With the UK’s Financial Conduct Authority (FCA) authorizing what is believed to be the first time a company can provide solar panels and batteries on a subscription model — without subscribers having to pay a lump sum — the stage could to create a new boom in solar subscription services. This will provide useful competition in the market and a new arena for mining technology investors.
UK startups Sunsave got the green light from FCA this week, with its proposal to provide solar panels and batteries in a subscription model. The Oxford-based startup has also raised a £5.4 million ($6.7 million) seed round led by impact-driven VC Norrsken, as well as previous investors IPGL, Plug and Play and angel investor Stuart Rose (chairman of Asda), Michael Spencer (founder of Nex Group/ICAP), Roland Rudd (founder of Finsbury) and Bill Nussey (author of ‘Freeing Energy’). It has now raised £9.2 million ($11.5 million) in total in its 18 months of existence.
Sunsave follows a trend from US and continental European companies. Enpal in Germany is a major player in solar energy, with six years on the market and big revenues. Enpal is backed by SoftBank and June lifted up $464 million in debt financing to finance the leasing business.
Then there’s YC-backed SolarMente in Spain, which raised €50 million in debt and equity from PE firm GNE Finance in April.
Meanwhile, in the US, the model is slightly different, with many companies offering solar subscriptions and multi-year leases. However, the market is increasingly turning to subscription, and includes big players such as e.g Sunrunwhich is listed on Nasdaq.
In the UK, ‘solar leasing’ has been the dominant model under the feed-in tariff regime, but customers don’t end up owning the solar panels on their own roof and can’t easily get out of leases. It’s a bum deal and consumers know it. The result has been extremely slow uptake of domestic solar in the UK
Sunsave thus appears to be following the US and continental European models—now approved by regulators—of the flexible loan-based subscription model. This means that the customer fully owns the system and there are no fees or penalties for early repayment.
The news fires the starting gun on other solar subscription startups that could even operate on microgrids and sell the energy back to other larger suppliers.
