Pacific Venture Capital, a subsidiary of PG&E, will provide US$60 million in tax equity financing for the installation of 1000 solar power systems on residential and commercial buildings.
The investment will allow SolarCity to use its SolarLease® and power purchase agreement financing options where building owners adopt solar energy with no upfront investment.
In return for providing the upfront investment for the solar power systems, Pacific Venture Capital will receive lease revenues from SolarCity customers, along with the benefits of federal investment tax credits and local rebates for solar energy projects.
The transaction represents the first tax equity financing investment by a utility holding company and the first collaboration between a utility holding company and a solar power provider.
The solar power systems funded under the agreement are expected to be installed this year, most in California but with some systems intended for Arizona and Colorado. SolarCity already has 1700 solar customers in the service area of Pacific Gas & Electric, and 5000 solar customers in total.
“SolarCity strongly believes solar companies and traditional energy industry players must work together if solar power is to become a mainstream source of electricity in America,” explains the company’s CEO Lyndon Rive.
PG&E Corp is the energy-based holding company in San Francisco that is parent company of Pacific Gas & Electric. Its subsidiary, Pacific Venture Capital, was launched in 2000 to make strategic investments in energy businesses.
SolarCity is involved in solar power system design, financing, installation, monitoring and related services.