I am about to buy a home with Solar City panels on it, and deciding to do so was a TOUGH decision, and what I learned is worth listening to. Figuring out if SolarCity will save you money is tricky business indeed.
Situations vary, so first, ask yourself “Will these panels be even partially shaded much of the day?” If the answer is yes, throw up a big red flag. Even partial shading all but destroys production, as this is a series circuit in essence.
If your panels will get sun for a whole bunch of the day, then you may do OK. If you see shading being a problem for a good chunk of the day you probably won't meet their optimistic estimate of production. In the case of my possible new home, they don't. I pulled the SolarCity reports and verified this. But that's just one issue.
While my case might differ from yours, and you will need to do your own homework, here's what I saw in my case. Basically, your lease month per month start low, then get higher each month increasing 2.9% increase per year. My local utility averages a 1.4% increase per year. This was an immediate red flag. This deal is "rear loaded", meaning that while things might look one way to start out, the balance shifts into their favor year by year.
Exacerbating this issue is that panel efficacy falls off a little each year. How much is a topic of debate, and an unknown, so this is the X factor you can't quite define. SolarCity says .5%, most say 1%, and some say 3-4%. In fairness, I modeled things with the 1% number.
What I found after doing a lot of math (utility rates vary by month, tiers of monthly usage, etc.), is that in the long term the only people making money are Solar City. You just provide them with the location to place panels that THEY own so that THEY get all of the government credits.
The math is tedious to figure out, and I suspect that SC banks on you not trying to do so, but I suspect a majority would find little if any savings over the 20-year term.
The most likely scenario seems to be a) Panels under-perform due to overly optimistic projections up front and b) The rear-loaded payments fool someone into thinking they are doing OK to begin with, but due to the SolarCity payments increasing faster than utility rates, and the panel efficacy falling off each year, the equation is reversed somewhere in the middle, meaning steadily worsening losses as you go through the term. This results in a substantial net loss over the entire term.
The panels on the home I'm going to buy are a losing proposition for 2-3 thousand dollars by my best estimate.
I'm still going to buy the home because I love it and the price is great and I'm asking for a few extras in the sale, so I'm good with the deal.
However, if you are considering SolarCity for your home. think it out carefully and do the math.
You may well find that long term it's a losing deal and that you just made your house less desirable to a good segment of home buyers in the future.
Even if you make a little net money over the term, is it worth having THEIR panels on your roof so that they can be the ones making out like bandits?
I'm sure some will find it a good deal, so you enjoy! But to all I say, proceed with caution and do the math.
Bottom Line: No, I would not recommend this to a friend