I’ll be honest with you: I love solar energy. With a twitter handle like “iluvsolar”, I can hardly pretend to be objective. That said, it doesn’t take a solar zealot to fall in love with a company like Solar Mosaic.
Based in intermittently sunny Oakland, California, Solar Mosaic is a startup with a unique business model that recently scored $4.5 million in venture capital and U.S. government grants. The company pools small donations of money to finance large solar installations on non-residential buildings. It’s one of a growing number of “Benefit Corporations” or “B-corps”, often in the clean tech arena, that aim to solve social and environmental problems.
Capitalizing on the surging popularity of crowdfunding, social media and impact investing, Solar Mosaic has cracked the nut the residential solar industry has been hammering for years—how to make it possible for renters to go solar. Here’s how it works: Customers invest in a project at zero-interest that, together with hundreds of other investments, finances the installation of a solar array on a building in the community. The loan is repaid when the building owner starts saving money on its utility bill – the Asian Resource Center in Oakland, site of the first Solar Mosaic installation, is projected to save $112,684 over the life of the system and, at some point along the way, its 134 backers will get their money back.
Though it’s all very hush hush, Solar Mosaic appears to be gearing up to not only repay its customers, but offer a financial return on their investment. (Their website indicates that the company is currently in a legal “quiet period” as it undergoes a review process with the Securities and Exchange Commission). The prospect of profit could be a game-changer – as it stands, investing at zero-interest feels more like a charitable donation than a savvy investment move, a proposition attractive to only a small segment of die-hard solar aficionados. But if you can get a return…shazam!
Institutional investors are flocking to clean tech because they see it as a safe bet with relatively high returns; soon, anyone with $100 to spare can get in on the act.
At my count, Solar Mosaic leverages at least six social and economic trends – crowdfunding, disdain for big bad banks, impact investing, green consumerism, localization and, oh yeah, the obsession with that little contraption in your hand or on your desk that you spend more time staring at than you do sleeping.
Green consumers want to do the right thing (i.e. support green businesses and groups in their community), but they want it to be fast and easy (i.e. online) and, ideally, lucrative. For that finicky green consumer, the Solar Mosaic model aims to please.
Instead of putting your savings in the hands of a global financial giant with one foot in Pennsylvania shale and the other in Canadian tar sands, you could click your mouse a few times and then sit back and watch the installation of PV panels (paid for by you) on top of the school across the street. If those panels produce more power than the school uses, the surplus feeds the grid and, indirectly, your home. I’d call it a win-win-win-win scenario—a win for the investor, a win for the building owner, a win for the school or group’s constituents, and a win for the planet—but then, I do luv solar.