California Passes Solar Panel Mandate

California Passes Solar Panel Mandate

Alex BekezaBusiness Member
Lender · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes

California recently signed a mandate requiring most new homes in the state to include solar panels after 2020. California is the first state to do so, but it likely won't be the last, with New Jersey and Minnesota pursuing increased reliance on solar.

Despite criticisms of the mandate, the trend towards increased solar use will continue as economies of scale push prices down, utilities pivot their business models and the economic and health benefits of decreased reliance on the grid and fossil fuels are revealed over time.

The measure, approved by California regulators in a unanimous decision on Wednesday May 9, 2018, will require all new residential buildings, including apartments and condos that are three stories or fewer, to have rooftop solar panels starting in 2020.

The California Energy Commission, the body responsible for approving the decision, estimated the panels will tack on approximately $9,500 in additional construction fees but save homeowners $19,000 in energy bills over the course of 30 years.

Reactions are split on this.  I wanted to see how the Bigger Pockets community would weight in.. Any thoughts???

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Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
8y

@Nathan Gesner I just had to weigh in on your comment and so called "hard truths" which turn out to be entirely false. I've responded to each of your points respectfully because I've had a different experience with solar than what you describe.  

1. The payback period for solar hasn't been 20 years in 20 years. In many areas such as California the current average payback period is 5-8 years on a cash purchase. A 20 year payback period like you describe is not impossible but it would be rare with today's prices. You'd have to drastically overpay or detail your panels with gold trim to have such a long payback period. The panels on my roof were paid off in less than a year. I bought them at wholesale price and installed them myself, so it depends on how good a deal you get, how good your roof orientation and pitch is, how many sunny days you get in your region, how good your local incentives are, how much local competition there is among solar installers, etc.  However calculating payback periods is uncommon these days anyway as the cash purchaser is rare. Just like real estate most people finance their systems, so what matters is cash flow. Typically loan payments are less than a normal utility bill, so people with solar pay less per month for electricity than those without, that's why people do it, because they like saving money. 

2. Solar is indeed "green energy". What you are referring to is called embodied energy or energy return on energy invested (EROI). It is easily calculated including resource extraction, manufacture, shipping, and installation. Solar panels take 1 to 4 years to offset their embodied energy with electricity production, depending on the brand. The standard warranty is 20-25 years, so they pay back the energy it takes to produce themselves several times over during just the warranty period, and average life expectancy is 30-50 years as evidenced by the panels produced in the 70's that are still making electricity today.   

3. Yes there are tax subsidies for solar. Please find me a form of energy that is not subsidized. Nuclear for example is the most subsidized form of energy, it would not exist without government subsidy because nobody would insure a nuclear power plant. Tax dollars insure nuclear plants, clean up disasters and also store the waste indefinitely. 43% of coal is mined on public lands, then it is shipped on railways built with tax dollars and burned in power plants built with tax dollars. Oil would be insanely expensive today if not for the Intangible Drilling Cost tax deduction of 1916, the Oil Depletion Allowance Act of 1926, the Domestic Manufacturing Deduction of 2004, etc. Energy is about the farthest thing from a free market you'll ever find, so why single solar out for getting government support when all forms of energy do? Many conservatives and libertarians actually love solar, it's not just liberals who love saving money! In fact the Solar Investment Tax Credit, the 30% tax credit which is driving the growth of the solar market, is from the Energy Policy Act of 2005, which if you recall was during the presidency of George W. Bush. That tax credit was recently extended by another Republican president. 

4. Batteries are either a luxury add on for those who prefer a battery bank over a generator for backup power, or a necessary component for a backwoods cabin that is off the grid. 99% of modern solar electric systems don't even use batteries. They use what's called net metering which doesn't require batteries. As far as circuits burning out I'm not sure what you're referring to there, that's completely made up.

5. What panels use those hazardous materials? None that I've ever seen. Cadmium was used very briefly and on a small scale years ago but that type of panel is obsolete. Modern solar panels are made from silicon wafers. Silicon is the eight most common element in the universe. It is not hazardous and is easily recycled. 

