SolarCity Corp., the nation's largest rooftop photovoltaic developer, is hoping a new day is dawning for solar in Southeastern Pennsylvania.
The San Mateo, Calif., company announced Thursday a bundle of new financing options aimed at customers in the Peco Energy Co. service territory. SolarCity and its competitors typically install their systems on customers' roofs for no money down.
The campaign is aimed at reversing the shrinkage in the Pennsylvania solar market, which went into hibernation after 2011, when federal and state incentives dwindled.
"We have a few hundred customers in Pennsylvania, but it's been slow to develop over time," said Leon Keshishian, SolarCity's regional vice president.
The company says it is scouting for a local operations center and is posting job openings on solarcity.com.
SolarCity, which has 190,000 customers nationwide and claims a third of the residential solar market, has experienced dramatic growth in recent years - the publicly traded firm more than doubled its deployment of solar panels last year. Its chairman is Elon Musk, the CEO of Tesla Motors and Space Exploration Technologies. SolarCity recently announced a partnership with Google Inc. to bankroll $750 million in projects in 14 states, including Pennsylvania.
The rapid expansion has helped the company bring down the cost of installing solar systems, allowing it to offer packages that can compete with conventional utilities, said Jonathan Bass, a SolarCity spokesman.
The company is offering to finance solar installations with loans or under a lease arrangement known as a power purchase agreement (PPA).
Customers who agree to have the systems installed would pay a discounted rate for power. The rates are 15 percent to 20 percent less than what customers currently pay to the utility, said Bass.
The packages are full-service. SolarCity employees install the systems and maintain them, replacing equipment such as inverters over the life of the agreements.
SolarCity also sells any renewable energy credits earned from the solar production, which helps to pay for the financing.
The declining value of the Pennsylvania solar credits became a disincentive for homeowners to buy solar panels on their own. Companies such as SolarCity assume that risk.
"We take on all that," Keshishian said. "It really makes it an easier proposition. The customers don't have to think about anything other than having a system that operates on clean energy and what their net savings are at the end of the day."
Under the agreement, the rates the customer pays SolarCity for power increase by 2.9 percent a year. Customers can fix the rates by choosing a slightly higher initial rate or by making an up-front payment, said Keshishian.
Customers who lock into a 20- or 30-year agreement with a price that escalates annually might consider that Peco's retail price has actually decreased 1 percent since 2010, from 16.32 cents per kilowatt hour to 16.15, according to Peco.
Adjusted for inflation, Peco customers are paying 7.7 percent less than they were in 2010. That price includes the generation and distribution charges.
Gov. Wolf, in his state budget, has proposed spending $50 million to relaunch the PA Sunshine Solar program this year, which would require approval of a skeptical Republican legislature. Under the Rendell administration, that program spurred a solar bonanza from 2009 to 2011. The boom created an oversupply of solar energy credits, driving down the price of those incentives.
Employment in the state's solar industry has slumped since then. According to the Solar Foundation, the industry employed 2,800 people in Pennsylvania in 2014, down 30 percent from 2012.
In New Jersey, by contrast, solar employment has grown 26 percent since 2012, to 7,200 workers. Solar incentives are more generous and New Jersey utility rates are higher, thus easier for solar to compete with.
And, contrary to the sitcom that says it's always sunny in Philadelphia, it's actually sunnier in New Jersey.