Does this sound like a stupid idea?

[Kerwin]

First of all, I have zero intention of pursuing this idea. It is not an area of expertise, and I couldn't afford to start even if I did have the expertise. I would be interested in hearing what people thought of the idea though.

The idea is that you install solar panels for free in every house. The residents/homeowner/landlord would then have their electricity bills paid for by solar power. If the solar power does not cover the bill, the homeowner must top it up with the energy company. If the solar power exceeds what was used, your company collects the excess instead of refunding the excess to the homeowner, and that is how the company makes money. You'd be making money on the underutilisation of solar panels.

 

[Uwe (Invoiceberry)]

I've seen similar business models in the past where the consumer gets something at a discounted rate (or for free) in exchange for a "reduced" user experience. I think Amazon used to do that with their Kindle. You could either pay the total price or at a reduced price they show you ads from time to time.

Similarly, there have been business models where you would get a car (rental/leasing) cheaper, but the car had ads on it.

In the end, it really depends on your numbers and how much energy the household would use vs the amount you can sell on the market. Obviously, the price of the solar panels + installation and the market price of electricity are crucial to this business model. Additionally, it's extremely capital intensive as you have to foot the bill to get started and only get money over time. Think about maintenance, etc. too.

 

[Mark T Jones]

I'm pretty sure I've seen it offered with solar - but I've no idea whether it worked or not.

One of the big practical hurdles will be capital - its an extremely capital intensive model with very delayed returns.

I believe there are also technical/legal hurdles regarding changes of ownership in property.

That said, my response to "can this idea work?' Posts always boils down to:

Most ideas can work. Every idea can fail. The difference lies in the execution

 

[Kerwin]

Thank you both. Those are very interesting points.

 

[HFE Signs]

Interesting, I guess what you need to know here is how many people (%) consume less power than what is produced and by how much on average? Also what is the total installation costs including parts and labour.

From that you can work out if the plan is viable.

 

[ChronovaEng]

Having worked with smaller solar panels for my own projects, my gut feeling is that you'd struggle to break even with this idea in the UK. We just don't get enough sunlight to make this approach very profitable!

 

[OMGVape]

Why install on houses? Why not ask farmers to let you install on some of there land? Seems to work for other solar farms.

 

[Chris Ashdown]

As i see it the problem is the Government in that they set the silly buy back rate to the electricity suppliers of pennies
That was ok in the past , but hardly a incentive now
The electricity companies buy in surplus electricity from you for the odd penny and then sell it back to their customers at a massive increase making a great profit, The government should encourage solar power and by setting a reasonable buy back rate for new installation's, would solve some of the energy needs and encourage more installation's

 

[SillyBill]

This has been done for years in the commerical space. At least it was, not sure if commericals stack up now. I had a company offer to kit out my entire factory roof FOC on the same terms quite a number of years ago (maybe 5?). As someone who has never had anything on finance and likes to own everything, personally and business, I didn't ultimately like the fact I would effectively be leasing an asset (all sorts of contractual stuff about what I can/can't do, building sale etc.) on my own roof so didn't go for it. In short, think this'd be done by all the major players if it was viable.