Sun Run Biz Model Makes Solar More Affordable

Still dreaming of a solar powered house but think you can't afford it? Even with State and Federal assistance, installing a full solar system on your house can run you upwards of $10,000, depending on your location.

A new collection of companies are taking a lesson from the auto industry and are renting solar panels to consumers. Based out of San Francisco, Sun Run is one of the key companies in this new solar trend.

But just how does it work? Sun Run's solution is the first all-inclusive residential solar electricity package, offered for less than your current electric bill. You will lock in a below-market rate for the electricity the panels generate on your roof, and you can relax knowing that Sun Run will optimize, monitor, and maintain the system they install at no extra cost.

Such a sustainable and affordable option was one we couldn't resist investigating. Sun Run President Nat Kreamer was nice enough to take some time to chat with Building Green TV about his unique company and everything they offer for customers. Keep reading for details about Sun Run's beginnings, actual customer savings, expansion plans, and solar misconceptions. This is one interview you won't want to miss!

BGTV: What was your initial inspiration for starting Sun Run?

Sun Run President Nat Kreamer: My initial inspiration for Sun Run came while I was working on an energy project for Governor Schwarzenegger’s office and the California Department of Water Resources in 2005. During my work there, I recognized opportunity to help families buy solar power in an easy and affordable way and decided to do something about it.

My plans were sidelined temporarily when, as a member of the Navy Reserves, I was deployed to Afghanistan with the U.S. Special Forces. While abroad, my commitment to the Sun Run mission grew as I became increasingly aware of how important clean, affordable, and independent energy is to our health, environment, posterity, and national security.

Returning home, I approached an old friend, Edward Fenster, with the idea. Ed was considering installing solar on his home, but was dissatisfied with the lack of analytical rigor applied to maximizing electricity output. Too many solar systems, he thought, were being installed with too little accountability. The two of us, along with Ed’s Stanford Business School classmate, Lynn Jurich, decided to form Sun Run.

BGTV: What kind of response have you received from consumers and homeowners?

Nat: We’ve received some amazing responses from a wide range of our customers…

For example, Francoise Bouzrat of Redwood City, California, wanted to reduce her family’s dependence on fossil fuels but was concerned about the cost of adopting solar power at home. Francoise found Sun Run offered the most cost-effective way to go solar. We were able to save her more than 66 percent of the upfront system cost and allow her family to achieve their goals without a large investment.

Bill Rutledge, another early Sun Run customer looking to go solar. After running the numbers with one of Sun Run’s installation partners -- Premier Power --Bill realized he could enjoy solar power from Sun Run and save himself a bundle while avoiding any system headaches. After paying the reduced installation fee, prepaying his power bill for 20 years, and planning to exercise his option to purchase the system at the end of the contract, the Rutledges still saved $9,000 upfront and $5,000 in total system costs - equating to 20 years of guaranteed power and maintenance without an electricity bill.

In general, the overall response has been tremendously positive. When you combine unbeatable savings with worry-free service, everybody wins. And we’re seeing more and more people realize that the Sun Run service model is really the easiest and most cost-effective way to go solar at home.

BGTV: Do you hope to expand operations past Northern California?

Nat: Certainly we plan to expand our operations; there are many fantastic markets for solar in California and nationwide. However, providing the best product and service for customers in our initial market is our primary objective. It is important to us that we ensure the integrity of the business and the predictability of our offering. All too often, new companies try to expand too soon and put the quality of their product at risk.

That said, Sun Run is in talks with Southern California installers and we hope to begin offering our affordable solar service in early 2008. Our ability to provide reliable solar power will continue to expand as we develop partnerships with installers across the U.S.

BGTV: Other than cost, what are the perks of using the Sun Run program instead of installing your own panels?

Nat: Hassle-free living is the major perk of our Sun Run installations. Our goal is make it easy for homeowners to opt out of brown power and we’ve made Sun Run the best option for doing that.

We provide an easy-to-use online customer center that shows you how much power you’re using and the amount of carbon you’re offsetting in the environment. By shifting to solar power, you’ll reduce nitrogen oxide, sulfur dioxide, and deadly mercury levels in the environment as well.

Once the system is installed, Sun Run provides monitoring and all required maintenance at no additional cost, as well as guaranteed system performance for 20 years. The system generates a guaranteed amount of electricity, or your money back. Sun Run’s Precision Monitoring Service tracks your electrical output to ensure optimal performance. We monitor local weather coupled with site-specific information in real time to respond promptly if we observe your system producing electricity below our optimal standard.

BGTV: What are the most common misconceptions you hear about solar power?

Nat: I think the most common misconception about solar is that it is not affordable. Many homeowners have an appreciation of consciousness about solar and the threat of climate change, but don’t know what they can do about it – there is still a sense among consumers that clean, reliable solar power is out of their price range.

While it’s true that traditional solar technology is still more costly than conventional energy generation technologies, by leveraging unique finance models developed by Sun Run is we’re able to offer solar power at or below conventional brown power utility rates through our distinctive products and proprietary financial structuring. In addition to competitive pricing, we’re also guaranteeing the power from our installations, which addresses some homeowners lingering concerns about solar’s reliability.