6. Every solar system I've worked on has produced more energy than forecasted. Somebody may have messed up an energy forecast at some point, but it is not standard industry practice or lawyers would really love solar. As far as birds burning up, that has happened in a few isolated incidents with concentrated solar farms in the Mojave desert, which is a completely different technology than rooftop solar. It's not a factor with the types of panels you find on residential rooftops like California now requires. Also birds get killed by semi-trucks every day but that doesn't mean we're going to halt the trucking industry does it?

There is a lot of bad/outdated information about solar out there, I didn't want it to be propagated here. I'm not sure I agree with California's mandate, and I'm not sure how it will be implemented when many homes aren't suitable for solar, however I hate to see solar categorized as liberal/bad technology when it's actually great technology that benefits everyone regardless of political affiliation. 

See this reply in the discussion

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  • Investor · Valencia, CA · Member since 2017 · 171 posts · 130 votes
    8y

    My $0.02 and I am in the solar industry for full disclosure.

    If there truly was a level playing field, solar and renewables would be winning hands down. Grid parity was reached 5 years ago nationally. Depending on sources of information, fossil fuels and energy derived from them receive at the very low end $1.5 trillion in subsidies annually to a high end of $5 trillion. That doesn't factor in the human cost of death and injury of men and women in uniform protecting fossil fuel supply, or death and injury from localized pollution and environmental damage.

    When you factor those true costs in, solar and renewables win hands down. However, because of the non-level playing field, rebates and subsidies are in place to encourage adoption. One person's subsidy is another person's investment. If NASA had not paid extortionate amounts for the original microchips, we would not be on this forum now.

    California making solar mandatory for new construction is a response to the obvious. We are as a species moving towards renewables. It makes sense for economic, employment, manufacturing cost, environmental and national security reasons. When the World's 5th largest economy does this, other States and countries will follow. It is an inevitable journey to renewables no matter what we think or how much we really "dig" coal.

    So what is the impact? Well it will increase CA's solar adoption at an accelerated pace. Currently at around 7.6% adoption, that will quickly hit 10% which history shows is a number that spurs mass adoption. For the homeowners "forced" to buy solar with a new home, they pay up front to save many fold over the years from reduced or eliminated utility bills. For existing homeowners, they will need to make a decision whether or not to bring their properties in line with new construction to compete on resale price. It is likely that many will, especially as rebates and net metering mean there is no out of pocket to do so (in most cases). Fannie Mae allows a full appraisal value of an owned (but not leased) solar system.

    However! "Mandatory" and "Incentive" do not work together - no one pays us to wear seatbelts. I think this measure - especially as it moves across the US - will lead to an accelerated decrease in the Federal tax credit - currently 30%. Also as benchmarks are reached in terms of adoption, utilities can renegotiate net-metering rates to pay less for the excess produced by a solar system. 

    In short then, the conditions to go solar now are certainly as good as they are ever going to be. It will be "good" in future, but I believe increasingly not as good as now.

    In California and I believe every State, there are laws in place regarding the efficiency of new construction - insulation, double glazed windows etc. They are paid for up front by the homeowner who then benefits from reduced utility bills. This mandate for solar on new construction is no different to that, other than it is a true investment in owning your own power rather than renting it from a "public" utility.

    The main down side of this increase in renewables is the "duck curve". This is the upsurge in power required when solar is not operating after dark. In order to meet that demand the utilities have to keep powerplants running to ramp them up. They cannot just switch them on, so they bear a cost in over-production. The solution to this is in storage. That is the weak link in renewables now. True daily use batteries for economic home use are a year or two away from mainstream. For utility scale, even further. Investment (subsidy) would accelerate this technology and manufacturing to make storage economical. It's happening in the private sector, but a NASA type investment as happened in computing would be awesome.

    As far as "Govt telling us what to do", well I've been in LA for 25 years. Anyone that has been here for any length of time will tell you about the massive positive impact of clean air legislation. Sometimes Govt involvement makes sense and I think we'll look back on the CA solar mandate as one of those times. The fact that major manufacturers like Volvo are eliminating fossil fuel powered vehicles is a great indication also of where CA and the rest of the World is heading in that regard. 

  • Flipper/Rehabber · Minneapolis, MN · Member since 2016 · 1k+ posts · 1k+ votes
    8y
    Originally posted by @Andrew Smith:

    Fannie Mae allows a full appraisal value of an owned (but not leased) solar system.

