Google Invests $280 Million in SolarCity Project Finance Fund

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New project will finance fund for SolarCity Inc., a financier, installer and owner of rooftop photovoltaic systems.

Google Inc. (GOOG) agreed to put $280 million in a new project financing fund for SolarCity Inc., a financier, installer and owner of rooftop photovoltaic systems, in the Internet search engine’s biggest clean-energy investment.

The deal with San Mateo, California-based SolarCity is also Google’s first investment related to distributed solar energy, Rick Needham, the search engine’s director of green business operations, said by telephone yesterday.

The investment is a “quadruple-win” because it will enable more homeowners to lower their energy bills while also shifting to renewable energy, allow SolarCity to expand its business and facilitate wider deployment of solar, Needham said. Mountain View, California-based Google will also make a return on capital upfront, he said, since its investment is supported by the Treasury Department’s cash grants program.

As an alternative to tax credits, the program reimburses investors for 30 percent of project expenditures for solar. The program was created after the 2008 financial crisis to revive spending on clean energy. Projects must begin construction by the end of 2011 to be eligible.

With the looming expiration of the grants program, other corporations with large balance sheets need to “get into this space or else we’ll see project financing struggle,” Lyndon Rive, SolarCity’s chief executive officer, said yesterday in a telephone interview.

“Most solar financing has occurred with traditional banks,” Rive said. Those investors though are “constrained with the amount of capital that can be deployed for distributed power. Google is setting an example other corporate companies will follow,” he said.

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Source: Bloomberg

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  1. Wow! What an amazing step for a huge company like Google to make towards renewable energy. Only if we could get companies out here to promote alternative energy in Virignia we would be better off. It looks like this project is only going to affect the West coast. Either way this could and should start a trend of big companies and renewable energy. Come on Facebook and Microsoft where is your millions of dollars going towards huh?

  2. I could not agree more Joey. I do believe however that the future of the industry should be focussed to consumers and home/business owners. Each of us has the capacity to install some form of RE on our homes and businesses, including PV arrays and small wind turbines. Utility level installations are certainly important and these should continue to happen, but in a volatile energy market where rates are increasing all the time, small scale renewables offers far greater energy security for less far. What do you think Joey?

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