Clean Power solar installation prize

Published on June 18th, 2012 | by Zachary Shahan


$10 Million Prize for Companies that Can Install 5,000 New Rooftop Solar Panel Systems for $2/Watt

June 18th, 2012 by  

solar installation prize

As part of the US Department of Energy’s SunShot Initiative, the DOE is offering $10 million prize to companies that can install 5,000 new rooftop solar panel systems for an average price of $2/watt or less.

The first place prize is $7 million, second place is $2 million, and third place is $1 million. The rankings will be based on how low the installers can get their prices.


“Each of the 5,000 required installations must have a power range between 1 and 15 kilowatts. (The average U.S. home used the energy equivalent of 1.3 kilowatts per hour in 2010, according to the U.S. Energy Information Administration.) They must also be installed between Aug. 1, 2012, and Dec. 31, 2014,” LiveScience writes.

“Limits exist on what entries count for the SunShot Prize competition, because the rooftop solar panels must sit on buildings inhabited by humans. That excludes sheds, doghouses and small scale solar farms, but a garage attached to a home would count.”

In addition to the above, the DOE has awarded another $8 million in its latest round of Sunshot announcements, including the $1.5 million awarded to Clean Power Finance that I discussed earlier today and the $500,000 EnergySage received “to develop and implement a web-based solar photovoltaic (PV) comparison-shopping platform that will provide pricing transparency and facilitate open market interactions between property owners and solar PV installers” that I mentioned in our last Solar Energy News roundup. We might be featuring some more of the winners in the coming days as well

Notably, the SunShot Incubator program has been getting $30 in private investment for every $1 of government funding — pretty good, eh?

Image: solar installation via Shutterstock

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About the Author

is tryin' to help society help itself (and other species) with the power of the typed word. He spends most of his time here on CleanTechnica as its director and chief editor, but he's also the president of Important Media and the director/founder of EV Obsession, Solar Love, and Bikocity. Zach is recognized globally as a solar energy, electric car, and energy storage expert. Zach has long-term investments in TSLA, FSLR, SPWR, SEDG, & ABB — after years of covering solar and EVs, he simply has a lot of faith in these particular companies and feels like they are good cleantech companies to invest in.

  • spec9

    People can do this on their own.

  • Bob_Wallace

    David – I’m restarting the discussion here in order to get a wider ‘box’.

    Looking forward to those numbers.  I think I made a large mistake in my model which I posted at 8:21AM.  I left out the $1.85/watt.

    OK, is this not the way your system works?

    You charge $1.85/watt.  For a 5kW system the buyer comes up with $9,250 which covers your costs.

    Then for the next 20 years the buyer pays you $X/mo to cover your profit.  They pay you what they would save the per month based on first year electricity prices.  Their payment is locked down regardless of what happens to electricity prices.

    The advantage to the buyer is that they have to come up with less money up front and are protected against future electricity cost increases.  And at the end of 20 years they own the system and make no more payments to your company.

    The electricity price in South Africa (2010, via web) was 0.33 rand/kWh or about $0.04/kWh.  Correct?

    • Hi Bob

      Thank you for continuing this discussion 🙂

      There are two possibilities:

      1) Charge close to cost price for the system and share the savings with the client over 20 years. In the first year, there are no savings and no additional payment to the installer. But the customer locks in their price – and we make a sale.

      In the second year when the price goes up, say 15%, then this might equate to R12,000 per annum. This R12,000 gets split 50/50. The client saves R6,000. This continues for 20 years.

      2) We are at Grid Parity in South Africa, so theoretically we don’t need to do 1. The PV Grid Tie selling price is substantially (33%!!) higher than $1.85, so one could sell a system to the client which locks their price in for 20 years, and which makes me a profit today.

      3) You have used Eskom’s cost price. What you need to use is the homeowner electricity price, which in the City of Cape Town will be R1.50 per kWh for someone using 1,200 kWh per month. R1.50 per kWh is approx 17.6c per kWh. See my graph at which shows how our prices have changed.

      See last year’s tariff at Add 16% for this year.


      • Bob_Wallace

        OK, I think I’m getting a better feel for your system.

        I still don’t think it correct to say that you are installing solar for $1.85/watt. It’s $1.85 plus future payments.

        In your program the buyer has to come up with less initial money, then pays for the ‘your profit’ part over a number of years with a portion of the money saved on utility bills.

        Without reviewing a number of your contracts and without knowing the unknowable – the future price of electricity – it would be hard to determine if this is a better or ‘not as good’ a deal as borrowing the money from a third party and owning outright, making the loan payments out of utility bill savings.

