Appraisers Don't Give Value to Solar Installations -- Here's Why

I spoke today with Beth Hanlon, an appraiser active in Jeffco and the Foothills, and she said that she cannot assign more than token value (under $5,000) to a photovoltaic installation on a home, because the underwriters would disallow it.  This, she said, would apply regardless of how recent and how productive the PV (or solar thermal) array is.  For instance, I installed a $60,000 PV and $10,000 solar thermal system on my own house a couple years ago, and these two systems save me hundreds of dollars on my electric and gas bills every month. (My energy bill for this 3,600-sq.ft. ranch is about $50 per month.)  No matter, she said.  She couldn't get even a reasonable percentage of that investment approved by any underwriter.  Moreover, if the installation detracts from the curb appeal of the house, Beth will actually deduct for it.  (Since my house faces north, you can't see either of my solar installations from the front.)

If the Obama administration wants to promote clean energy such as PV and solar thermal (not to mention geothermal, which is never visible from the street and an even greater investment), it should consider regulating the valuation of these systems by underwriters.  For example, assign a reasonable life (15 years at least) to these systems, and require a minimum valuation based on its bona fide installation cost, depreciated over that lifetime. 

A homeowner who installs an energy-saving, greenhouse gas-reducing system should be able to recoup at least as much on that investment, percentage wise, as they do by updating a kitchen or bathroom!  The kind of regulation I'm proposing has the additional advantage of not costing any federal tax dollars. 

Moreover, why spend tax dollars incentivizing people to install such systems when the return on investment only applies if you keep the house forever and not if you sell it!  Under the current situation outlined by my appraiser friend, I would NOT advise anyone who isn't going to live in their house for at least 10 years to invest in a PV or solar-thermal or geo-thermal system other than just to feel good about doing so.