Having installed this scenario, LMFTFY:
Solarcity installs a system (panels, storage, chargers/inverters) on your premises at zero cost to you. They also have options from $0 down to fully paying for the system.
They get the tax subsidy offered for the installation. This is correct except where it's required by law to go to the owner of the home; I live in Oregon which has $1500/year for 4 years that is required to go to the homeowner. SC offsets this credit by charging $75/month extra for 4 years, which means I have a net credit of $600 each year coming my way.
You roof is now occupied by solarcity. Yes, the roof has solar panels on it.
They sell you electricity AND what you don't use, they sell to your local utility. The power back to the grid goes as a credit on your account and is pulled watt-for-watt when you use more than the solar panels can produce (aka at night). The systems are guaranteed for a certain number of watts per year and, if it comes in under that, SC actually writes you a check for the difference.
You have now switched energy providers and are STILL paying power bills. Yes. You pay for the system based on the power it generates. I can't really tell if your comment here is trying to be naive; you expect a $0 down system to not charge you for the power?
I fully recognize they they take on what maintenance there is on this plant... But there isn't much and they are completely unregulated. They charge the home owner whatever they please, just so it's below the regulated utility. Maintenance, hopefully, is minimal. However, they provide full insurance for the roof (where it was installed) as well as theft (apparently it's a problem). They are regulated by the contract that is signed at the beginning. The price is based on the contract; one option is to have a variable rate per year, the other is to pay (in my case $250) up front and have a fixed price for the term of the contract, which is $20 years. My price came in slightly lower than my utility company was charging at the time and is set for $20 years; this with the fact that my power company raises rates every year and is in the process to do a relatively large jump to pay for some new complexes, I think I am in a very good position.
And to touch on some of your reply below this:
Uhhh... it's unfair in that solarcity uses the tax benefit/subsidies due the homeowner AND has the homeowner's roof locked up under a 20 year lease? I've calculated that at retail levels, equipment costs and installation is paid off in 10 years. That's before the tax benefits/subsidies are applied.
Not sure what pricing you're using; I have a 4.9kw system which would be close to a $23,000 system installed. My fixed price for 20 years is 0.0984/kWh and qualifying credits I could get is around $16,000, bringing the total cost to around $7,000 meaning 14 years before my SC would break even on a private system, after credits. And that implies you have $23,000 in cash to pay for the system. How you believe it is unfair to sign a contract, I do not know. Most tax benefits/subsidies are due to the owner of the system, not the homeowner. And the roof is not what is 'locked up', the lease and the system are. You are fully allowed to have the system moved (at cost of labor) to a new home.
Now, let's add a peculiar California spin on this (my state). The utilities have been required by law to add storage capacity to the grid for something known as regulation... Fill in. This means regulating the grid up and down. When they regulate the grid up... They feed energy to the grid. Regulating down means absorbing from the grid. These activities are extraordinarily lucrative and the property owner get's none of that but it uses the "plant" they have effectively paid for.
I'll reiterate that power to and from the grid is exchanged watt-for-watt.
This is also why the utilities are crying foul over the lack of grid maintenance fees by the entities with this type of operation (there are only a few, but they're all big, pretending to be small). They get to act like an energy provider with few, if any of the responsibilities. And home owners shoulder most of the burden. I consider it a scam. The operation is new, mildly more complicated than just plugging in a blender so there is confusion. And "they" are taking advantage of the confusion, back by lawyers.
This I will I say I know little about. I still pay to my power utility, so I still get charged for 'the service'.