First Solar Enters US Residential Market, Shrs Jump
Date: 30-Oct-08
Country: US
First Solar, which produces the lowest cost solar cells in the industry, will also make a $25 million equity investment in SolarCity and receive a minority stake in the privately held company that installs the clean power systems in California, Arizona and Oregon.
Tempe, Arizona-based First Solar has focused on larger solar installations rather than the residential markets where installation costs tend to be higher. Germany, with its generous subsidies, has been its largest market.
First Solar shares rose 8.2 percent to $123.44 on the Nasdaq in early trading.
SolarCity said the equity investment was part of $30 million round of financing to fund its expansion. The company offers financing to homeowners and small commercial customers that allows them to avoid high initial costs of installing the systems.
"We are the largest residential installer in the US," SolarCity Chief Executive Lyndon Rive told Reuters. "We have grown on average 200 to 300 percent every year."
SolarCity said its installed costs for the photovoltaic solar systems, which turn sunlight into electricity, are between 14 cents and 25 cents per kilowatt hour, including government subsidies.
The company has installed solar modules made by BP Solar, Evergreen Solar and Kyocera.
The United States recently extended by eight years the tax credits that help bring down the cost of the renewable energy systems and removed a cap on the subsidies for homeowners.
(Reporting by Matt Daily, editing by Dave Zimmerman)
