Citizenre
From Wikipedia, the free encyclopedia
| The Citizenrē Corporation | |
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| Type | Private |
| Founded | 2005 Startup company |
| Headquarters | Wilmington, DE, USA |
| Key people | David C. Gregg, President & CEO |
| Industry | Solar |
| Employees | Approx. 7 plus approx. 1300 independent sales associates |
| Website | www.citizenre.com |
Citizenrē is a renewable energy startup company that plans to rent photovoltaic (PV) solar systems to homeowners in the United States. The name Citizenrē is a combination of the word "citizenry" with the abbreviation "RE" which stands for renewable energy.
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[edit] Business plan
The company's business plan is based on the premise that they can reduce the cost of generating electricity by cheaply manufacturing and installing company owned residential roof top solar electric panels. The electricity produced will be purchased by householders under contract to Citizenrē. Excess power produced during daylight hours will be "banked" with local electric utilities by net metering to be drawn on at night.
The company plans to construct its own PV manufacturing plant, with production beginning early in 2008, and will franchise local installers to customize and install the systems. The sales and marketing is being conducted through independent contractors using a network marketing model.
[edit] System overview
The Citizenrē REnU system (REnU = Renewable Energy Unit) is based on standard multi-crystalline PV technology in order to save costs and ensure longevity. The customer's home will be fitted with a design to best fit the customers needs. This will allow the system to produce excess during daylight hours to offset the nighttime electrical usage. An inverter will convert the DC to AC, and the system will be tied to the grid to provide power as needed.
The customer signs a fixed-length contract to pay a flat rental rate that is fixed for 1, 5 or 25 years. The rate for each homeowner is determined by the average rate of their local electric utility. This could provide significant savings for homeowners living in States where electric rates are expected to rise or have risen in the last year or two. Because the rate is locked in at the previous years average electric rate.
The flat rental rate is determined as a name plate capacitiy for the rental equipment. Through a program of solar assurance you would be creditied at the end of the year for any underproduction due to odd weather and any over production would be at no charge.
[edit] Benefits of the Citizenrē business plan
The Citizenrē system has a number of benefits:
- Broadening the solar PV market. Currently, a PV system can cost an average homeowner more than US$40,000. The market is currently aimed at luxury homes, and remote homes that have no electric grid access. By lowering the entry cost, without incurring consumer debt, the solar PV market will be able to expand to include the huge middle class suburban homeowner.
- Reduction of dependence on dirty power sources. Citizenrē hopes to encourage the U.S. to be able to adopt solar for 25% of electric power needs by the year 2025. [1]
- Encourages distributed power generation. Having power generated where it is consumed reduces the effects of loading in the electric grid. This will be particularly beneficial on hot summer days when the grid load is at peak, and solar generation is also at its peak.
- Provides cost savings to consumers. Because PV systems generate a known amount of power from a device of known upfront cost, and does so without consumables, means that Citizenrē can enter into long-term contracts with customers, essentially preventing a rise in the price of electricity. Even if the rates of the local utilities rise due to resource costs, labor costs, or inflation, the Citizenrē customer's rates remain at the original price for the entire contract period.
- System size matched to usage. The Citizenrē system is continually adjusted as necessary to provide the correct amount of power for each customer. For example, if some members of the household move away, Citizenrē will reduce the number of panels on the home.
[edit] Criticism of Citizenrē
Although the company is still in startup mode, it has drawn criticism from some existing solar industry players. The main areas of criticism are:
- Value of each individual system. The Citizenrē business model requires an install cost of less than half of the current solar installation price per kilowatt. The company counters that this will be solved through their vertical integration and standardized installation techniques.
- Corporate funding. The company says that they will acquire US$650 million in loans to build a manufacturing plant. They have not yet released the source of these funds.
- Sales model. The company has instituted a network marketing strategy, ostensibly to begin sales at a very low cost. Although there are negative associations to network marketing companies, Citizenrē is quick to point out that there is no cost to join their sales network, and no need for the sales people to make any purchases, thus preventing abuse.
- Installation waiting list. Installations cannot begin until the manufacturing plant is built and the installer franchises are in place. It is estimated that this won't occur until sometime in 2008.
- Industry shakeup. Many current solar installers are afraid they will lose customers to Citizenrē's claims of solar with no initial cost. If this occurs rapidly, many installers could go out of business, and then if Citizenrē fails, there will be limited solar installation capacity available in the U.S.. Citizenrē states that these fears are unfounded, since the company's offering appeals to a new market segment.