    Does Fannie Mae allow for any value related to a leased system?

  • Investor · Valencia, CA · Member since 2017 · 171 posts · 130 votes
    8y
    Originally posted by @John Woodrich:
    Originally posted by @Andrew Smith:

    Fannie Mae allows a full appraisal value of an owned (but not leased) solar system.

    Does Fannie Mae allow for any value related to a leased system?

     Not currently.

  • Real Estate Investor · Audubon, PA · Member since 2009 · 13k+ posts · 8k+ votes
    8y
    Originally posted by @John Woodrich:

    Another thing to factor in when adding solar to a house is that you may have to make the decision whether you want to replace your roof at the same time...  Or factor in the added cost to remove everything during a re-roof in the future.

    Maybe. I know of two properties in the Philadelphia suburbs where the solar panels are not on the roof but on the ground. Of course to do that, there must be some ground on the parcel that is suitable, and that the owner is willing to have used for this purpose rather than other uses (garden, play area, parking, pool, etc.).

  • Rental Property Investor · Phoenix, AZ · Member since 2016 · 553 posts · 314 votes
    8y
    This is greenwashing (or dare I invent the term greenstanding) because solar costs half as much in large installations as it does on your roof. In other words, this is just another costly regulation. Also, Los Angeles has some of the oldest housing stock in the country. Rebuilding it with any code would save energy. But saving energy isn't the goal here. If California wants to save the world they need to start with transportation eventful consumption.
  • Rental Property Investor · Maryville, TN · Member since 2009 · 529 posts · 414 votes
    8y

    Will homeowners insurance go up to cover a solar system?

  • Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    8y

    @Autumn Gernhardt Solar panel prices have come down significantly over the past several years due to China mass producing panels to meet demand. If you looked into it in 2014 you can expect current pricing to be significantly lower now than you were quoted then. Residential solar pricing dropped from about $4/watt average installed price in 2014 to around $3/watt today, so about a 25% drop. The $20k system quoted to you in 2014 is likely to cost around $15k now. The $9,500 estimate is an average on new construction installs, every system is slightly different. As you know from getting a quote each system is sized to match the roof space and usage history of the specific home. You should get an updated quote (get several, I recommend getting quotes from at least 3 installers), see for yourself if it makes sense for you with todays pricing. Financing the system with a $0 down low interest loan will likely save you money immediately because your loan payments are likely to be less than you're currently paying for electricity, plus adding solar will increase the resale value of your home. 

    @BJ Dante

  • Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    8y

    @Will G. not in my experience

  • Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    8y

    Here is some more info on the mandate: 

    Takes effect in 2020.

    Applies to new homes and MF buildings of 3 stories and fewer.

    Also applies to major remodels.

    Approved by CA Energy Commission 5 votes for, 0 against.

    Includes new insulation, lighting and air filter requirements.

    Includes design flexibility for buildings unsuitable for solar.

    Solar panels do not have to be on the roof, builders can build a central community solar array nearby to offset newly constructed buildings unsuitable for solar or share of remote community solar arrays can be purchased to virtually offset consumption.

    New home building industry associations support the bill. They are putting solar on majority of new homes anyway.

    Arguments for:

    Reduction in green house gasses

    Improves home owner’s cash flow position by lowering energy bills n average of ~$80/month

    Arguments against:

    Raises housing prices by average of $9500 in already expensive place to live (expected to raise mortgage payments by ~$40/month on average)

    Raises barrier to entry for home ownership, harming low income families

    Info from the California Energy Commission Website:

    http://www.energy.ca.gov/releases/2018_releases/20...

    FAQ’s:

    http://www.energy.ca.gov/title24/2019standards/doc...

    Infographic:

    http://www.energy.ca.gov/title24/2019standards/doc...

  • Rental Property Investor · Maryville, TN · Member since 2009 · 529 posts · 414 votes
    8y

    I would like to know how the $9500 was arrived at?

