Solar companies adopted a similar financial strategy as banks during the financial crisis by bundling income streams from solar panel leases, PPAs, and loans to sell them as securities to investors. This approach allowed the companies to receive upfront cash instead of waiting for payments over several years. However, concerns arise about the transparency of passing tax credits to other companies or bundling payments into asset-backed securities. Customers feel neglected post-sale, implying they are viewed as income streams rather than valued clients. Despite leveraging tax credits and securities, these financial tactics did not entirely solve the financial challenges faced by solar companies.
4.5 million households in the U.S. have solar panels on their homes. Most of those customers are happy with it - their electricity bills have just about disappeared, and it's great for the planet. But thousands and thousands of people are really disappointed with what they've been sold. Their panels are more expensive than they should be, and they say it is hard to get someone to come fix them when they break.
It turns out this sometimes crummy customer experience is no accident. It ties back to how big, national solar companies built their businesses in the first place. To entice people to install expensive solar panels, companies developed new financing models which cut upfront costs for customers. And they deployed lots and lots of salespeople to grow their businesses. But in the drive to get more households installing solar panels, consumer costs went up and the focus seemed to shift away from making sure those panels actually worked. All of this left some consumers feeling like they've been sold a lie.
On today's episode, we look into how the residential solar business model has turned some people sour on solar. And we'll try to figure out where the industry could go from here.
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