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Cutting down solar costs with satellite imagery

Sungevity, which offers a Web-based system for evaluating the solar potential for homes through satellite data, wants to be the Dell of solar panels.

Danny Kennedy may have come up with a way to make solar panels an impulse buy.

Sungevity, Kennedy's company, has come up with a Web-based system for evaluating the solar potential for a given home through satellite data. Customers log onto Sungevity's site and provide an address and some information about their monthly electrical bill.

Within 24 hours, the company sends customers a quote for installing a solar system, an estimate of how much the system will save them over 25 years, the prospective increase in the value of their home, and simulated imagery of what their home might look like after solar panels are installed. Traditionally, the process that provides all that information takes days and a physical examination of the roof.

"We do all that (the calculations for preparing the estimate) in about 10 to 15 minutes," he said.

Your solar system, Sir! Click a few buttons and Sungevity gives you an accurate quote for a solar system. It cuts out a lot of the time and money of putting these in. Sungevity

And in a few more clicks, customers can schedule an appointment and put a deposit down on a solar system.

I did an estimate on my grandmother's home. The system would provide 25 percent of the home's power and cost $7,511 after rebates. It would save $27,360 in electrical cost over time, according to the quote. They gave the option of paying upfront or through installments. Visa, Mastercard, and American Express are accepted for the deposit. The quote came back two hours after I handed over the address.

Reducing a complex sale into a quick online exchange--the same trick that propelled Dell to the front of the PC world--helps reduce one of the nagging costs of the solar world: the install expenses. Installation costs come to around roughly half of the cost of a solar system. Sharp, Akeena, and other companies have tried to reduce installation costs through prefabricated frames for solar panels. Others have developed roof tiles with solar cells built in. SolarCity, meanwhile, has aggressively used software to coordinate solar panel deliveries and installations to cut down on the number of trips electricians and contractors have to make. SolarCity also leases solar panels.

Sungevity's software essentially eliminates the money and time it takes for an installer to drive out to someone's house, climb on top of it, and take a bunch of measurements to prepare an estimate. Only 10 percent of those visits lead to a sale, Kennedy added.

"You introduce errors when you put a guy on the roof."
--Danny Kennedy, Sungevity

In all, Sungevity can cut the cost of a solar system by around 10 percent, he said, and cut out 80 percent of the on-site estimates. (Like Solar City, Sungevity also uses software to coordinate installations.)

The company's secret sauce is a trigonometry-heavy application that can take satellite imagery and create a 3D model of a house. From the model, Sungevity calculates the pitch of the roof, the azimuth (for instance, where the house faces in relation to compass points) and the available area.

"You introduce errors when you put a guy on the roof," Kennedy asserted.

Sungevity uses data from Microsoft Virtual Earth rather than Google Earth for its satellite imagery. Google Earth only provides a top-down view of a roof. Virtual Earth gives data from different angles, which lets Sungevity calculate pitch.

The data provides enough information to provide a fairly strong estimate even without customer input, he said. To prove its point, Sungevity is going to mail fliers to all of the homes in Albany, Calif. Each flier will come with a picture of the home that goes with the address on the flier, a picture of the home with simulated solar panels, and the cost savings. (To fine-tune the estimate, customers need to submit their power bills.) The company has largely been operating under the radar since it started in December.

Rather than install custom solar panel systems, Sungevity offers five different systems, ranging in size from 1.4 kilowatts to 5.6 kilowatts. Prices range from $7,500 to $38,500 for everything after rebates are subtracted.

While operating only in California right now, the company will try to expand to other states. It may employ solar installers as subcontractors in other states, or it may sell estimating services for installers in other states.