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Summary:

Following yesterday’s cloudy performance by solar stocks, this morning some solar players announced a deal that could help them weather the storm. Residential solar designer and installer Akeena is teaming up with residential solar financier Sun Run. The partnership will connect Akeena’s “LEGO-like” Andalay panel system […]

Following yesterday’s cloudy performance by solar stocks, this morning some solar players announced a deal that could help them weather the storm. Residential solar designer and installer Akeena is teaming up with residential solar financier Sun Run. The partnership will connect Akeena’s “LEGO-like” Andalay panel system with Sun Run’s power purchase agreement financing, maintenance and monitoring services.

Los Gatos, Calif.-based Akeena, one of the larger solar installers, has invested in creating an integrated racking and mounting system, and had previously not been using power purchase agreements to sell its systems. San Francisco-based Sun Run has developed a business selling fixed power rates amid rising energy costs, focusing on the residential market. Using PPAs to sell solar is popular in the commercial business — Tioga Energy, MMA Renewables and Sun Edison all use a PPA model — but not so in the residential space. Sun Run’s main competitor, SolarCity, offers solar lease agreements, allowing the startup to offer residential solar with no money down.

The deal with Sun Run could make Akeena’s product more attractive by deferring the high upfront cost, usually more than $18,000, over many years. Like so many solar installers, Akeena is subject to slim margins and the company announced yesterday that its losses widened to $4.6 million last quarter and that it is laying off some workers. The company also warned that it sees weaker demand for the rest of the year.

This kind of market cooperation could lead to healthy consolidation. As Nat Bullard, an analyst at New Energy Finance, told us yesterday, “It’s a market with a great number of players whose margins are being squeezed.” As separate startups innovate and optimize different parts of the solar value chain each one can offer ways to help cut costs.

  1. [...] are on the up and up. Last week Akeena Solar, a residential solar installer, partnered with Sun Run, a solar financier, to make PPAs available to its customers. Using PPAs to sell solar is far more [...]

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  2. [...] to buy the electricity coming off their roof from a third party that owns the panels (like Akeena Solar which SunRun partnered with last month) — this arrangement, called a power purchase agreement, helps defer the upfront [...]

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  3. [...] and will stick to a straight-up transaction model for home solar systems. Startups like Solar City, Sun Run and Akeena have been trying to innovate on the business side of residential solar to get rid of the high [...]

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