    I priced an install in florida, 2012 and it was $28k with the local power company subsidy

  • Accountant · Philadelphia, PA · Member since 2013 · 303 posts · 210 votes
    8y
    Originally posted by @Steve K.:

    @Autumn Gernhardt Solar panel prices have come down significantly over the past several years due to China mass producing panels to meet demand. If you looked into it in 2014 you can expect current pricing to be significantly lower now than you were quoted then. Residential solar pricing dropped from about $4/watt average installed price in 2014 to around $3/watt today, so about a 25% drop. The $20k system quoted to you in 2014 is likely to cost around $15k now. The $9,500 estimate is an average on new construction installs, every system is slightly different. As you know from getting a quote each system is sized to match the roof space and usage history of the specific home. You should get an updated quote (get several, I recommend getting quotes from at least 3 installers), see for yourself if it makes sense for you with todays pricing. Financing the system with a $0 down low interest loan will likely save you money immediately because your loan payments are likely to be less than you're currently paying for electricity, plus adding solar will increase the resale value of your home. 

    @BJ Dante

     I've always wondered how this math actually works. Say in 2014 you purchased a 20k system that is now worth 13k. How much is the lease value when you go to sell the house today? Wouldn't that be a deterrent to a buyer? For people who are hard to qualify, does the solar financing company have to sign off on the lease transfer?

  • Brookfield, WI · Member since 2016 · 191 posts · 108 votes
    8y

    Sigh, I really dislike when government mandates the use of a very specific type of technology, rather than an requirement on the outcome.  So, rather than solar panels, a efficiency requirement, or a requirement on the amount of grid electricity per sq. foot.  What if you we happen to come up with a combination of other technologies and techniques that eliminate the same amount of electrical usage as the panels proved?  Oh well, law says you have to have them.  Guess instead of spray foam, a whole house fan, and automated windows, and all led fixtures,  I get solar panels and just add central air .... Then again, you get the government you deserve in this country.

  • Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    8y

    @John Woodrich

    Originally posted by @John Woodrich:

    Another thing to factor in when adding solar to a house is that you may have to make the decision whether you want to replace your roof at the same time... Or factor in the added cost to remove everything during a re-roof in the future.

    @John Woodrich correct, it's recommended to replace your roof before adding solar if the roof is expected to be in need of replacement in the next few years. One thing about this you may find interesting and/or be able to provide clarification on is whether or not the 30% tax credit may also apply to the cost or a portion of the cost of a new roof. Disclaimer: I'm a solar professional not a tax professional, I can not give tax advice and any info you read here is simply info on how someone might act. Anyone reading this should do their own research or speak to a tax professional before making a decision on how to file their own taxes. Here is an excerpt from the instructions for Form 5695 (the form you would need to fill out to claim the tax credit) which pertains to included costs:

    What it looks like that sentence is saying to me is: a roof that is built to be able to hold a solar array counts as a structural component, and therefore counts as a cost of the project. For ground mounted systems any racking, concrete footers, earthwork and trenching etc. is included so a new roof may fall into that same category of associated expense. I have had tax professionals tell me they believe the roof or at least the portion of the roof with the solar on it can be claimed. Once again anyone reading this should talk to a tax professional about this before making any personal decisions on how to file their taxes.  

    Here's a link to form 5695:

    https://www.irs.gov/pub/irs-pdf/f5695.pdf

    https://www.irs.gov/forms-pubs/about-form-5695-res...

  • Flipper/Rehabber · Minneapolis, MN · Member since 2016 · 1k+ posts · 1k+ votes
    8y

    @Steve K. I don't have the energy for additional research but in general I recall the cost of the roof would not count but it has been a couple of years since I last claimed a solar deduction.  Believe the client was in Maryland.

    If the roofing is a part of the system it would likely qualify but replacing a normal roof, which has nothing to do with the solar system, would not.  

    One example of this would probably be Tesla's solar tiles.  Not sure if that ever launched but I believe their concept was to replace your roof with tiles that are part of the system.  In that case the panels are the roofing material so they would qualify.

    *disclaimer - been a while since I have researched it.

  • Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    8y

    @Account Closed That would depend on the specific lease contract. I don't sell leased systems but the contracts I have seen specify what the buyout price will be at various times throughout the contract term. There are various leasing products including prepaid leases. Yes it could be a deterrent to a buyer, I know a few realtors who have had deals fall through due to buyers not wanting to assume the lease, although I think that's rare. Yes I believe the buyer has to qualify with the leasing company to assume the lease however the credit spectrum is pretty big considering the buyer would have an electricity bill anyway, it's not adding a new bill it's replacing one bill with another lower one. Personally I wouldn't want to assume a lease, I would prefer to own the system. Leases were more common a few years ago before other financing options were available but now that low interest financing is available loans have become much more common. Loans are paid off during a sale of the home, they don't transfer to the buyer. 

