One of the country’s largest home builders is offering a new financing option that could make it easier for people to afford solar-powered homes.
Calling it the first large-scale program of its kind, Lennar Corp. plans to announce Tuesday a partnership with solar panel manufacturer and installer SunPower Corp. to lease panels rather than requiring home buyers to purchase the technology outright along with the house. Last year, Lennar and SunPower launched a successful test run of the leasing option in 150 Sacramento homes.
Under the program, customers would essentially buy the electricity produced by the solar panels, making monthly payments to SunPower that the company says will average $65 over 10 years, or about $7,800 total.
Previously, the roughly $20,000 cost of the system was automatically folded into the price of a new home and added to the mortgage. The actual out-of-pocket cost was less because of rebates and tax credits.
Still, some buyers balked at the expense, said David Kaiserman, president of Lennar Ventures. He said he expects the leasing program to attract more homeowners to solar-equipped properties.
“Solar’s something most people would like to have but just can’t afford,” said David Kaiserman, president of Lennar Ventures. “Even with state and federal subsidies, people still stretch to come up with the upfront money.”
The Lennar partnership with SunPower is also more convenient than leasing programs through third-party manufacturers and installers, executives said. SunPower adds the panels as the home is being built without dragging the homeowner through the permitting and installation process necessary on an existing structure.
Miami-based Lennar has installed SunPower solar panels on more than 1,700 homes in California since 2006.
The photovoltaic systems, which blend in with surrounding tiles on the roof, are made of monocrystalline cells and can produce an average of about 3.5 kilowatts at any given time, said Matt Brost, general manager of SunPower’s New Home Division.
Under the leasing system, any government incentives associated with the panels are passed along to SunPower. That allows the company to charge homeowners less than their average utility rates.
Participants Dalia and Dan Mask pay $26.90 a month for the electricity produced by the panels on their three-bedroom home in the Kavala community in Rancho Cordova. For those times that they need more energy than the solar system can deliver, they’re still hooked up to the local utility grid. Their last utility bill was just $4.80 and usually comes in under $50, compared with $125 a month when they lived in an apartment.
“The savings is huge,” said Dan Mask, 52. “In the summer time, you’ve got a tremendous amount of sun and we don’t use a tremendous amount of electricity. You could save hundreds on your electricity bill.”
The companies said they expect most customers to renew their lease at the end of the 10-year term, but homeowners may also buy the system, have it removed or turn it off.
Lennar, which may expand the leasing option to states with favorable solar incentives, is considering rollouts throughout California and also in Colorado and New Jersey. The program is already being offered in Lennar communities in Sacramento, Fresno, San Diego and Corona in the Inland Empire.
“The incentives are in such a state of flux that we’re really monitoring it moment by moment,” Kaiserman said. “We’re going to be nimble and evolve the program as incentives continue to evolve.”