from these solar energy sources to determine to what degree it can stand down any generators.
That's standard inverter / grid connection equipment in a grid-tie system.
Hey, it makes the energy cost of folding drop right to (nearly) nothing.
BTW, the FReeper Folders passed AOA Forums last night.
WooHoo! #56 in the world!
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