What Happened to SolarCity Corporation?
SolarCity, co-founded by Elon Musk's cousins in 2006, rose to become the largest residential solar installer in the US before accumulating significant debt. It was acquired by Tesla in 2016 for $2.6 billion, becoming part of Tesla Energy. While its solar panel installations initially declined post-acquisition, Tesla Energy's overall revenue, driven largely by battery storage, has seen substantial growth, and the company is now making a renewed push into solar manufacturing with new US-made panels and ambitious production targets for 2028.
Quick Answer
SolarCity, once the leading US residential solar installer, was acquired by Tesla in 2016 for $2.6 billion due to its mounting debt. It was subsequently integrated into Tesla Energy, and the SolarCity brand was phased out. While Tesla's solar panel deployments struggled for years, the broader Tesla Energy division, heavily bolstered by Powerwall and Megapack battery storage, has seen significant revenue growth, reaching $12.8 billion in 2025. As of 2026, Tesla is making a renewed push into solar manufacturing with new US-made panels and aims for 100 GW of annual solar capacity by 2028.
📊Key Facts
📅Complete Timeline16 events
SolarCity Founded
SolarCity Corporation is founded by brothers Peter and Lyndon Rive, cousins of Elon Musk, who also served as chairman and provided initial funding.
Initial Public Offering (IPO)
SolarCity goes public, trading on the Nasdaq Global Select Market under the ticker symbol SCTY, with an IPO price of $8 per share.
Becomes Largest US Residential Solar Installer
SolarCity achieves the position of the leading residential solar installer in the United States, largely due to its innovative solar leasing model.
Stock Price Peak
SolarCity's stock reaches its all-time high of $88.35 per share.
Financial Difficulties Emerge
The company begins to experience significant financial problems and a substantial drop in its valuation, partly due to the high costs associated with its rapid growth and leasing model.
Tesla Proposes Acquisition
Tesla formally proposes to acquire SolarCity, initiating the process that would lead to its merger.
Merger Agreement Signed
Tesla and SolarCity sign a merger agreement for an all-stock transaction valued at approximately $2.6 billion.
Acquisition Completed by Tesla
Tesla completes the acquisition of SolarCity, which is subsequently delisted from Nasdaq. Its operations are integrated into Tesla Energy.
SolarCity Co-founders Depart Tesla
Lyndon Rive and Peter Rive, the co-founders of SolarCity, depart Tesla months after the acquisition.
Solar Roof Production Begins
Production of Tesla's Solar Roof tiles begins at Gigafactory 2 in Buffalo, New York.
Musk Wins Shareholder Lawsuit
A Delaware Court of Chancery rules in favor of Elon Musk in a shareholder lawsuit challenging Tesla's acquisition of SolarCity, finding the deal 'entirely fair.'
Tesla Energy Revenue Reaches $12.8 Billion
Tesla Energy's revenue climbs to $12.8 billion, a 27% year-over-year increase, primarily driven by battery storage products like Powerwall and Megapack.
Launch of New US-Made Solar Panel
Tesla launches a new US-made 420-watt solar panel, assembled at its Gigafactory in Buffalo, New York, marking a renewed focus on its solar panel offerings.
500,000 Solar Installations Milestone
Tesla Energy surpasses 500,000 solar panel and Solar Roof installations globally, representing approximately 4 GW of deployed clean energy capacity.
Solar Roof Discontinued
Tesla discontinues its Solar Roof product, ending a nearly decade-long effort to integrate solar generation directly into residential roofing.
Plans for 100 GW US Solar Manufacturing by 2028
Tesla announces ambitious plans for a massive new solar panel manufacturing factory in Texas, aiming to achieve 100 gigawatts of annual solar manufacturing capacity in the US by the end of 2028.
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🔍Deep Dive Analysis
SolarCity Corporation was founded on July 4, 2006, by brothers Peter and Lyndon Rive, with their cousin Elon Musk serving as chairman and an initial backer. The company quickly established itself as a pioneer in the residential solar market, becoming the largest installer in the United States by 2013. Its innovative business model, which offered "no-money-down" solar leases, made solar energy accessible to a broader customer base, but also led to the accumulation of significant debt, reaching over $1.5 billion by 2016.
By 2015, SolarCity began facing substantial financial problems and a sharp decline in its valuation. In June 2016, Tesla, led by CEO Elon Musk, formally proposed to acquire SolarCity. The acquisition, valued at approximately $2.6 billion in an all-stock deal, was completed in November 2016, with SolarCity subsequently delisted from Nasdaq and its operations integrated into Tesla Energy. Musk championed the merger as a crucial step towards creating a "vertically integrated sustainable energy company," combining Tesla's electric vehicles and battery storage solutions (Powerwall) with SolarCity's solar generation capabilities. However, the deal was controversial, with critics alleging it was a bailout of a financially struggling company in which Musk and other Tesla directors held significant personal stakes.
Following the acquisition, Tesla's solar panel installations experienced a notable decline for several years, failing to consistently reach pre-merger levels. Despite these challenges in solar deployment, the broader Tesla Energy division saw substantial growth, largely driven by the success of its battery storage products, Powerwall and Megapack. In a significant legal development, Elon Musk faced a shareholder lawsuit alleging that he orchestrated the SolarCity acquisition to bail out the company. After a trial, a Delaware court ruled in Musk's favor on April 27, 2022, finding the acquisition to be "entirely fair."
As of 2026, SolarCity no longer operates as a distinct entity, its functions fully absorbed into Tesla Energy. Tesla Energy has emerged as a rapidly growing segment of Tesla, Inc., reporting revenues of $12.8 billion in 2025, with battery energy storage deployments reaching 46.7 gigawatt-hours. In a renewed strategic push for its solar business, Tesla launched a new US-made 420-watt solar panel in January 2026 from its Gigafactory in Buffalo, New York, and discontinued its Solar Roof product in August 2026. The company has announced ambitious plans to significantly expand its US solar cell manufacturing capacity, aiming for an unprecedented 100 gigawatts annually by 2028, signaling a shift towards becoming a major solar technology provider and manufacturer rather than primarily an installer. By March 2026, Tesla Energy had surpassed 500,000 solar installations globally.
What If...?
Explore alternate histories. What if SolarCity Corporation made different choices?