It appears that Wall Street may finally realize that the phony SolarCity success story is coming to an end. Back in March I highlighted this Fox News/Watchdog.org report detailing all the government freebies they receive.
SolarCity’s own financial report said, “If, for any reason, we are unable to finance solar energy systems through tax-advantaged structures … we may no longer be able to provide solar energy systems to new customers on an economically viable basis.”
It appears that investors and industry experts have woken up from this taxpayer-funded fairy tale. Shares fell over 7 percent after a report that the company expects to lose over $1 billion. According to Energy Daily’s recent article, “Wall Street punishes SolarCity for losses, questions business model,” “SolarCity has been a Wall Street darling, with many analysts praising its business model in which homeowners can avoid the large up-front costs of installing solar panels by signing a 20-year lease and a power purchase agreement (PPA).”
Given that SolarCity’s business model is like that of a traveling snake oil salesman. You can sucker a town for just so long until they realize you’re a crook. Then, you move on to another town. SolarCity’s model of leasing equipment sounds great to the consumer, but then they realize that all of the tax credits we hear about for energy-efficient homes belong to the owner of the equipment (SolarCity).
More from Energy Daily’s report:
[T]he company’s lease model depends largely on uninformed customers buying the unattractive lease/PPA products,” the Casual Analyst wrote in a note Thursday. “The supply of this class of customers is likely to be plentiful as the company targets new geographies, but we expect the supply of gullible customers to decline as solar penetration increases. Over time, the lease model will in large part give way to loans and other more customer friendly products.
Given that SolarCity’s business model relies on gullible customers and government hand-outs, it’s time for the angry townspeople and taxpayers to rise up and close the book on this fairy tale.