  • Jennifer T.Pro Member
    Investor · New Orleans, LA · Member since 2014 · 1k+ posts · 944 votes
    8y

    As someone who has solar panels, I'm going to address a few of the things I've read.  I have had solar panels on my own house for about 5 years.  They are in full sun, nothing shades them.  Net metering, so no battery.  Overall, I produce about 50% of the electricity I use with them.  Which I'm actually disappointed with but, oh well.  They were still a good choice for my home.  On a typical day, I'm giving back to the electric company during daylight hours.

    With that said, I only got them because it was a lease program.  Nothing down.  $35/month.  In exchange, I signed over the tax benefits to the company.  The panels become mine after 20 years.  Which I realize is about their life span.  I don't think a monthly rate that low is offered in my area anymore.  I'm only obligated to pay the monthly fee for 6 years.  If /when I sell the house, the new owners can take over the agreement.  Or I can call the company to take them back.  Easy peasy.

    Included in my contract, they address if I ever need to replace/repair my roof.  I don't remember the exact amount, but it is something fairly nominal to have them come out, take the panels off, have the roof work done, and then come back to put the panels back on.  Definitely less than $500.  Of course, different companies will be different.

    I am a fan of solar panels, but also think they should be an individual or builder's choice.  I threw a side-eye to CA when I saw they had passed this legislation.  Like others have mentioned, it is especially awful for houses where the roof doesn't get much sun anyway and panels are an almost useless and unnecessary cost.

    When I got the panels for my house, before they were installed, the company had to first come out and measure how much sun my roof got.  Because they couldn't claim the tax benefits unless there was some minimum level ;).

  • Anthony GaydenPro Member
    Rental Property Investor · Omaha, NE · Member since 2014 · 2k+ posts · 3k+ votes
    8y

    Yes, you may save money over the long run through energy costs, but that means absolutely nothing to a person trying to qualify for a loan to buy the house initially if there is an additional $15,000+ tacked onto the purchase price.

    Housing is extremely expensive in California, to the point where in many parts of the state it is totally unaffordable for people at the median income levels. California has a multitude of regulations that have literally driven the price of housing to astronomical levels and made it nearly impossible to build housing. This will only exacerbate the problem, making housing even more expensive and adding another rule that developers must follow.

    The result will be an even tighter and more expensive housing market with even less housing.

  • Investor · Ridgecrest, CA · Member since 2017 · 247 posts · 120 votes
    8y

    Good

  • Ned J.Pro Member
    Investor · Manteca, CA · Member since 2017 · 1k+ posts · 2k+ votes
    8y

    Had 3 solar companies come out and do analysis and quotes for me and none of them made any economic sense for my home. The numbers just didn't work and the break even point for cash purchase was pretty far out. The biggest section of my roof would be shaded 30% of the best time of day and my current electricity bill tops out at $250-300 a month MAX and that's maybe 1-2 months a year, I don't crank the AC and don't have a pool or a water well etc. The numbers just didn't work for me....but I see a ton of solar in my neighborhood and community.

    I don't see this as any worse that any other energy regulation...vehicle pollution, fuel mileage, insulation, water consumption. It may not be perfect and the "early days" will be full of "issues" but in the long run we HAVE to go renewable in this country...... our fossil fuels are a limited source and whether you believe in climate change or not, the health of our planet needs to be a top priority...there is no "do over"

    My only concern is how many of those homes will truly be efficient using solar..... size and design of roof...sun exposure etc, But I'm sure those will factor into the home design from the start.

    I see this as a good thing for the overall health of our planet.. as much as we would all love for "consumer demand and the free market" to dictate new technology, sometimes you have to force things to go in the right direction before that demand materilaizes

  • Karen MargraveBusiness Member
    Moderator
    Realtor, General Contractor, and Developer · Redding, CA · Member since 2009 · 7k+ posts · 4k+ votes
    8y

    I think it costs 20-30000 for the panels and over 30 years a savings of 16,000. Not a great deal. I moved out of CA, and let's just say, 95% of the people I've met in the construction industry, property management, title companies, etc. are former CA residents. 

