Solar in Rentals?
Most Popular Reply
Rental Property Investor · Portland, OR · Member since 2015 · 338 posts · 332 votes
10y@Will F. and others:
This is a topic I've thoroughly analyzed and researched over the past year. I'm a landlord and have worked in the solar energy industry on and off since 2010 in Oregon. I recently had two solar PV systems installed on the roof of one of my duplexes. I would not have done this had the numbers not worked out in my favor.
Disclosure: I DON'T work in the solar industry right now. And I only read the first page of this thread before getting frustrated at so many ill-informed answers that I decided to chime in.
To everyone who says that solar is a bad investment for rental properties--it's not that "you're wrong," but rather, "it depends."
The fact is, every building is different. You can't generalize about whether solar (PV or thermal) would "pay off" for rental properties or even owner-occupied properties. Each state and each utility district has its own incentives and rebates, and even then, all other things being equal, properties in one zip code may qualify for certain programs that others don't.
1. Do the research and find out whether solar may provide a ROI for you (http://www.dsireusa.org/ is one place to start, then visit your state's website for state tax credits, then your local utility company's website for other incentives. This is on top of a 30% federal tax credit off the net price after state credits). The incentives and tax credits also vary if the property/electric meter is considered residential or commercial.
2. Contact at least 3 solar installers for bids. Ask them about all the available financing options and plans. Some companies, like SolarCity, have lease or power purchase options, which may prove to be more cost-effective than purchasing a system, depending on where you live and how big your system is. You may find, however, that purchasing a system from one company doesn't make financial sense, but another company might provide you a much lower bid. When purchasing a system, size matters, as there's sometimes a sweet spot where you maximize the available incentives but don't offset your energy consumption 100% (e.g. in Oregon, the state tax credit maxes out at $6,000, so systems larger than 3.5kW can cost more per watt, if you're buying the system yourself).
It depends on which state you're in, the direction your roof faces, the pitch of your roof, the age of your roof, shading, the average amount of annual sunlight in your area, your electricity company's available incentives, your electricity rate, your electricity rate plan, how long you plan to own the property, how much electricity you currently pay for (if any), how new/energy-efficient the building already is, and available financing options.
3. While the price of panels may fall, so will the available tax credits and incentives. As one person pointed out, most of the cost is in labor, so if you're going to go solar, you will reap the most benefit from your decision if you act sooner rather than later. To those who say, "just install it yourself," no. You can't get many of the incentives if you're not licensed or otherwise professionally affiliated with the state and/or utility district and/or don't tie your system to the grid.
4. There are multiple ways to pass the cost on to your tenants. If you are leasing a system or have an agreement to purchase the power (PPA), you could simply pass the bill onto your tenants. No matter your financing, you could also include the cost of solar in the rent, and advertise this in your rental listing. Thirdly, you could have a separate "solar electricity fee" each month, so the rent listed on your ad is competitive with neighboring listings. Make it clear that the solar system offsets what they'd pay to the electric company and their overall electricity costs will be lower than other area rentals (and make sure that's so).
5. INCOME AND PROPERTY TAX BENEFITS:
- If you purchase the system, you can depreciate the cost. Talk to your accountant as you may be able to cost segregate and depreciate over fewer than 27.5 years. (There might also be an expedited "green upgrade" depreciation rate for all I know, but idk.).
- Many if not most municipalities have statutes that prevent your property taxes from increasing when you add solar or other green upgrades.
- If you borrow to finance the system for a rental, you can also deduct the interest. And if you have a lease/PPA, you can deduct your entire monthly payment.
- There's another benefit, but I'm putting it in #10 below.
I'm not an accountant so do your own due diligence regarding all the points above.
6. Yes, there's a hip factor that will make your solar-powered property more desirable to certain tenants. If you rent to many younger people, or people who are left of center politically, your vacancy rate will likely decrease as now you have a competitive advantage over non-solar units.
7. When you sell your property, if you purchased your system, solar will increase the value of your investment. If you have a lease/PPA, those can be easily transferred to the next owner. Most leases and PPAs will have some sort of rate lock, so if electricity rates continue to rise as they have, in 2021, the per kW/h rate you locked in in 2016 will look very attractive compared to whatever the utility company is charging at that time. There is no reason you should have to "buy out the system" just because you're selling the property. But in theory, you could buy it out if, for whatever reason, your buyer didn't want solar electricity?
8. Solar doesn't cost me anything. Yes. I installed two solar PV systems on a lease. I maximized the system size so 100% of the annual electricity consumption should be offset by solar. I didn't pay for any materials or labor, and the installer maintains the system and insures my roof beneath the panels.
