Protection 1, a closely held security company backed by private equity firm GTCR LLC, will start selling solar panels to customers as demand for rooftop systems surges in the U.S.
The home and commercial security and automation company, with almost 2 million customers in the U.S., plans to begin selling the systems next month, Chief Executive Officer Timothy Whall said in an interview today. Profits from the fast-growing solar market could “easily equal” those from its security business, he said.
“We certainly like the financial model and it’s a nice extension from our home automation” business, Whall said. “The timing is good for the solar business.”
Protection 1 will offer systems for as little as no money upfront to lease customers in a bid to tap increasing demand from households seeking to cut power bills. Brite Energy, as its solar unit will be called, joins existing providers like SolarCity Inc., the largest home solar company, and home security and automation company Vivint Inc., whose Vivint Solar unit is the second-largest home solar installer.
Even with the sector’s rapid growth, few homes in the U.S. have solar power systems.
“We love the fact that there is very little penetration,” Whall said.
A third-party financing model that funds about two-thirds of U.S. residential systems helped the U.S. solar industry grow 60 percent last year. The company will also sell systems to commercial customers.
Protection 1, based in Romeoville, Illinois, is counting on its 26-year history and existing relationships to help it gain traction in the solar market. Its main competitors in the security industry include ADT Corp., Tyco International Ltd. and Stanley Security Solutions SA.
Whall expects the company to install at a rate of about 5 megawatts or 1,000 systems a month in the first quarter.
Protection 1 declined to comment on an Aug. 4 Reuters report that GTCR had chosen Morgan Stanley to help sell the company for more than $1.5 billion in an e-mailed response to questions.