        It does sound more attractive than the standard lease program in which the customer makes lease payments for 20 years and then may or may not have the option to purchase the system at the end of the lease period.

        As with so many things, the devil is in the details. A careful customer would have to crank through the numbers for all the options to see which works best for them.

        Assuming that your plan is ‘roughly equal’ to outright purchasing and lease
        to buy programs I think it’s a good option to put on the table.

        It would seem to lower the bar for some people who would like solar but are
        made hesitant by the initial cost. And if it gets more solar on roofs and
        cuts fossil fuel use, that’s a good thing.

      • i love that chart. think you’ve dropped that in here before.

        you expecting solar to blow up down there with grid parity this year? haven’t read much about that yet, but think i did notice some mention of it in the EPIA report.

        also, on that graph, would recommend doing some for 25-, 30-, or 40-year time scales as well. clearly, people want their money back sooner, but solar modules are pumping out electricity for 30+ years from what i’ve read, and aren’t many warranted for 25 years now? and just makes for a nicer and even more accurate graph. 😀

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  • “The average U.S. home used the energy equivalent of 1.3 kilowatts per hour in 2010”

    Guys, honestly, you should know better, there’s no such thing as kilowatts per hour, it’s either kilowatt-hours per hour or 1.3kW continuous equvalent.

    The kilowatt is a measure of power, it is an instantaneous measure of an energy flow rate, not a quantity of energy over time. Energy and power are not the same thing.

    This may sound pedantic, but how can we educate the general public when the educators don’t know the difference?

    • I don’t have a problem with this.  The point is clear, unlike many other mash ups of kilowatts and kilowatt-hours.  It’s things that don’t make sense I dislike.

    • sorry, that was in the quote, probably shouldn’t have included that portion, but figured those who new the metrics would get it and those who didn’t wouldn’t really pay any attention anyway.

  • We can install at $1.85 per watt in South Africa at current PV prices and current US$ / SA Exchange Rate. Will the USA make this money available to South African companies for Rooftop PV?

    • Bob_Wallace

      I’m pretty sure you’re out of the running there in South Africa.

      However, if you are actually installing or $1.85/watt you don’t need the extra incentive that this prize is creating in the US.  We need to get down from >$5/watt. 

      Want to tell us how the price got so low in SA so fast?  You’re ahead of Germany, it would seem.

      • It’s a simple philosophy. Make sure you cover your time costs and then share the profit (savings) with the client 50/50 over 20 years. There is also still some product profit, but not a lot.

        • Bob_Wallace

          That doesn’t strike me as honest accounting. If I read you right you’re not installing for $1.85/watt, you’re installing for $1.85 + future payments.

          Now, I don’t want to knock you for offering that deal. It’s basically a ‘lease to own’ after 20 years with a sizable ‘up front’. It would allow someone who doesn’t have enough cash/credit to own outright, but it shouldn’t be sold as a “$1.85” program.

          It might be an excellent model to add to the buy/lease mix, but it’s not $1.85/watt solar.

          • Hi Bob.

            Thanks for this. It is interesting, but my point is that we need to get the industry moving.

            How about $zero cost per Watt? If we are at grid parity and a homeowner is paying $200 per month for their electricity bill, then theoretically the cost per watt is $zero as the homeowner will simply pay the Solar Leasing company $200 per month.

            It’s just in this case the $200 per month will never increase.


          • Bob_Wallace

            I like your model, David.  I just disagree with your statement that you’re installing solar for $1.85/watt.  

            It’s $1.85 plus 20 years of further income to your company.

            Now, I might go with your plan if I couldn’t manage to borrow the money to install a system and make payments with the $200/mo utility bill savings.  At least I’d own the system after 20 years and would get some years of free electricity.  And I would, as  you point out, lock in my monthly costs at $200 rather than watch my monthly go up over time as non-solar owners will “enjoy”.

            $200 a month.  If that’s a real number, $2,400 a year.  $48,000 over 20 years.  Bunch of money.

            Let’s see what outright purchasing might look like.  

            A 5k system at $4.44/watt (current US average) = $22,200.  

            Finance that at 6% for 12 years and your payments are $216.64.

            After 12 years your system is paid for and you get 8 years more free electricity.

            Based on my numbers I’d say you’re getting more like 9% on your loaned money.

            (My assumption of a 5k system might be different than what you are offering.  Feel free to present your numbers.)

          • Interest rates are 10% on average in South Africa.

            Electricity is going up at between 15 and 25% per annum here.

            I’ll send more numbers soon.

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