[Published Jan. 29, 2015, in the Jeffco editions of the Denver Post's YourHub section]
Community Solar Gardens provide an excellent avenue for renters and those with shaded rooftops, but the financial proposition is very poor for a homeowner with a shade-free rooftop, in comparison with owning a solar system. When advocating for solar gardens, it is important to disclose that the value of a kilowatt-hour generated by a solar garden is about half the value of a net-metered kilowatt-hour generated by an on-site installation.
We want to be sure that you have accurate information because there have been some shifts in the market that aren't reflected in your column. Here is some information to keep you up to date:
- Solar leasing is quickly fading in our market, as the financial attractiveness of this approach has dropped sharply. The financial proposition for a lease is not viable for many projects in our area at this time. Companies that are traditionally focused on leases are increasingly transitioning to solar loan or cash purchase options. This is due to the reduction in overall price of PV to about $3 per installed watt, as well as dropping incentives in the Solar*Rewards program for third-party leases.The reduction in cost for PV also has affected the financial proposition for tracking. At this time, it is less expensive to own a fixed array with a few extra solar panels than it is to install and maintain trackers with a slightly smaller solar installation.[End of portion published in YourHub]
- At this time, the only utilities in the state enforcing a 10 kW limit for residential installations are Intermountain Rural Electric Association (IREA) and San Luis Valley Rural Electric Cooperative (SLVREC). There is no such limit with Xcel Energy, United Power or any of the other utilities serving our area.
- Xcel Energy's Solar Rewards program is set up for Small systems up to 25 kW, and Medium systems greater than 25 kW. Residential installations are welcome in both categories, and homeowners are able to continue adding solar up to 120% of demand over the past 12 months at the time of application.
- As a broker, you are in a valuable position of influence with appraisers and mortgage lenders. Please take a look at the following research, which has important findings. The study entitled The Value of Photovoltaic Systems on Market Value and Marketability is based on transactions on the Front Range, and it finds that an existing solar installation improves home value and purchase price--especially in cases involving a knowledgeable real estate agent. This study was funded by the Colorado Energy Office and it is designed to educate appraisers, so that extra value for a solar system can be added to an appraisal and therefore a mortgage. Spreading the word about this study with appraisers and lenders is an important action that will promote solar implementation. The study also finds that home value increase is greater for owned systems over leased systems.
- The other study is detailed in an article entitled Largest Ever Study Quantifies the Value of Rooftop Photovoltaics, and it details research by Lawrence Berkeley Laboratory. Here's a useful quote from the article: "As PV systems become more and more common on U.S. homes, it will be increasingly important to value them accurately, using a variety of methods," says co-author Sandra Adomatis, an appraiser who helped develop the Appraisal Institute's Green Addendum and who has written and spoken extensively on valuing green features. She noted, "Our findings should provide greater confidence that PV adds a quantifiable premium to a wide variety of homes in California and beyond."