SolarCity (SCTY - Snapshot Report) has inked a partnership deal with Conn.-based renewable energy supplier, Viridian Energy, to provide solar energy directly to homeowners at discounted rates unlike local utilities’ companies.
Founded in 2009, Viridian Energy provides green electricity at an affordable price. The company offers high-quality renewable energy that meet or exceed the proposed 2020 federal environmental goal of 20% renewable energy. The company has a well known brand and reputation for high quality service. Currently, the company has more than 230,000 customers in the U.S.
Based in San Mateo, Calif., SolarCity is a leading service solar provider with more than 3,300 employees, 68,000 customers and more than 400 Megawatts (MWs) deployed. The company plays to its strength by providing renewable power at a lower rate than the grid price to residential and commercial markets in the U.S.
While SolarCity offers affordable clean energy, it can only be used during the day. Viridian, on the other hand, allows consumers to use the energy at any time of the day or night. Therefore, the deal will help the consumers to get clean energy whenever they want and at affordable rates.
As per the deal, Viridian will offer SolarCity’s solar products and services to both new and existing customers through its network of independent contractors. This will help SolarCity to increase its already large customer base and better compete with other energy producers like NRG Energy, Inc. (NRG - Analyst Report), Edison International (EIX - Analyst Report) and SunEdison, Inc. (SUNE - Analyst Report).
In return, Viridian Energy will receive a commission from SolarCity for each sale made through the partnership. The new solar offering will initially be available to Viridian customers in New York, New Jersey, Connecticut, Massachusetts, Maryland and Delaware.
In recent times, the utilization of solar energy is rising primarily due to its clean nature and a growing awareness among the masses about its benefits. Also, government incentives and financing options that lower the cost of solar panel installation have led to an increase in solar business.
In fact, solar power is currently the only viable choice for residential consumers seeking an environment-friendly power alternative. Solar power limits the expenses and losses associated with transmission and distribution from large-scale electric plants to end users, unlike other renewable resources, such as hydroelectricity and wind power.
Recently, SolarCity announced that it will provide solar electricity to the town of East Bridgewater for 25 years. The new project will power approximately 350 homes with clean energy at discounted rates.
During the recently reported second quarter, the company’s residential MWs deployed increased 144%; cumulative energy contracts signed and outstanding increased 105% and cumulative customers increased 97% from the year-ago quarter.
SolarCity carries a Zacks Rank #3 (Hold).