Google has made its biggest ever bet on renewable technology by pouring in $300 million in a $750 million SolarCity Fund to finance residential solar projects.
Google is setting an example that other leading American companies can follow. The largest 200 corporations in the U.S. have more than $1 trillion in cash on their balance sheets. Investments in solar energy generate returns for corporate investors, offer cost savings for homeowners, create new, local jobs for job seekers and protect the environment from polluting power sources. If more companies follow Google’s lead, we can dramatically reduce our nation’s dependence on polluting power, said Lyndon Rive, CEO of SolarCity.
In case you are wondering, Solar City is the leading solar power and energy efficiency service provider in the US and this significant investment by Google shall help it to finance 25,000 residential solar projects. Another solar energy investment was recently made by IBM to make water and electricity from sunflower dishes.Being hailed as the democratization of electricity, here is how it works: The first step is to obviously own a home. Then you work with SolarCity & design a customized system for your particular roof which guarantees you a lower rate than past electricity bills. For instance, if your normal monthly bill is $200, it could drop to $60 after the installation, plus $100 in the monthly solar rental, yielding a new average monthly bill of $160. Google’s initial investment pays for the system outright through a lease which means that you do not have to pay for the design or placements of the panels with SolarCity installing and maintaining them throughout the life of the lease. At the end of the lease or rental term, one has the option to buy the system back, set it up as a loan, or let SolarCity take it back, no charge.
The panels used, generate renewable, clean electricity and enable the homeowners to pay lower monthly electricity rate without worrying about rising utility bills or extra carbon pollution.
“We’re happy to support SolarCity’s mission to help families reduce their carbon footprint and energy costs,” said Google renewable-energy principal Siddharth Mundra.
The Google deal is structured as a tax-equity transaction, meaning the web search developer gets tax breaks that flow from solar systems financed by the fund.
Google has now committed more than $1.8 billion to renewable energy projects, including wind and solar farms on three continents. This deal, which may have a return as high as 8 percent, is the second time Google has joined hands with SolarCity. It previously set up a $280 million fund backed by Tesla Motors founder Elon Musk.
Earlier this month, Google rival Apple Inc also said it would plow $848 million into a solar-power farm to be used to supply electricity to some of its offices and stores.