Is Sungevity going Bankrupt

It is no secret that the residential solar panel installer business model that was going great guns till last year has suddenly gone bust. The biggest solar panel installer Solarcity was going downhill rapidly till it was rescued at the last minute by Tesla who acquired it in a controversial deal that was criticized in a lot of quarters. SunEdison which used to be another big solar panel installer in the U.S. also went bankrupt. That was not only due to the residential segment but because of the massive uncontrolled expansion that led to the downfall of the once largest renewable energy company in the world.

Sungevity which is one of the 5 largest solar panel installers in US is also facing huge problems as it runs out of cash. A planned fund infusion and reverse merger has failed, which means that the company faces imminent bankruptcy. The company which has already fired a substantial part of its workforce in March has again fired 66 workers as per news report. The company which raised $1 billion in funding over the years has failed to become profitable. The company’s asset light model of outsourcing almost all parts of the solar panel installation work has not worked. Sungevity which used to rely on its software based platforms similar to Facebook has even not worked. The solar panel installation business is notoriously difficult and the main reason for the large size solar panel installers in US was the financing model. As getting tax equity was difficult and the capital required for solar panel installation was quite high, these companies were doing really well providing the crucial financing link from large banks and tax equity providers to rooftop owners.

also read about the largest solar panel installers in India.

Now the business has changed and financing is no longer a hurdle, these solar panel installers in US are finding it very hard to justify their existence. The company had devised a path to profitability, but given the dire straits that the company and the whole industry is in, it looks like another billion dollar bankruptcy for the U.S. solar industry similar to Solyndra, Evergreen Solar and many others.