Tech CU Expands Solar Financing Arrangement Into the Billions

Technology Credit Union of San Jose, Calif., has extended a financing agreement with Sunlight Financial to generate residential solar loans through contractors.

Tech Credit Union ($3.7 billion in assets, 139,186 members) has committed to fund another nearly $2.5 billion in residential solar and storage systems sold and installed by Sunlight partner contractors over the next three years — enough to fund 75,000 solar systems.

The agreement expands a long-term partnership between Sunlight Financial and Tech CU that began in 2015.

Sunlight Financial, which has offices in New York and Charlotte, N.C., is a business-to-business-to-consumer (B2B2C) fintech organization with an online platform called “Orange,” which the company said is designed to provide residential solar contractors with seamless point-of-sale (POS) financing capabilities.

“Over the years, we have built a strong partnership with Sunlight Financial predicated on accelerating America’s transition to renewable energy,” Tech CU President/CEO Todd Harris said. “Sunlight Financial’s high-quality installer partners and underwriting processes are appreciated by Tech CU, and we look forward to extending our partnership.”

Sunlight Financial offers five- to 25-year residential solar loans. Its news release last week said it is able to deliver both instant credit prequalifications and approvals for solar loans that typically result in lower monthly loan-plus-utility payments than homeowners’ pre-solar utility bills.

Five credit unions, one bank and a few private investors have funded $3.5 billion in loans through Sunlight Financial from 2016 through 2020, including nearly $1.5 billion in loans last year and $1 billion in 2019. This year it said it expects its partners to originate another $2.7 billion, according to a January investor presentation.

A chart in the presentation showed only one credit union, identified as “Credit Union #1,” as having loans through Sunlight Financial starting in 2016. That credit union had funded about half the total volume over the past two years.

According to a report earlier last week from the Solar Energy Industries Association, the United States had 2.8 million solar electric installations in December 2020 capable of generating 97.7 gigawatts, or 3% of U.S. electrical demand.

Solar capacity includes 19.2 gigawatts installed last year. The SEIA said it expects the U.S. solar industry will install more than 324 GW of capacity over the next 10 years, quadrupling the current amount of solar capacity installed.

SEIA President/CEO Abigail Ross Hopper said the trends show that by 2030 the equivalent of one in eight American homes will have solar.

“After a slowdown in Q2 due to the pandemic, the solar industry innovated and came roaring back to continue our trajectory as America’s leading source of new energy,” Hopper said.