Tesla Motors

Elon Musk is the founder of Tesla Motors and SpaceX, and supported the creation of SolarCity.

Elon Musk is well-known in Silicon Valley as the founder of the luxury electric vehicle company Tesla Motors, and of SpaceX, the private space transport company.

What’s less well-known is Musk’s contribution to SolarCity, the solar installer and energy efficiency auditor. Musk inspired–and helped fund–the creation of the San Mateo-based solar company. And Tesla is working closely with SolarCity on a clean energy storage solution that would combine Tesla’s lithium-ion batteries with SolarCity’s rooftop solar arrays. The collaboration makes sense: not only is Musk the chairman of SolarCity, but the founders of the company, brothers Lyndon and Peter Rive, are his first cousins.

The Tesla-SolarCity clean energy storage program would couple batteries with solar arrays, providing a way to store solar energy for, say, a cloudy day. Stage one of the project began in 2010, with $1.8 million in funding from the California Public Utilities Commission (CPUC) to launch a research program. Now, stage two seeks to commercialize the program on a modest scale, with over 70 applications pending under the CPUC’s  Self-Generation Incentive Program (SGIP), which provides rebates to customers using self-generated energy systems.

Although the subsidies have yet to be approved, CPUC information officer Andrew Kotch told GigaOm last week, “this emerging technology has a great amount of potential to contribute towards California’s climate and energy goals.” At present, the projects have a “conditional reservation,” and the CPUC will make a decision in the next 18 months.

As chairman of SolarCity, Elon Musk is not involved in such details or the day-to-day operations of the solar company, and CEO Lyndon Rive admits that his cousin’s time is very limited. He only contributes “maybe two hours a month” to the company — by phone — and three hours every quarter for board meetings. For your average chairman, that’s not much time to have a significant impact on a company. But Musk appears to have a rare gift for out the box thinking and strategizing.

“Elon is a phenomenal genius, so when he gives you the time and you lay out the plan, he can quickly identify the hole in the plan,” Rive told me. “This is the true definition of quality versus quantity. You can fix whatever potential pothole you might run into, just in a ten minute discussion with Elon.”

Musk manages to juggle all these projects — plus go to Burning Man — as Lyndon Rive explained in a recent Fresh Dialogues interview. In 2004, on a road trip to Burning Man, Peter Rive told Musk he wanted to do something that had a larger environmental impact, and Musk came up with the initial idea for SolarCity.

Was it was the profusion of attendees using free-standing solar panels to power their RVs? The atmosphere of radical creativity? Or was it just witnessing all that carbon going up into the desert air? Whatever fueled the conversation, it has had a profound impact on the US solar installation market. Last year, SolarCity had the largest share of residential solar installations in the US, and thanks to investments from Google and others, it’s growing rapidly, currently hiring four new employees a day. Like his cousin, Lyndon Rive has stratospheric dreams. Rive told me his ambitious goal is world domination in the energy market, no less. An IPO is anticipated later this year.

(Photo: Craig Miller)

Google is giving a boost to the solar industry today – but not to those large solar farms in the California desert. Nope, the company’s largest clean energy investment to date is going to home solar.

Five years ago, SolarCity was a small, Bay Area start-up. Today, it’s getting a $280 million-dollar investment from one of the most influential players in the game.

“We are very excited,” says Lyndon Rive,  CEO of SolarCity. “It’s a big vote of confidence in SolarCity as well as hopefully a big vote of confidence to the entire market.”

SolarCity’s business is built around installing and financing solar panels for its customers, sparing homeowners the steep up-front costs. That’s been helped recently by falling prices on solar panels.

Rive says the financing has largely been provided by banks thus far. But he’s hopeful Google’s move will bring more corporations into the mix. “If we want to see solar power truly get large-scale and get adoption across almost every home and every business, we need to see the corporations start investing into solar power,” he said.

Residential solar is a new focus for Google. In the past, the company has invested in large-scale wind and solar farms.

“We use energy to power our services and we want that energy to be as clean as possible,” says Parag Chokshi, a spokesperson for Google. He says the company sees small-scale solar as important part of the energy mix — and a good investment.

“We think that supporting the development of this sector will help all of these different technologies get down that cost curve to become cheaper and cheaper over time,”said Chokshi.

The investment will fund between 7,000 and 10,000 new solar installations across the country.