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May 08, 2012

Interview: Going Solar Without Panels

Mosaic model

You want to go solar. But you're a renter. Or you can't afford it. Or there's a giant tree that shades your roof. Well, look no further than "community solar" to solve that problem. Solar Mosaic, a Berkeley company with a staff of 14, lets you put money into a solar project at a third-party location. After a while, you'll see a return on your investment. Lisa Curtis, Solar Mosaic's Community Builder, took a few minutes to answer our questions. Visit Solar Mosaic for more info.

(By the way, keep your eyes peeled for a Sierra Club-Solar Mosaic partnership later this summer.)

What separates Solar Mosaic from the rest of the solar energy sector?

Traditionally, renters, homeowners without the proper roofs, and those without a good credit score have been unable to go solar. Solar Mosaic removes these boundaries and lets everyone benefit from green energy. Warren Buffet just invested $2 billion into a solar farm in California. We make it possible for millions of others to do the same.

Let's say I throw in some money into a solar project through Mosaic. What happens? 

First, you find a project to invest in through us. Then you can invest anywhere between $25 to $25,000. Once enough people have invested in a particular project, it will be built. After it's fully installed and connected to the grid, you will begin receiving a monthly return on that investment. The return will likely be in the 5-10 percent range. 

It seems like Solar Mosaic has targeted community centers so far. Why’s that?

Helping community centers go solar was a compelling way to get people excited about the idea of investing in solar. There is also a strong mission fit with our company that is reflected in the projects we choose. We'll continue community-based projects, but we are excited to expand to include schools, commercial buildings, and residential. 

How cool is that? By doing projects with schools, I wonder if students could sell investments in panels for their school. When I was a kid, I used to sell magazine subscriptions to my neighbors to raise money for my school. 

That's certainly something that could happen down the line. We've done a couple of presentations to high school groups encouraging them to urge their parents to invest in solar projects on local non-profits, but we haven't formalized the relationship in a subscription fashion yet. We haven't done any schools yet, but are very excited to do so soon.

What projects are you working on now?

We just fully funded St. Vincent de Paul's solar project -- or "rooftop solar power plant" -- as our team has begun thinking of them. We're honored to have partnered with over 400 investors and a few incredible organizations to raise more than $350,000 to build on the roofs of The Asian Resource CenterPeople's GroceryShonto Begay's Home, and The Murdoch Community Center.

These beta projects will save these community organizations over $260,000 on their utility bills, create over 2,700 job-hours for local workers, and produce enough clean energy to fully power 12 homes. We've figured it's the carbon equivalent of planting 4,600 trees, assuming they grow for 10 years.

Is this a business model that will grow?  

Estimates say U.S. solar projects will be more than $50 billion over the next five years. But few banks have developed solar financing and many have too much overhead to effectively manage loans.

Online investment marketplaces effectively bring liquidity to financial markets that lack it and serve as an attractive investment opportunity for retail investors. The result has been the rapid growth of a number of online investment platforms. Lending Club and Prosper, for example, are expected to originate over $1 billion in loans this year -- and they are growing 100 percent annually.

Online marketplaces for solar loans have a distinct advantage over these platforms because solar loans are backed by a revenue producing asset -- and counter-parties are paying for a service -- electricity -- they already pay for. This reduces the risk to investors.

Abundance Energy, a company in the UK offers similar investments in wind and solar. Solar Share in Canada offers solar bonds that are somewhat similar, though they have a different business model -- a non-profit cooperative.

We've received a lot of interest from solar developers in the U.S. who want to finance their projects through our marketplace. And we also hope to bring this model to other sectors in the future, like energy efficiency and geothermal. 

Read more about clean-energy solutions.

-- Brian Foley


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