Invariably, when you see a solar array on a home, that house is owner occupied. Typically, when someone rents a home or an apartment, they pay for the electricity bill. That removes any incentive for the landlord to install solar.
If we want to open up a huge slice of pie for solar energy, this needs to change. For instance, about 40% of U.S. households rent their homes. There are about 130,000,000 households. So, we’re looking at an untapped market of roughly 52,000,000 homes! While this logistically isn’t easy, here are some of the big ways it could be possible:
1. Create a tenant/landlord relationship for solar so it becomes financially beneficial for both parties. We’re trying to pave the way for solar energy for renters here in San Francisco.
2. Put solar on a great big unshaded roof to power some of the neighbors with worse exposure.
3. Create incentives for people to install solar arrays larger than their power bill requires. This will require both a feed-in tariff (or some similar incentive) and upgrades to the grid infrastructure (if you have all the houses on the block generating more than they use, you’re gonna blow some transformers. We didn’t really build this grid thing to go both ways).
Anyway, I digress. Back to renters and landlords:
Solar energy, ironically, is way more lucrative for landlords than homeowners (at least until the end of the year). Why? The Federal Tax Credit for Solar Energy is capped for personal residences at $2000, but is uncapped if the property is an “investment” property. In addition, landlords can depreciate the value of the solar array over a shortened period of 5 years. Finally, landlords can take a 50% bonus depreciation for items purchased and placed in service during 08′ (the economic stimulus package). When you see this all on paper, it’s pretty mind blowing.
However, unless they’re into green charity, landlords are not going to put solar on their “business” unless they are saving money on energy somehow too. So, you need to be able to work that energy savings into the lease of the tenant, so that the tenant receives comparable or even cheaper energy costs with clean renewable energy instead of 100% grid power.
This requires a few ground breaking moves on the tenant law side. The tax law is pretty well covered, and we’ve gotten a recent opinion from a professional on this. In addition, I’ve sold a few systems to landowners with tenants recently, and some of them have some intelligent CPAs who have backed this up.
Surprisingly, with respect to the tenant/landlord lease arrangement side of things, we’re getting help from our utility, PG&E. They have offered some legal resources to help figure this out. They routinely surprise me with their facilitation of the solar industry. They understand that the future is distributed power generation. They’re not fighting it, they’re working with it. They are a unique utility.
So the bottom line is, if you rent and you want solar, talk to your landlord and have them contact a solar systems integrator. They may not have all the answers on this, but at least they can size a system correctly and you can present them with the documents in this post as well.
Also, of course, if you live in San Francisco and you rent or own investment property, I’ll be happy to answer your questions about solar and whether it works in your situation.
If you are a landlord or a renter and have basic questions, I’ll try to answer them in this post, ask here:
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“i have a 15 unit building in new york..can i use solar power to heat my building. my heats prices are putting me in the red”
Not really, but you can use solar-thermal to heat your hot water, and it is extremely cost effective, the payback on solar thermal is very quick and it’s not terribly expensive.
“I own four unit building in Florida. Do you have any solar power recommendations for small buildings like this? How can I make this a win-win for me and my tenants?”
The best way we can see to do it is to pinpoint how much money the system produces in electricity, and add that as a monthly fee to the lease. The tenant gets clean energy for a more stable costs without paying any more, and you get the giant tax benefits and get to recoup your investment. It’s win-win. You have to check with the PUC in your state to see if there are issues with “selling” power like this to tenants. Even the PUC here in San Francisco doesn’t have the answers to a lot of questions, and it’s ground zero here for solar innovation in the US… so, this is untreaded territory, but the financial benefits are pretty overwhelming while the 30% tax credits are still in place.
I was confused as to why this picture evoked a visceral response of fear, and then I guess it’s because it looks like a spider, and I’m afraid of spiders.
I have now been up on over 100 rooftops in San Francisco. I have officially laid eyes on ZERO wind installations from any of those roofs. I spoke with the head of the building department in San Francisco today and he said that while the planning department requirements for wind are a burden to comply with, it is still possible, and that they have 4-5 installations in SF so far.
So where the hell is all the wind power? The head of the building department said he had no idea why even that tiny group of people would do it, because there is no way wind can ever be cost effective, but then he said, “who knows, I haven’t checked the financials on that in 5 or so years.”
So…. The last 4 customers I have visited have said that they are exploring wind as an option. I believe there was huge recent coverage of wind, almost assuredly because of the T. Boone Pickens wind project, that has sparked this interest. I need to figure out if wind is viable in order to help these people. If it’s not, they need to know so they can move forward and start helping the environment. If it is, then well, I guess we need to start selling it or pointing them in the direction of someone who can.
OK OK. So here is one wind installation in San Francisco that i have never seen. My guess is it is not to code, or maybe it is. I want to see more of these. If you are the first to give me the address of this installation so I can go check it out, bang, free shirt. But there are more ways to win shirts in this article if you can stomach more poor grammar. Read on.
(P.S. If you are considering wind power in San Francisco, sign up with your interest, as we will be offering it soon. I’m on it. I’ll also try to sell you solar energy immediately.)
If you can provide me with an installer or a quote or something from someone or some company that will currently, today, now, June of 08, install wind power that is more cost effective than PV (for me to determine, but don’t worry, it will be fair and correct and we’re real generous with the shirts anyway) then you win a shirt. If your info or lead is the first of it’s type and is in any way helpful to me to get more wind power in San Francisco, you get shirtage.
Ready? GO!
Let’s get some damned wind power up if it makes sense.
One Block of the Grid is a competition in San Francisco to see which district can get the most San Franciscans to commit to getting solar energy on their homes, and they officially launch today, on the heels of the San Francisco Solar Incentive Program’s passage yesterday.
The winning team will get heavily subsidized (possibly free) solar energy systems by a corporate sponsor, and the other teams still win because by going solar in the same area at the same time, the installer saves money and passes those savings onto the consumer.
It’s a great way to blast through the early adoption phase for solar energy here in San Francisco, which lags behinds it’s neighbors in solar installs, mostly because of its heavy density of renters (Although Tom Price and I are going to change that)
I hope to be performing some of 1BOG’s installations; and I’m excited that knowing from my personal experience, the visibility of interest (below) this provides is going to help these guys overcome the main hurdle to early adoption: skepticism.
