SolarCity says it won`t make the mistake of giving a credit the illusion of being like an AAE again. “[The new product] only deals with the fundamental things of the loan that we should have done rather than credit an AEA,” Rive said. He would not comment on when the new loan would begin, but added that MyPower was a distraction, so it`s a good idea to stop the program before another offer is made. When SolarCity launched its MyPower solar credit product in October 2014, CEO Lyndon Rive said, “This is by far the best product out there.” Considering the finances of each option, the trend towards ownership is sensible. If you lease your system by a third party, share the financial benefits with them, which means that during the term of the contract, you will receive about 20 to 30 percent of the financial benefits of the system. Most of the benefits are available to the third-party provider. On the other hand, if you own your system directly, you don`t need to share the benefits with a third-party owner. This means that you keep 40 to 70 percent of the savings if you buy with a solar loan, depending on the interest rate of your loan. Anyone who has repaid a large loan should be aware that the initial payments only cover interest to an absurd extent. When I paid off my loans at school, it was so irritating that after a few years I decided to repay the loans as quickly as possible. In the end, I probably saved between $10,000 and $15,000. But many are not able or simply not to do the math and are thinking about repaying a loan faster.

If such a person is in a SolarCity contract, it will end up even worse than with many other loans. A paltry amount of their payments will go in the direction of interest. SolarCity MyPower System Cost: $33,150 Lifetime payments (tax credit used): $50,550 (30 years of loan) Avg. Cost per kWh: 17.3 cents (30 years) Avg. Payments: $140 (30 years) Jonathan Bass, VP of Communications at SolarCity, was more exuberant. “It`s the best-performing credit product from a solar energy provider,” he said, noting that even 10 to 15 percent of SolarCity`s volume is far more than the credit products sold by its competitors. “Everything is relative.” The product was a complicated sale. Many potential SolarCity customers are attracted to a lease because they are interested in the savings achieved in the first year compared to their traditional electricity bill, which can provide a solar photovoltaic installation, Litvak noted.

With MyPower, clients, as with other solar loans, had to sell their federal funds for investment tax credits or pay some kind of penalty. Where SolarCity has put itself in a corner The problem for SolarCity is that it has built its business on financing solar installations itself. Leases are held by SolarCity and can be crushed to different financing parts, with SolarCity retaining the residual value. The result is very high margins – provided that leases and credits work as a contractual arrangement — and generate a lot of value for SolarCity shareholders. That is what she tried to do with credit. SolarCity (NASDAQ:SCTY. DL) could see this transition coming and at the end of 2014 it introduced a credit product called MyPower. Like a solar rental, it associated the customer`s payment with the energy production of a solar installation, but unlike a lease agreement, the owner owned the system as soon as the loan was repaid.

But last week, MyPower closed after the product couldn`t take off.