9. Solar saves me money from Day 1. What I will pay for is the monthly lease at ~$40 per system. The electricity pre-solar bills solar averaged about $60 per unit. Subtract the electric utility's base charge of $10/month and that's a savings of about $10/month per unit = $240 (for two systems) in year 1.
My particular lease has a 1% escalator built into it. Assuming electricity rates will continue to increase at about 4% per year, this is how one of my two solar systems pencils out over 5 years (the lease is longer than 5 years because I intend to hold this property indefinitely):
| . | solar | electric utility |
| # months | 60 | 60 |
| IR | 1.00% | 4.00% |
| payment year 1 | 40 | 60 |
| Payment year 5 | $41.02 | $66.30 |
| with electric utility base charge | $51.02 | $66.30 |
| savings per month in year 5 | $15.27 | 0 |
| savings per year in year 5 | $183.29 | 0 |
| total solar savings years 1-5: | $790.05 | 0 |
| total solar savings years 1-20: | $5,201.76 | 0 |
| total solar savings including RETC | $7,601.76 | 0 |
10. I paid nothing for my two systems, but I get to keep $4800 in Residential Energy Tax Credits from Oregon ($2400 per system). This is a portion of the whole credit ($6000 per system); the installer keeps the rest. But since I didn't buy the system or pay for installation, for me, it's like free money.
Granted, I worked in the solar industry so I know the ins and outs of the incentives, tax credits, and financing options, and I leveraged that knowledge to make solar return on its investment (which was $0) from day 1.
I've put a lot time into researching solar for landlords and have a couple more strategies that I didn't mention here. One of the beautiful things about solar at a rental property is, even if you include the cost of solar in the tenant's rent, they are still incentivized to not waste electricity. That's because if they use more energy than the panels can make, they then still have to buy it from the electric utility. So that's just one tidbit up my sleeve.
If you'd like help deciding whether solar could benefit you as an investor or homeowner, or if you want to know a couple other ways you can make money from solar as a landlord, you're welcome to PM me. I don't work in solar anymore; I'm offering up my experience because I do believe in renewables and know that it can be a good investment for some people.
102 Replies
- Investor · Coplay, PA · Member since 2015 · 404 posts · 315 votes10y
I have not.
How are you going to get a return on your investment?
I am going to start offering solar with my roofing jobs. I will be installing solar on my office shortly.
- 10yAlexander FelicePro MemberGuy with Great Hair · Austin, TX · Member since 2013 · 2k+ posts · 4k+ votes
With solar companies claiming an average 7 year payback period there is no way this is profitable.
You pay 15-20k for panels, it essentially removes your electricity bill, except in a rental you're not paying the utility. So you're paying 15k to subsidize utility bill for someone else. You're also now responsible for any maintenance on this unit.
Additionally, solar is going to get much cheaper over the next decade. You would be spending the money when the market rate for solar is at it's highest. Literally the opposite reason of why real estate leverage works: buy with today's money, but income with tomorrow's higher value money. Instead, you want to buy with today's money, when tomorrow's money will be cheaper!
I'm really excited to get solar on my next primary, but on a rental it's a lousy idea.
- Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes10y
Rental property is a financial investment. Solar power will deplete your return on investment, not add to it.
Tenants are typically responsible for paying utilities. If you provide solar, you are giving taking care of the electric bill. If you bump the rent up to cover it, you are not saving the tenant any money, therefore you have taken away any benefit. Also, you can justify raising the rent to cover the electric but how will you recover the cost of the solar installation?
Solar is not a real money saver. It typically takes 15 - 20 years (I'm being generous) just to break even. The only real reason to use solar is if you want to escape the man or help the environment, but there is plenty of argument against either of those.
Finally, if you decide to go with solar then I would purchase it outright. You save quite a bit up front compared to the financing option. And when it comes time to sell, most buyers do not want to buy your existing contract which means you either pay penalties to close out the contract with the solar company or you have a hard time selling.
I don't see solar as a viable solution for an investor hoping to maximize profit and build wealth.
The DIY Landlord Book4.7247 Reviews - Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes10y
The only viable way to make money off solar is to own the company that manufacturers it. Government money, heavily financed panels, corporate contracts. And if you are the CEO, you can walk away with a ton of money after the company goes bankrupt, despite all the government assistance.
The DIY Landlord Book4.7247 Reviews - Investor · Santa Clarita, CA · Member since 2015 · 17 posts · 15 votes10y
Solar will not be getting much less expensive. I have quotes that are between $4 an $5 a watt. Since the panels and the inverter are only about $1.35 a watt the rest is mounting hardware, wiring, and labor. If the panels were free the cost would only go down 20%.
