SunEdison Changing The Game In Australia

Innovative financing options are now available for those interested in purchasing solar, making solar installation in the home simpler and more affordable.

Industry U.S solar giants have come up with a novel way to expand the market for solar by selling the systems within a financed package of sorts, avoiding huge upfront payments whilst positioning the package as another way of purchasing electricity in a cost-effective way.

Essentially, the consumer pays for the solar system exactly as they pay for electricity from the grid, which would be a charge per kilowatt-hour utilised. America has already somewhat established such a system for selling solar, however it is fairly new within Australia.

Both AGL and Origin Energy are advocating such financial models in order to establish their presence within the solar market. Such models may work in reverse though, where solar giants use it to build presence within the market in order to rival power utilities at a direct level.

SunEdison and SunPower’s plan to cut utility bills

In order to rival Australian utilities at such a level, solar businesses must become full-on-service power retailers. Nonetheless, they must still represent an honest and useful alternative to their clients who are purchasing solar systems upfront while receiving the rest of their power from somewhere else. As such they will need to grow the suite of equipment provided to the consumer beyond just solar into a system that can completely terminate gas bills.

SunEdison, a U.S based solar supplier who offers paying for solar per kWh seems like a perfect player to execute such a great feat. They have just ventured within the Australian market by acquiring Energy Matters Group, who are Australia’s leading wholesalers and retailers of solar power systems and associated equipment.

SunPower seems like another great candidate for the job, as they are the world’s biggest manufacturers of high performance panels. During 2013 the company bought a 40% stake in local Diamond Energy in order to set up a model regarding their global business initiatives to service the energy needs of power consumers wholly.

Even though much hasn’t been heard since the buy over regarding Sunpower/Diamond it’s naturally assumed that they are working hard to launch their own fully serviced solar power offering. SunEdison may have a strong foot within the Australian market, but they are still playing catch-up to SunPower who have purchased a power retailer already.

Another player to shake up the energy market within Australia could be Click Energy, a small market share business who has a solid focus of solar clientele while delivering a great brand would be an awesome acquisition target as well.

SunEdison may build onto their client sales and supply by offering leased renewable rooftops within a retail supplier contract. There is of course just one issue standing in the way of SunEdison and co, which would be that purchasing a solar system relatively simple while ownership proposition allows it to be added onto your electricity bill at the end of the day.

A lot of homes may have access to the $3000-$7000 needed to purchase a solar system through low interest financing options, while one of the big up sells of leasing is the systems performance can be monitored, although such practices may just be the default setting thanks to a change within the Australian standards introduced from July 1st.

Fully serviced solar power system a very attractive option

Let’s say that SunEdison does purchase a fully developed energy services business which would allow their clients to not only cut down their electricity bill but also destroy their gas one. Then the adding on of equipment onto a power bill finance package is much, much more attractive than before.

Being able to tear up a gas bill while at the same time reducing an electricity one needs high performance heaters and air-conditioners, hot water heat-pumps and induction stove-tops. Together with solar PV installations the hurdle of financing options regarding such an investment will be huge, around $25, 000-$40, 000.

In such an instance SunEdison and co will be really aiding a consumer while building their energy services model by offering to take up their whole energy service, which would replace the need for gas and other energy eating devices with cost effective ones instead.

If the consumer is getting together finance of around $3, 000-$7, 000 when buying a solar system, then it’s not all that profitable at the end of the day. Such instances will only get worse over time as the price of solar components drops, subsidies are reduced and all electricians, not just the CEC accredited ones, become installers.

Prices may be sky high right now because of the labour restrictions, which come with the expensive and tiresome CEC accreditation process reducing the amount of electricians who are able to install solar.

If a company manages to upsell a client to the $30, 000-$40, 000 range, then there is major room for better margins to develop as well as a sterling reputation which will come naturally due to in-depth sales and support services offered to each client.

At the end of the day if company’s such as SunEdison wish to lay a solid foundation within the Australian residential marker regarding the power purchase options then their full services model is the only viable option that will be a success. The race is now on between SunEdison and SunPower as to who will announce their offering first.

The Author

Hi, my name is Erin and I am a journalist, content creator and editor working within the Public Relations department at Australian Solar Quotes. I am passionate about the continuously developing renewable energy industry. I am eager to educate others about the benefits and advancements of sustainable living, and I encourage you to join the conversation by leaving a comment below.

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