Sungevity, a closely held Oakland-based developer of rooftop solar systems, may consider an initial public offering after competitor SolarCity sold shares that rose more than four-fold in the first year of trading.
"We are maintaining our options open right now," Andrew Birch, Sungevity's chief executive officer, said in an interview in London. "We don't rule it out. It's the right thing for a company that's been as successful as we have, doubling every year. The public market reception for the first of the big successful solar companies is a great signal."
Both companies lease rooftop solar installations to homeowners at little or no upfront cost, a model that's driving a surge in projects across the U.S. SolarCity, the largest U.S. installer, sold shares at $8 apiece to raise $92 million in December 2012. The shares closed at $54.36 Wednesday.
U.S. homeowners installed 792 megawatts in solar capacity last year, up 60 percent from 2012, according to data compiled by the Solar Energy Industries Association.
Sungevity offers photovoltaic systems in nine U.S. states, Australia and the Netherlands. It has raised more than $200 million to date from investors including General Electric and German utility EON SE to drive expansion into new markets.
Birch said the company doesn't need fresh capital following its latest $70 million fundraising, which was completed on April 4. It sees interest from investors in a market that's set to accelerate.
"It's an exciting space," the CEO said. "Investors want multiple opportunities to play the theme, so it's going to be an interesting time for investors and companies."
Sungevity, which sells systems online or by phone, generates about two thirds of its revenue in the U.S., where sales doubled last year. It has about 10,000 customers, which lease systems with an average size of about 5 kilowatts.
The market penetration of solar energy will rise quickly as system prices drop 20 percent to 25 percent every year, according to Birch. Solar only generates 0.5 percent of U.S. power demand, a share that could rise to as much as 40 percent, he said.
The levelized cost of electricity from residential installations should reach $0.10 a kilowatt hour within 3 to 5 years from an average $0.15 now, according to the CEO.