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Solar Fleecing: Lucrative Government Contract Awarded to SolarCity

Posted: September 24, 2013 at 8:30 am   /   by

The U.S. government is now the country’s largest rooftop solar customer…and you’re paying for it.  Recently, SolarCity, a California-based solar company, announced that it will lease solar units to supply 7,500 military homes in Hawaii with rooftop solar. The project is part of SolarCity’s SolarStrong Initiative, a five-year, $1 billion dollar strategic solar projects plan to supply solar power to U.S. military homes across the country. SolarCity will own and operate the solar panels, and the private companies that own and manage the housing units will pay SolarCity for the electricity. Of course, the U.S. government provided $1 billion dollars to install these panels, a fact that SolarCity chose to ignore in it’s announcement of the project.

But, the backscratching relationship between the U.S. government and SolarCity is a few years old. Back in September of 2011, the Obama Administration’s Department of Energy awarded SolarCity a sweetheart contract: a $344 million loan guarantee so SolarCity could “double U.S. residential solar installations in a few short years.” As always with these green energy loans, taxpayers were on the hook if SolarCity defaulted (think Solyndra).

Everything appeared to be on track, until Obama’s complex green energy boondoggle began to unravel—and the timing of SolarCity’s loan guarantee is troubling. One week before SolarCity announced the loan guarantee, Solyndra ceased all business activities, filed for Chapter 11 bankruptcy, laid off all of their 1,000+ employees, and left American taxpayers stuck holding a $500 million dollar bill. Just like other rooftop solar installation companies such as SolarCity, the majority of Solyndra’s funding came from the stimulus bill. Surely the Obama Administration knew Solyndra was faltering and taxpayers were going to be stuck with the tab, yet they chose to move forward with the SolarCity Solyndra-esque contract and loan guarantee.

The political fallout from Solyndra cracked Obama’s green energy façade.  In late September 2011, SolarCity announced they lost the U.S. Department of Energy’s loan guarantee. Despite this, the Obama Administration STILL granted SolarCity the sweetheart contract.  (It should be noted, SolarCity is currently under investigation by the Department of Treasury as to whether the company misrepresented the firm’s finances to the government. Is this even a surprise?)

In November, SolarCity announced that the contract would move forward, as a debit and finance deal with Bank of America Merrill Lynch. Why would Bank of America take that risk? The undeniable conclusion is that tax benefits drive this plan. SolarCity and the other major solar companies have routinely found financial partners such as Google, U.S. Bancorp, Credit Suisse and Citigroup. Heck, even Al Gore is a major investor in SolarCity.

Despite losing the loan guarantee, SolarCity still wins big at taxpayer expense by leasing these systems back to the US government.  The $1 billion dollar military projects contract from the government to SolarCiry demonstrates that despite the failure of projects like Solyndra, Obama continues to support his green energy cronies.  When you follow the trail, it’s no surprise groups like Organizing for Action are joining the net metering debate here in Arizona.


  1. Thomas says:

    Comparing SolarCity to Solyndra is a mistake. They are in two different fields. Solyndra failed due to the sharp price decline of PV modules. Which Solyndra manufactured. SolarCity and there customers benefit from the sharp panel decline. They are a downstream PV installer. Not a manufacturer. Here is a Link–Expected-to-Build-More-than-$1-Billion-in-Solar-Projects.aspx  to SolarCity’s press release about SolarStrong. Which clearly states SolarCity did not get the federal load guarantee. Here is a qoute from the CEO of SolarCity from the press release. “The fact that SolarStrong can move forward without a federal loan guarantee is a clear indication that long-term incentives such as the investment tax credit are working.”

    1. Kickflip says:

      Yes the investment tax credits are working alright. They are working to over inflate Solarcity’s value and worth while they systematically lie to the tax payers and their customers. Their systems are NOT free. They are paid for by the stock investors who they have duped, the tax payers who have funded them via over valued systems, and the same banks that were bailed out by the taxpayer during the subprime scandal. How the heck is it that a company that is operating at a 300 million dollar plus loss can still manage to function while being propped up by incentive dollars? Obviously someone is cooking the books. I’m not even going to get into Solarcitiy’s involvement in sub standard system installations, poor orientation and shading issues in over 80% of their installed solar electric systems they while paying its field labor low wages. I’m more concerned as to what these greedy green washing clowns are going to do to what has other wise been a completely viable and productive solar industry. Legitimate installation groups should not have to pay for Elon “the megalomaniac’s” greed and arrogance while he has stolen money and take advantage of folks who just wanted to be green while saving money.

      1. KickflipDon’t mince words, Kickflip . . . tell us what you really think :-)

  2. StevensPoint says:

    Thomas – looks like the article clearly states they lost the loan guarantee. Article states deal moved forward with debit and finance deal with BofA. Which thankfully, Solyndra collapsed when it did or the $1b contract would have moved forward with taxpayer guaranteed funds.

  3. RayBoggs says:

    Don’t forget that SolaCity is currently suing the U.S. Treasury Department. Guess who’s going to pay for that one.

    1. RayBoggs In some cases, we are not only required to pay the defendant’s costs, we’re required to pay the plaintiff’s. There are rules that allow environmental organizations to sue on our dime. So they do. A lot.

Solar Fleecing: Lucrative Government Contract Awarded to SolarCity