solar panel

solar panel

FORTUNE — If investors merely went by labels in making buy-sell decisions, SolarCity would have been doomed by its name. Companies involved in solar energy have been toxic on Wall Street of late. The culprit has been cheap solar panels from China that have whacked established manufacturers, like First Solar, and rendered stillborn well funded startups, including Solyndra (now bankrupt) and Miasole (recently sold on the cheap). SolarCity has thrived because it buys solar panels and then installs them for its mostly residential customer base in 14 states. SolarCity markets to consumers from Home Depot stores and recently signed a deal to offer financing for installations to Honda’s U.S. customers.

Lyndon Rive: It has nothing to do with [that]. They do have an electric vehicle, so there is some synergy there directly. Because if you change your mobility to all electric, you’re still polluting.

Lyndon Rive: Federal tax credit. And then it goes down to 10%, which is the same tax credit that fossil fuel gets. And so then it falls into that category. It’s insane that it has the same tax credit as a polluting fuel source. Beside the point, we have a clear cost reduction map to make sure that by 2017 we can continue to offer cheaper clean electricity without the 30% tax incentive.

Lyndon Rive: Yeah. Actually about half our customers look at doing a full energy evaluation of their home. They pay $300 for that, so they really are interested to see how their home is consuming energy. We don’t view it necessarily as upselling. We view it as what would you want your perfect energy company to do for you. You’d want them to sell you cheap electricity. You want the electricity to be clean. And then you’d want them to look at your house and say where can you consume [less] electricity. That’s the perfect energy company. So that’s why we do energy efficiency. Not only are we going to sell you cheaper electricity, but we’re going to go into your house and help you use less electricity.

Lyndon Rive: You know, we actually wrestled with that before we went public. We said, “Should we change the name? Because solar’s just the product today. If there was another magic product that we could just put in somebody’s house and it created clean energy, we’d absolutely deploy it.” So we wrestled [with] that. And energy efficiency is a big part of the business. We do batteries. We also do electric vehicle charging systems. So we really wrestled with the name. And then we actually had a strong conversation with Salesforce.com. They actually wrestled with the name many times. Eventually they just said, “Look, Salesforce.com is the brand, and we’ll add all the other services around it. People will get to know the other services.” So we settled on SolarCity, and we’ll add the other services. People will get to learn that SolarCity is an energy company that has a lot more than just solar to offer.

Lyndon Rive: So the tariffs have already affected the panel pricing from Chinese panels into the U.S. So that’s already built into the cost. The cost reduction was a larger number than the tariff itself. So if there wasn’t a tariff, the price would be even lower, but with the tariff it’s a little higher but still lower than it was before. So it’s built into the numbers and it has close to zero effect.

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