New data suggests that in the second half of 2017 Sunrun will overtake SolarCity as the nation’s top third-party solar financier. The news comes as the solar industry continues to see a shakeup as the market matures, companies adopt different strategies and pricing uncertainty comes into play.
In GTM Research’s latest report, U.S. Residential Solar Finance Update, H2 2017, the company predicted Sunrun will overtake SolarCity as the top third-party ownership (TPO) financing provider in the residential solar market by late 2017. The report attributes the change to a number of things, including Tesla’s acquisition of SolarCity and Sunrun’s continued growth.
“Through the first half of the year, Sunrun narrowly missed the top spot in the TPO market with 27 percent market share -- up considerably from its 18 percent market share in 2016, but just behind SolarCity’s 31 percent share,” wrote GTM’s Allison Mond about the new research. “That 4 percent difference between SolarCity and Sunrun equated to just 19 megawatts over two quarters.”
In the third quarter that’s seemed to flip in Sunrun’s favor. The company financed 80 megawatts rooftop solar in the quarter while SolarCity compared to the no more than 59 megawatts of solar power that SolarCity financed in the quarter. Mond observed that Sunrun financed more than 20 megawatts more of solar than SolarCity in the quarter.
Sunrun hasn’t totally supplanted SolarCity in terms of total solar installations, however. Overall SolarCity installed 109 megawatts in the third quarter, including its commercial solar installations. Sunrun installed 90 megawatts in the quarter. Vivint Solar, the third largest installer, installed 47 megawatts of solar in the quarter, GTM stated.
There are a couple of things at play. SolarCity announced earlier this year that it was changing sales tactics and would no longer knock on doors—as has Vivint Solar. Though SolarCity was a pioneer of TPO financing it’s also moving away from the practice in order to increase the amount of cash it has as opposed to debt from financed rooftop solar.
This also is the first year since 2011 that cash and loans were used to purchase solar systems in more than leases and PPAs were used. GTM attributed the change to the availability of loan products, fewer TPO suppliers and SolarCity’s move away from TPO.Tweet