Following a one-year pilot program, Comcast and Sunrun have inked a formal agreement under which Comcast will market Sunrun’s rooftop solar services to customers in selected states earlier this year.
Depending on how the partnership performs, Comcast also stands to acquire a sizable stake in Sunrun, which opened a corporate office in Denver in 2015.
Under the new 40-month program, which aims to accelerate the adoption of solar energy and to reduce the electric bills of Comcast customers, Sunrun will serve as the exclusive residential solar energy provider for Comcast. In turn, Comcast Cable will be a strategic partner of Sunrun via marketing campaigns to be run in those selected markets.
On the financial end, Comcast will receive fees for new customers they bring to Sunrun, and Comcast also stands to earn a warrant of up to up to 9.99% of Sunrun’s outstanding common shares. They said the warrant is earned pro rata after 30,000 customers under the agreement are installed by Sunrun. The warrant is fully earned if Sunrun installs 60,000 customers under the agreement, they said.
UPDATE: Per an SEC filing that sheds more light on the agreement, the warrant enables Comcast to purchase up to 11,793,355 shares of Sunrun’s common stock at an exercise price of $0.01 per Warrant Share
Sunrun, headquartered in San Francisco, said it had deployed 76 megawatts by the end of Q2 2017, a 16% year-on-year increase, and a net present value of $74 million, up 56%. For full year 2017, Sunrun expected to deploy 325 MWs, a 15% year-on-year increase.
Shares in Sunrun were up 31 cents (4.52%) to $7.25 each in morning trading Thursday.
Comcast confirmed the original pilot with Sunrun last fall, noting that it began in Comcast’s Northeastern Division (New Jersey, New Hampshire, Massachusetts, Maryland, Connecticut and New York). In addition to energy savings, Comcast also offered qualified customers a $600 discount payable via a reloadable Visa prepaid card in four quarterly installments of $150.
Regarding other synergies with Sunrun, Comcast noted that it lets customers manage, control and operate key smart home functions, including energy consumption management, with its Xfinity Home service.
Among other energy-facing efforts, Comcast last year relaunched Comcast Energy Rewards, a program offered in select areas, including Pennsylvania and Illinois, that ties energy savings to perks from Comcast that include prepaid Visa cards, three free months of HBO, Showtime or Cinemax and free tickets from Comcast corporate cousin Fandango.
“We believe the residential solar industry will continue to expand over the next decade as consumers look for more cost-efficient, independent and cleaner alternatives for their energy,” Jon Kaplowitz, managing director and GM of new businesses at Comcast Cable, said in a statement. “By working with Sunrun, Comcast can help customers take more control of the price they pay for energy, save them money and help contribute to cleaner communities.”
“At Sunrun, we know homeowners love the savings, backup power and control they get with our solar energy and storage plans,” added Lynn Jurich, Sunrun’s CEO. “Our challenge is making homeowners aware that they can save money with solar today. We are excited to work with Comcast to help their customers go solar and save on their electric bills while reducing their dependence on fossil fuels.”