Silicon Valley bets on solar startup as US sector shrinks

By Naureen S. Malik, Bloomberg

Venture capitalists are among investors putting $75 million into a US startup’s push to install home solar and batteries for an electricity subscription — just as the residential market shrinks.

Daylight Energy raised the funds in a round that included $15 million in equity led by Framework Ventures with participation from Andreessen Horowitz, Lerer Hippeau, M13, Room40 Ventures and EV3, according to a statement. The $60 million raised for project development, led by Turtle Hill Capital, will be used to install equipment starting with about 1,200 homes in Illinois and Massachusetts.

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Participants will be able to sell excess power to nearby grids and save about 20% on electricity bills, said Chief Executive Officer Jason Badeaux.

With the addition of solar and batteries on homes, hundreds of megawatts can be freed up or fed back into the grid to prevent blackouts during extreme weather while rewarding participating homeowners. Yet, the residential solar industry has struggled over the past few years primarily due to high interest rates and reduced incentives in California, the biggest market.

The upheaval has forced several US residential companies to restructure; others including Sunnova Energy International Inc. went bankrupt. Installations have been falling and are forecast to drop 13% next year as federal tax breaks roll off, according to a September report by the Solar Energy Industries Association and Wood Mackenzie.

–With assistance from Mark Chediak.

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