Online solar shoppers are choosing direct ownership over leases and PPAs


The solar industry thrives on data. Falling costs per watt, cell and panel efficiencies, market sizes – all are key metrics to understand the rise of solar technology.

Today EnergySage added to that body of knowledge with the release of aggregated data from the sale of over 1,000 solar PV systems by homeowners, small businesses and non-profits across the United States over a 12-month period from July 2014 through June 2015.

The company's Solar Marketplace Intel Report shows that online shoppers using the service behave very differently than the national average in one key aspect. Around 90% of Solar Marketplace sales are to customers who will own their PV systems, through either loans or direct purchases, instead of participating in third-party owned arrangements such as leases and power purchase agreements. This compares to only around 40% nationally.

The breakdown of direct purchases versus loans is unclear, as many customers procure their loan products outside the marketplace.

EnergySage CEO Vikram Aggarwal notes that the direct ownership versus third-party owned number may be influenced by the absence of third-party solar pioneer SolarCity, which is by far the largest residential solar installer in the United States. Aggarwal also says that if SolarCity were to join, this would likely bring up the percentage of third-party solar sold through his site.

However, he also notes that homeowners are able to realize much higher portion of the value of a PV system through most loan products as opposed to a third-party arrangement, and that direct ownership brings 100% retention of value.

“We are clearly showing the economics of buying versus leasing,” explains Aggarwal. “For some consumers leasing is absolutely the right decision. But in a transparent industry, you can see why consumers would select a loan option versus a lease option.”

Despite SolarCity's absence, EnergySage does offer quotes from installers that use Sunrun's third-party options, as well as quotes from SunPower installers. Aggarwal says that he expects NRG and SunEdison to join the platform soon.

Aggarwal also notes that a small portion of customers to the Solar Marketplace site have already chosen a PV installer, but are on the site to shop for loan products. Due to this demand, EnergySage is currently building out a portion of the site to sell these customers loans directly.

The data presented goes well beyond direct ownership versus third-party solar. EnergySage offers averages for sales prices, prices per watt, system sizes and a host of other data points.

This includes data on customer electricity usage and the percentage of electricity demand met with solar, which Aggarwal notes is not offered in other analyses. EnergySage's customers tend to have nearly double the electricity bills versus the national average at $195 per month in the first half of 2015.

These customers are typically attempting to offset their entire electricity use with PV systems. In the first half of 2015, EnergySage customers purchased PV arrays that will offest an average of 86% of their electricity use, which meant an average system size of 7.9 kW.

This system size cannot be compared exactly to other national data for residential PV as not all of EnergySage's customers are homeowners. However, as more than 95% are, it is still clear that homeowners using the EnergySage marketplace are buying larger PV systems than the national average, which is around 6 kW.

Aggarwal claims that the prices being paid by customers on the Solar Marketplace are lower than the national average, reporting an average price of $3.79 per watt in the first half of 2015. This could not be verified as EnergySage says that other reports such as GTM Research's Solar Market Insight count prices differently. However, he notes that his company's average hides a huge range of prices, and notes that most customers do not choose the lowest priced option.

“There is a big price dispersion, and if people get multiple quotes, that is where comparison shopping can help them get the best deal,” says Aggarwal. “It pays to shop around.”

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