  • Investor · Princeton, TX · Member since 2014 · 1k+ posts · 1k+ votes
    8y

    I think this is a really article on the topic... 

    https://www.vox.com/energy-and-environment/2018/5/...

    I do not think people have focused enough on the storage parts of the regulations that were adopted.  Storage makes all the difference in the economics of this, because of the amount of solar power California already has.

    I think most of the systems will not only have solar they will be having solar plus storage (batteries).

    Tesla will be the big winner.

  • Real Estate Investor · Des Moines, IA · Member since 2016 · 922 posts · 533 votes
    8y

    @Alex Bekeza

    @Russell Brazil

    I've only read the first two posts here.

    Russell I typically find your posts to be very thoughtful and informed by lots of experience.  I would want to know what informs your opinion that this should be a choice.  Should all energy efficiency measures be a choice?  At what point does simple common sense energy efficiency measures cross over into where it just.. Makes sense.

    What is your opinion on insulation, for instance?  Shouldn't we as consumers be assured through regulation and building codes, etc - that builders will build houses with insulation in them nowadays?  My opinion is that at some point (cost, payback, reliability, etc) - we have to honestly look at this stuff being mandated....

  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    8y
    Originally posted by @Jim Goebel:

    @Alex Bekeza

    @Russell Brazil

    I've only read the first two posts here.

    Russell I typically find your posts to be very thoughtful and informed by lots of experience.  I would want to know what informs your opinion that this should be a choice.  Should all energy efficiency measures be a choice?  At what point does simple common sense energy efficiency measures cross over into where it just.. Makes sense.

    What is your opinion on insulation, for instance?  Shouldn't we as consumers be assured through regulation and building codes, etc - that builders will build houses with insulation in them nowadays?  My opinion is that at some point (cost, payback, reliability, etc) - we have to honestly look at this stuff being mandated....

     Many people with solar panels in my market pay higher electric bills than those without. Not all markets, depending on weather and the varied cost of electricity are good candidates for solar panels. Further not every house is a good candidate for solar based on its positioning. Not all architectural styles fit solar, for instance roofs with lots of dormers.  Should we eliminate building cape cods and only allow colonials in order to accommodate the solar lobby?  

    Particularly in our current housing shortage, with builders not building low end homes...we should not be forcing the price points of houses up to force on the consumer something that should be a choice.  

    Consumers are free to get solar if they want, but they should not be forced to relinquish their rights to enjoy their property in the manner they like to satisfy the solar lobby. 

    Id venture to say that 30-50% of homes in my market with solar, have the panels removed as part of the sales process. Energy costs in the midatlantic are simply very low, and our incomes very high so the cost of electricity is quite negligible. 

  • Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    8y
    Originally posted by @Russell Brazil:
    Originally posted by @Jim Goebel:

    @Alex Bekeza

    @Russell Brazil

    I've only read the first two posts here.

    Russell I typically find your posts to be very thoughtful and informed by lots of experience.  I would want to know what informs your opinion that this should be a choice.  Should all energy efficiency measures be a choice?  At what point does simple common sense energy efficiency measures cross over into where it just.. Makes sense.

    What is your opinion on insulation, for instance?  Shouldn't we as consumers be assured through regulation and building codes, etc - that builders will build houses with insulation in them nowadays?  My opinion is that at some point (cost, payback, reliability, etc) - we have to honestly look at this stuff being mandated....

     Many people with solar panels in my market pay higher electric bills than those without. Not all markets, depending on weather and the varied cost of electricity are good candidates for solar panels. Further not every house is a good candidate for solar based on its positioning. Not all architectural styles fit solar, for instance roofs with lots of dormers.  Should we eliminate building cape cods and only allow colonials in order to accommodate the solar lobby?  

    Particularly in our current housing shortage, with builders not building low end homes...we should not be forcing the price points of houses up to force on the consumer something that should be a choice.  

    Consumers are free to get solar if they want, but they should not be forced to relinquish their rights to enjoy their property in the manner they like to satisfy the solar lobby. 

    Id venture to say that 30-50% of homes in my market with solar, have the panels removed as part of the sales process. Energy costs in the midatlantic are simply very low, and our incomes very high so the cost of electricity is quite negligible. 

