Tesla announced 28 percent of SolarCity’s Q4 solar deployments were purchased by customers. Presumably, that percentage is even higher for residential installations. Despite SolarCity’s declining market share, the company still accounts for about one-quarter of all residential solar installed. Any major changes to its strategy will have an impact on the market -- and we’re already seeing that impact.
Tesla said it will continue transitioning to direct sales in order to generate more cash upfront. Vivint Solar is also making this shift, albeit more slowly and still primarily in markets without legal third-party ownership.
The second (and somewhat overlapping) reason is California. The state fell to 36 percent third-party ownership in Q4, down from almost half the market at the beginning of the year and as high as 75 percent in mid-2013. Small local installers, as in most other states, have long preferred cash sales. The biggest change happening in California, however, is that larger installers like SolarCity, Sunrun, and Sungevity are moving to cash more quickly there than anywhere else.
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