The problem, as they saw it, was a matter of finance, not technology. Stanford Business School friends Lynn Jurich and Ed Fenster solved the basic problem in residential solar energy — upfront cost — by offering homeowners fixed leases on all the equipment they need to get off the grid. Their San Francisco firm, SunRun, gives homeowners guaranteed fixed energy costs for twenty years along with free maintenance with little or no initial investment.
The customer signs a long-term agreement, which sets a fixed cost for power. If the house is sold, the contract passes on to the next owner. At the end of the term the owner can renew it, buy the system outright, or have it removed. With thousands of homeowners signing long-term agreements, SunRun Is actually developing a new type of electric utility with generating capacity spread thinly across the country. Like all utilities, it enjoys predictable revenues from large numbers of customers. The difference is that SunRun never has to buy fuel for power generation, and it will never be affected by environmental regulations.
SunRun’s message emphasizes “how you can save $50,000 over the life on the contract and avoid having your utility bills raised,” says Jurich. “Because of the recession there’s been a rush toward getting this type of certainty, this kind of predictability when it comes to costs. In that way, we’ve been helped by the downturn.” SunRun’s customer base has increased by over four hundred percent in 2010 and has raised nearly $ 100 million in financing.
SunRun is one of fifty companies interviewed for the Wall Street Journal best-seller: Spend Shift: How the Post-Crisis Values Revolution is Changing the Way We Buy, Sell and Live.