Overview

Why Choose Sunny Hill Energy?

Solar Lease

Upfront Purchase

Solar Energy FAQ

Benefits of Solar

History of Solar

How Solar Works

“Practically Free” End-Of-Term Buyout

Sunny Hill Energy advertises its Residential Solar Lease to have a “practically free” end-of-term buyout, however we are legally required to use the term “Fair Market Value” in our lease agreement. What is the meaning of “Fair Market Value”? And how does this equate with “practically free”?

Definition

Fair market value (FMV) is defined by the US Supreme Court as “the price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts.”

Today’s technology

The alternative energy industry is fast-paced and growing quickly. Just like the computer and cell phone industries, solar technology is accelerating and prices will eventually fall. Manufacturers and investors are investing 100’s of billions of dollars into the industry, and the new Obama administration is promoting the green economy with massive subsidies. It is very clear that the time of solar technology has come, and we will see substantial price drops within the next 15 years. Anyone who has tried to sell a 10-year old computer knows that, while it can still perform millions of calculations with blinding speed, it has little resale value in the marketplace. Likewise, in 15 years your solar system will continue to produce abundant electricity for your home, but advances in technology will lower its resale value to pennies in the marketplace.

Subsidies are for new panels

Another important factor is the effect subsidies have on value. Solar is affordable today because of large incentives provided at both the State and Federal levels. However, these subsidies are available only once per solar system per meter. This means that “used” solar panels are not eligible to receive incentives, making them far less attractive than brand new ones.

Practical costs

Presently there is no secondary market for “used” panels. However, if one develops, how valuable will your solar panels be in 15 years? Beyond the effects of technological advances and expired subsidies, consider the practical costs associated with obtaining a “used” system: the panels must be removed, transported, tested, refurbished; and the home needs to be repaired (roof, walls, etc.). In 15 years, these costs themselves will offset much or all of the remaining value of the system in the marketplace.

Conclusion

In conclusion, according to the fair market value definition of a willing buyer and willing seller with reasonable knowledge and no compulsion to buy or sell, we believe that your PV solar system will have very little or no value in the market. However, it will carry great value for you as it continues to produce electricity for your household for many more years to come.