    Russell, There are certainly a few outliers but in general solar does make economic sense in Maryland. This may not have been the case the last time you looked into it but it has been the case increasingly over the last several years as Maryland has passed tons of legislation favoring solar. A recent bill was passed that makes it even better. Maryland just committed to 50% renewables by 2030 and 14.5% of that is expected to come from solar, which is already causing an uptick in solar installs. https://pv-magazine-usa.com/2018/02/14/maryland-bi...

    Maryland homeowners who financed or leased solar systems saved an average of $131/yr. in 2017 compared to those without solar and solar owners offset an average of $1,722 worth of electricity.  Average payback period for a purchased system in 2017 was 8 years (https://www.energysage.com/solar-panels/solar-pane...). 

    Maryland has a $1,000 grant, an SREC program where solar customers receive about $140/year for their renewable energy credits, a favorable net metering program, plus state and federal tax credits. https://www.energysage.com/solar-panels/solar-reba...

    Regarding your guess that 30-50% of homes with solar have the panels removed during a sale: If you have seen or heard of solar panels being removed it is likely they are old 4'x10' tilted up solar thermal panels, rare relics which heat hot water or glycol. Those have almost all been removed and the few remaining will be removed, however when people refer to solar panels in 2018 they are almost always referring to solar electric panels/ photovoltaics/ PV. PV panels can not be removed during the sale of a home without violating the 20 year net metering agreement with the utility so the number of modern solar panels being removed during a sale is 0. Why would someone remove them even if they could? Who doesn't like reduced operating costs? Solar is a selling point. The national appraisal institute has proven this fact based on sales data (This study by the appraisal institute shows that homes with solar sell at a premium and in a reduced time period compared to homes without, and it actually includes Maryland data) https://www.appraisalinstitute.org/solar-energy-sy...

    As a realtor you should like solar, if the house is worth more and sells faster, your job is easier and commission higher. Just beware of leased systems as the transfer of the lease agreement can add an additional step in the sales process due to the buyer needing to assume the lease or the seller needing to buy out the lease. Many realtors have learned how to get in front of the situation and help manage that process to make it easier for both parties in order to streamline the sale. 

    You are correct that not every home is suitable for solar. Good solar design requires large south, east or west roof surfaces where a nice clean array can be laid out. Dormers, shade, vent pipes, etc. create obstacles. I would not recommend onsite solar if the array(s) detract from the aesthetics of the home. I like clean rectangles. I believe the resale value is more likely to be effected positively if the array looks good, but ultimately it's up to the homeowner/buyer if they think it looks good or if they care about that or not. 

    However you don't even need a roof to go solar in 2018. Many states such as Maryland and California have community solar arrays where you can purchase solar panels that are miles away from the home but still power that home using remote metering. The California mandate makes design allowances for roofs that prohibit onsite solar, and offsite solar can be tapped using remote net metering in cases when the roof orientation is not suitable or the homeowner prefers not to have rooftop solar, so the CA mandate doesn't actually force anyone to install solar on their roof.

    I agree with you and others here that solar should be a choice, as a solar advocate I worry that ramming it down people's throats or at the very least having the optics of doing that could cause a negative backlash. The California mandate will boost the solar industry but there's a risk that other energy commissions across the country could react by punishing solar in those markets. Time will tell, but in general the solar industry is booming worldwide and all indications point towards continued rapid growth, with a few inevitable hiccups along the way.

    Here's a link to some general info on solar in Maryland: https://solarpowerrocks.com/maryland/

  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    8y

    "Maryland homeowners who financed or leased solar systems saved an average of $131/yr."

    $131 per year, or $10.91 per month is not moving the needle in one of the, if not the richest part of the country. (10 of the 20 richest counties in America are in my market).

    I do not like, nor dislike solar.  The Realtor lobby, of which I am a part of lobbies for the rights of homeowners.  We like personal property rights.  In my market, solar reduces the value of the property.  That will likely not always be the case, but it is the case today.  Consumers do not want it and certainly do not want it forced on them.  For purely anecdotal evidence to show the demand, one need only look at my neighborhood. Roughly 1,000 housing units, and a median price point of $1 million...so people who can easily afford them without issue....and not a single panel exists in my neighborhood.  

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