I agree that solar is not a good idea in a general rental. If it is high end and you could charge more to eco minded tenants, then it might make sense.
- Bangor, ME · Member since 2016 · 1 post · 0 votes10y
Originally posted by @Carl Leonard:
Solar will not be getting much less expensive. I have quotes that are between $4 an $5 a watt. Since the panels and the inverter are only about $1.35 a watt the rest is mounting hardware, wiring, and labor. If the panels were free the cost would only go down 20%.
I agree that solar is not a good idea in a general rental. If it is high end and you could charge more to eco minded tenants, then it might make sense.
If this is true (which I assume it is) I would learn how to install it yourself. That would save you on every cost but the panels themselves. There are plenty of DIY for setup online, so buy 1 panel (I assume that's an option) and figure out wiring and such. Plus knowing how to do it yourself might make you money in the long run
I see this is kind of what I had assumed-- it wouldn't make sense for a rental. I thought perhaps with rebates or government incentives it could make financial sense but based on the responses I probably shouldn't invest time/money into it. thanks
- 10yAlexander FelicePro MemberGuy with Great Hair · Austin, TX · Member since 2013 · 2k+ posts · 4k+ votes
Originally posted by @Carl Leonard:
Solar will not be getting much less expensive. I have quotes that are between $4 an $5 a watt. Since the panels and the inverter are only about $1.35 a watt the rest is mounting hardware, wiring, and labor. If the panels were free the cost would only go down 20%.
I agree that solar is not a good idea in a general rental. If it is high end and you could charge more to eco minded tenants, then it might make sense.
I'm saving this comment to go along with other famous quotes such as "the internet is just a fad no one will ever do real business on it" and "TV technology has reached it's peak"
- Investor · Plano, TX · Member since 2014 · 188 posts · 149 votes10y
@Will F., As explained by @Nathan Gesner, since tenants are responsible for utilities, solars on rentals don't make economic sense for a traditional rental approach. However, in certain niche rental models; student housing, short-term corporate rentals or senior living where the landlord takes on the burden of utilities management (for a higher than normal rental rate), then solar could make sense. You also need to keep the house around for longer than 12+ years (or whatever the solar payoff period maybe is).
I do think there are lot of innovations that are coming here, especially with the panel technology, battery storage, power delivery etc, where you could find ingenious ways to save costs and pass some of those cost savings to the tenant. And of course, if economics is not the only play, there's the environmental factor that is good for our own conscience and could be marketed to a tenant who cares about this stuff.
One good thing that solar does is, whether you decide to go solar or not, is that you will be on a path to make the houses more energy efficient; better weatherization, stop leaks, better insulation. All in all, its goodness!
Chiming in with my 2 cents, I am in agreement with the general sentiment that solar power does not currently make sense on a small rental unit. However, in a high-end market like Seattle, conspicuous use of solar panels can add perceived "green" value and appeal to a luxury apartment complex. With rents on a 2-bd unit already soaring past $2,000/month in the urban core and hot neighborhoods, investments such as a solar array to appeal to young, wealthy professionals can pay strong dividends for relatively little.
For example, if you owned a 50 unit tower with all 1-bd.s in the Ballard neighborhood last year, average vacancy rates stood in the 10% range. Given average rents of $1,500/month, it would be worth it to spend $20,000 to install a solar array if it can help you reduce vacancy rates by even a single percentage point. Obviously this is an over simplified example and many factors would go into reducing vacancy rates, but the core reasoning is that if your market is young professionals, that demographic places a higher value on certain features.
Personally, I am in agreement with @Alexander Felice (great name by the way, people named Alex are usually pretty awesome). The technology is still growing and maturing and is not yet ready for roll-out in typical rental units. Give it 5-10 years though, and we could be pleasantly surprised at the potential of the investment. Certainly it'd be nice to reduce utility expenses on larger complexes.
- Architect · Papillion, NE · Member since 2015 · 1k+ posts · 840 votes10y
I agree with the others on this topic. I only see clients putting in PV panels for electricity on projects because they want to send a message they are part of the "green sustainable" movement and have the money to spend. The payback is way to long. In a rental market this only makes (little) sense if the landlord is paying the utilities. The benefits are very locational based as well like the sunbelt states. Its a cool idea but not yet completely feasible for this market. Wind power is a better option to generate electricity. They have solar panels for heating water to lessen the utility load on the typical water heater. Now, this has better payback at the 3 to 4 year range I believe. I have seen this on several projects. But again if you are not paying the utilities then its a lost cause just to have come cool toys for this market. I am all for sustainability when it makes sense and is feasible.
- Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes10y
I think some of you are looking at this from the wrong point of view. First, the payback is going to be a long time no matter what, so it's probably not a great investment.
With that said, just because your building has solar panels, does not mean you need to provide your tenant with free solar electricity. You can bill them for it. Or you can sell it back to the power company. Laws on this vary greatly from state to state. This is what the solar panel companies do when they lease solar panels to somebody. They install panels on a house and then charge the home owner for the electricity generated. Also, if there are any common areas or outdoor areas that use electricity, the solar could be put solely towards that to save the owner money.
How long it would take to generate money would be hugely different from state to state. To make any real money you'd need to do it on a very large scale with a very large investment. I think a better investment would be solar heating, but that would be hard to monetize in a single family property.
- Cambridge, MA · Member since 2016 · 2 posts · 2 votes10y
Hello,
Solar is a great investment for rental owners in some of the states. Massachusetts is a good example - payback period is less than 4 years (IRR-20%). This is achieved through high electricity prices, Federal Tax credit and state incentives. As @Ryan Roberts said you can and should bill tenants for the electricity.
California is very solar friendly ( it is the long time leader by the number of solar installations). So I would expect a payback to be around 4-5 years. This give you about 20% rate of return which is probably not that easy to get from rental properties in California. The cash outlay (if you are paying a system, which I think is the way to go) is about $20K for a typical 2-3BR house/unit.
Hope it helps
- Investor · Century, FL · Member since 2015 · 950 posts · 603 votes10y
I don't understand why this is such a difficult question.
(For the most part) : Solar panels are not an improvement to the unit that will increase rent.
Therefore, solar panels on a rental make very little sense.
- Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes10y
Originally posted by @James DeRoest:
I don't understand why this is such a difficult question.
(For the most part) : Solar panels are not an improvement to the unit that will increase rent.
Therefore, solar panels on a rental make very little sense.
Maybe you didn't read the last two posts? Or any of the other useful posts here?
1. Solar panels increase rent because tree huggers like to brag their house has solar panels. Especially in high end trendy areas.
2. You can sell solar electricity. You can sell it for even more than regular electricity that comes out of the wall, because it's "green". Lots of investment companies own solar farms because they are highly profitable.
3. You can use any solar electricity or heat to offset shared costs. Lots of places, especially multifamily units, have electricity the landlord pays for - outdoor lights, hallway lights, swimming pools, laundry, hot water, etc. Say you have coin operated washer/dryers in your building. You could power them with solar power and keep even more of the coins inserted.
4. Depending on state and federal incentives, you may be able to get 50-90% of the system paid for by the state and feds.
As an industrial landlord, I make quite a bit of profit reselling utilities to my tenants. More than some entire units rent for. It's perfectly legal also.
- Portland, OR · Member since 2016 · 29 posts · 10 votes10y
If I can chime in, SoCal is a great place for solar energy, but as people above pointed out their are challenges if it is for a rental property. They make sense if you can figure out a way to get paid for the energy, since it is a rental, there are three ways to do this.
1. Include electricity in the rent, then you're saving money from the solar power. Might not be the best option because it can make the rent look higher, and tenants overusing electricity could wipe out any returns you get.
2. You could set up a separate lease agreement for the solar system with the tenants of the building, that will last the length of the lease agreement, and will be extended with it, then just transfer it on to the next tenant. This is in most cases the best option, you can also decide if you want to pass on substantial energy savings to tenants, (you could pass on 20% electricity savings, good way to decrease vacancy rates/times).
3. Similar to 2, but instead of a lease you can do a Power Purchase Agreement. Both of these agreements can take some work to set up, but would probably be worth it. In a power purchase agreement you set a rate at which the electricity is sold at, and the tenants just pay for what they use. In this case, you have to have a wireless way to monitor the systems output. Again, you can pass along some savings to the tenant if you want.
Keep in mind that the payback time has decreased substantially just in the last year, and while panels will likely get cheaper, you aren't buying at the most expensive, that would be when they cost about $76 a watt. In SoCal the panels will also probably increase the value of the apartment by at least what you paid for them, and maybe more. You might not be able to get the federal tax break, depending on how you pay for them, and what type of building it is. If you want to get solar and set up a lease or PPA with your tenants, I'm part of a startup working on making a reusable template for the docs, as well as other services to help landlords get solar in a financially viable way.
The only way solar would make any scenes on a rental would be if you could rent the roof space to a solar company. If they pay all costs for units and instillation then paid you a monthly income from the power generated back into the grid. By itself it will not increase what a tenant will pay not even tree huggers.
