Does an Array have Resale Value?

[l008com]

Do these leased solar panel arrays have any resale value? For example, if the provider was to offer me a deal to buy out the panels, would I be able to resell them? How would I determine the "going rate" for something like that?

This of course is not a hypothetic question, I have a specific system in mind when I ask. I don't have any of the tech specs for the system. I only know it's a 5 year old system, and I have a satellite view where you can get an idea of how big it is.

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Any thoughts?

[littleharbor]

Like a new car, solar panel systems are going to lose substantial value once considered "used". The value placed on the system by the owner is going to be higher than you could expect to sell it for. Very likely the cost of the system components was higher than it would be today, with the price steadily coming down on panels and inverters.

[Ampster]

My daughter purchased a home with a Solar City PPA. The lease gives her an option to purchase the system in two years at "market value". The good news is, as littleharbor said, costs have come down and hopefully the "market value" will reflect that. Also Solar City accumulated significant debt to finance those PPAs and I presume their new parent, Tesla Energy, would wand to reduce that.

[peakbagger]

There is resale value but its lot lower than one would expect and most likely well below what the leasing company has on the books. Any labor expended to install the system has no value and the cost to remove has a negative value. The 30% federal tax credit does not apply to used equipment so that reduces the value to any new owner. The racking system has some value but the roof mounts are probably going to be damaged coming out. Someone has to fix the roof after removing the brackets and guarantee workmanship in case the repairs do not hold. The panels most likely no longer have manufacturers guarantee. Obsolescence of the inverters are also an issue as is if there is specialized software required to configure them. All of the conduit runs are not worth anything. There is some panel efficiency degradation but it minimal. Given the long term history of microinverters I would assume that they are eventually going to start failing and expect getting them swapped out as they fail is going to be on your dime.

I have installed used panels in the past and thy have held up. They were small early generation panels built quite heavy duty. I think the newer larger panels may be less robust and would expect that there is some risk that a panel or two may get damaged between removal and re-installation.

Reportedly the solar business model is to front load the cost of the system with all sorts of overhead so the installed cost is high so the rebate or write off is high. I expect that the carried value on their books is quite higher than what the actual value is. If they sell it for less I think they have to true up between what it on the books versus actual value. They most likely do not want to do it. I expect many of the contracts signed by big solar companies ultimately will blow up but I think the assumption by most firms is make the money and commissions up front and then someone else worry down the line.

So IMHO, the provider is most likely not going to offer you a good deal. On the other hand I have heard of several transactions where owners up for foreclosure sold leased systems off their roofs for cheap on a Craigslist type cash sale. The soon to be former homeowner does not own the equipment and since they are in foreclosure and have trashed their finances anyhow they dont care and its highly unlikely that a leasing company or law enforcement operation would have any way of tracing what are effectively stolen equipment. I have messed around with used equipment on occasion over the years and in general ten cents on dollar is a starting point. In any transaction is the seller motivation more than the buyer?. In the case of foreclosure its the seller but expect in the case of leasing firm its not worth the hassle to sell a system so they arent very motivated.

[J.P.M.]

Still fooling with Vivant I see. Any new episodes to the drama we've missed ?