Google Investment Backs Solar City's Rooftop Photovoltaic PushEngineering360 News Desk | February 26, 2015
Google Inc. is making a $300 million investment to pay for designing and installing at least 25,000 SolarCity Corp. rooftop solar photovoltaic power systems on U.S. homes, reports Bloomberg Business.
Combined with a financing structure from California-based SolarCity, the companies say this investment will result in a new fund worth $750 million, one of the largest ever created for residential solar. This deal, which may have a return on investment as high as 8%, may signal that technology companies can take advantage of investments once limited to banks.
Renewable energy companies increasingly tap into a broader pool of investors, either paying dividends or sheltering cash, due to new financial products that have emerged in the past several years. These produce have helped boost investment in clean energy by around 16% to a record $310 billion last year, according to data compiled by Bloomberg.
These projects are entitled to various tax benefits, including a credit for 30% of the installed cost of a solar power system. Companies, such as SolarCity often can't use the credits and provide them to tax-equity investors. Google, for example, is expected to receive tax breaks that flow from solar systems financed by the fund, Bloomberg says.