History

SolarCity was founded in 2006 by brothers Peter and Lyndon Rive, based on a suggestion for a solar company concept by their cousin, Elon Musk, who was the chairman and helped start the company. By 2009, solar panels it had installed were capable of generating 440 megawatts (MW) of power.

In 2011, the company launched their expansion to the East Coast with the acquisition of the solar division of Clean Currents and groSolar. Following the acquisitions, SolarCity expanded operations on the East Coast and opened in Connecticut, Pennsylvania, South Carolina, Florida, Vermont, and New Hampshire.

In 2013, SolarCity was the leading residential solar installer in the U.S. and Solar Power World magazine listed it as the number two overall solar installation company in the U.S. In 2013, SolarCity purchased Paramount Solar from Paramount Equity for $120 million. By 2015, its installed panels were capable of generating 870 MW of solar power and accounted for approximately 28% of non-utility solar installations in the U.S. that year.

In October 2014, SolarCity announced it would be offering up to $200 million in solar bonds, and would launch a new online website to allow purchasing the bonds; this was the first registered public offering of such bonds in the United States. In March 2016, SpaceX bought $90 million of SolarCity stock.

In late 2015, SolarCity withdrew from solar sales and installation in Nevada, following the decision by the state's Public Utilities Commission (PUC) to raise the monthly service charge for rooftop solar customers and progressively reduce the return on solar energy sold back into the grid under the state's net metering rule. Under the new rules, the monthly service charge imposed on Nevada Power's rooftop solar-generating customers rose from $12.75 to $17.90, and was scheduled to rise to $38.51 by January 1, 2020; simultaneously, the rates given to rooftop solar generating customers for their surplus solar energy were also clawed back and were to continue to decline over the ensuing four years. As a result, SolarCity eliminated more than 550 jobs in Nevada.

2016 workforce reductionedit

During 2015, the number of employees had grown by 69%; at the end of 2015, SolarCity had 15,273 employees. To preserve cash, SolarCity eliminated 20% of its total workforce in 2016, and at the end of 2016, it had 12,243 employees. This was the first time in the company's history that it cut its workforce.

The job cuts affected workers across the entire company: 22% of jobs were cut in operations, installations, and manufacturing and 27% in sales and marketing. In August 2016, the company announced that it planned to take up to $5 million in charges to cover its planned layoffs. The company also cut the salaries of its two co-founders from $275,000 to $1 per year.

Subsidiary of Tesla Inc. (2016–present)edit

On August 1, 2016, Tesla announced (in a joint statement with SolarCity) that it would be acquiring the company in an all-stock $2.6 billion merger. Tesla's mission since its inception has been "to accelerate the world's transition to sustainable energy". As part of Elon Musk's "The Secret Tesla Motors Master Plan", Tesla sought to expedite the world's move from a mine-and-burn hydrocarbon economy towards a solar electric economy. The announcement cited (as benefits of the acquisition) operational and cost synergies, as well as integrated products. The proposal for acquisition was approved by antitrust regulators.

Musk unveiled a new solar roof tile in October 2016 in order to gain investor support for the acquisition. However, the tiles on display were later revealed to be fake. Members of the anti-Tesla group TSLAQ have cited Musk's solar roof tile reveal as a major point of contention and an impetus for organizing. The solar roof was being produced in volume in March 2020.

More than 85% of unaffiliated shareholders from Tesla and SolarCity voted to approve the acquisition on November 17, 2016, allowing the acquisition to close on November 21, 2016. (Affiliated shareholders are those who hold executive positions at either company, such as Elon Musk.)

Some investors criticized the deal, calling it "a misguided effort to rescue two companies that depend on investors and the government for operating cash." There is ongoing litigation against Musk and Tesla's board of directors, alleging "they overpaid for SolarCity, ignored their own conflicts of interest and failed to disclose 'troubling facts' essential to a rational analysis of the proposed deal."

In April 2017, the chief policy officer of SolarCity, John Wellinghoff, left SolarCity. In June 2017, Lyndon Rive left SolarCity, and Peter Rive left shortly thereafter. Gigafactory 2 (Giga New York) opened in Buffalo in late August 2017.

Total solar installations have been declining since the Tesla acquisition. Tesla's energy revenues increased from $1.12 billion in 2017 to $1.55 billion in 2018, but declined slightly in 2019 to $1.53 billion. Analysts believe that SolarCity has been "a big source of the cash-flow deficit" for Tesla in 2019.