Sungevity, which offers homeowners solar leases in lieu of up-front system costs, will soon expand its offerings into the northeastern states. The company recently raised additional financing, allowing it to expand its offerings to additional states.

In a Dec. 15 press release, the company said that it has raised well over $25 million during a round of funding which is not yet closed, meaning the company could attract more investors, but hasn’t made any projections.

At present, California-based Sungevity only offers solar leases in Arizona, California and Colorado.

With the additional financing, company founder and social entrepreneur Danny Kennedy said that the company will be able to expand into new states.

“We’re headed Northeast in the spring, probably on a staggered timeline,” he said. “The likely suspects are Massachusetts, New Jersey and Pennsylvania—for a start.”

Homeowners sign a lease for the system, providing the energy to the homeowner at a fixed price for a set period of time, which should represent a savings over their current electric bill.

“It’s a no-money down, pay-as-you-go service that replaces your conventional [electricity] bill,” he said. And the company leverages financing for the photovoltaic installations from its investors.

Sungevity contracts with local installers and is product-agnostic. It gets the cheapest, highest quality products it can for installations, Kennedy said.

“The customer doesn’t really care who made the panels. If it doesn’t perform as projected, we’re on the hook,” he said.

To help finance a homeowner’s solar system, Kennedy said, the company retains the rebates and incentives.

“Some of those values the solar systems have get turned over to investors,” he said. Sungevity would own any renewable energy credits (REC) related to a system, allowing its investors to sell them to help pay for the system.

“In the Northeast where they’re mainly REC, those values would need to be monetized as well,” he said. However, customers get the benefits of net excess generation produced by their system. “That’s credited to their bill.”

With solar leases and power-purchase agreements expanding the reach of the solar market, the way people purchase solar is changing.

“It’s going away from hardware to the best customer service,” Kennedy said. “It’s kind of exciting. It’s becoming a well-proven model. It’s fast becoming the major part of the market.”

In October, for example, the company sold 170 systems, basically a megawatt of solar power, to new customers. Kennedy contributes the company’s success in this new market partly to Sungevity’s ability to make it a virtual process.

“It’s about ease for the customer,” he said. “As we migrate from selling hardware to electricity, it’ll be about who makes it easiest to get solar.”

Pictured: Sungevity lease program customers Mike and Julie Peterson, courtesy of Sungevity.