- 10yRoy N.Pro MemberRental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
By reading this thread, the assumption appears to be Solar is only photovoltaic. With that interpretation, I agree with @Greg S. and many (most?) of the other respondents that photovoltaic panels on your rental will not increase the rents you command, nor will it have a cost-effective payback (a least not anywhere where we've looked at it). Now, if you have a very large multi-unit complex (100s of units) with the right orientation and a large expanse of suitable flat roof you might be able to lease the rooftop to a solar energy company and make a suitable level of return.
There is another form of solar energy, not mentioned here and that is solar thermal. Solar thermal is far cheaper to install and maintain. In situations where the landlord carries heat (central hydronic) or domestic hot water, it can have a payback of less than five years. Even in our northerly (read long, cold winters) climate, a modest (8-10K installed) solar thermal system met 60% of the DHW needs of a 6-unit building and meant the boiler did not need to fire at all during the summer to heat hot water.
Such a system can also be used to pre-heat the return lines of a hydronic baseboard/radiator heating system lessing the load on the boiler. If you have hydronic radiant heat (in-floor/wall/or ceiling), solar thermal is capable of heating the water sufficiently on its own (meaning you can have a smaller in-line boiler or hot water heater as an ancillary heat source for a string of overcast winter days when the array may not be able to sustain the temperature of the storage tank.
- Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes10y
Originally posted by @Thomas S.:, b
The only way solar would make any scenes on a rental would be if you could rent the roof space to a solar company. If they pay all costs for units and instillation then paid you a monthly income from the power generated back into the grid. By itself it will not increase what a tenant will pay not even tree huggers.
Very ignorant and uninformed post.
First lets be clear, solar is an investment that will pay back on EVERY HOUSE in EVERY CITY in the United States. If you buy solar panels they will pay for themselves at least twice during their lifetime, this is a fact. Sometimes, this could take 25 years or more, and not be a lot of money, but it is a paying investment none the less. It depends on how you paid for the panels, there are many, many different ways to go about it. Most often you do not have to pay 100% of the cost.
If you let a solar company do everything for you, you are not leasing space to them, they are leasing panels to you. Big difference. They keep the majority of any profit, that is why they are in business. You do not "rent roof space".
You ABSOLUTELY DO NOT need a 100+ unit MF to profit from or invest in solar. You could do it with just one single family home. As an example, my property in Oregon generates 31.6 cents per kilowatt for solar energy sold back to the power company. At the same time you can buy power for only about 11 cents. Solar energy is worth almost THREE TIMES what normal power cost. That money goes in my pocket, not the tenant.
And yes, I already mentioned solar heating many posts ago. This is likely to have a faster pay back than solar power, but only if you are somehow providing heat to your tenants already. You can't sell heat to the power company, but they will buy all the solar power you can generate.
Also, you can definitely increase rent rates with solar panels on the right property. Can you do this with section 8 tenants in downtown Detroit? No. Can you up charge tenants in a fancy loft in Seattle for having solar panels? Absolutely!
- 10yRoy N.Pro MemberRental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
@Account Closed:
The rudeness is really unnecessary and borderlines on trolling.That aside, the poster you elected to quote and insult is from Ontario, Canada and, unless things have changed significantly in his province since I last looked into the benefits of photovoltaic panels there, his statements are correct for his jurisdiction.
Since you appear to be certain that installation of photovoltaic panels are cost effective everywhere, even at small scale, and that their installation will lead to the ability to collect higher rents, please provide us with details of how this is accomplished.
BTW: From a business perspective a payback of 25-years would not be considered the best use of capital.
- I feel like there's a lot of assumptions and outdated statements being made on these replies... With that said, here's my 2 cents... SOLAR POWER IS IN STYLE! It might not guarantee you can raise your rent, but I can almost guarantee it won't lower it. A younger demographic would be attracted to housing with solar. Like many others have posted, you can already see this in Seattle. There is no reason for a young, green minded professional to avoid solar; it's got a great reputation so far. The only cons of solar we hear are from the people paying the cost for the panels. Tenants will never have to do that. 25 minutes north of Seattle is my home base, Everett. The majority of people here are Boeing, Navy, or hospital people; not very tech. East of Broadway in North Everett is what many investors and residents consider "the rough part of town." Yet, I drive by a 4plex everyday that has solar panels installed. I noticed them being installed about two years ago. Whether it is a good investment, I have no idea. The fact is there are people doing it in a part of my neighborhood where people (landlords specifically) are not known to splurge on amenities. Most homes in this neighborhood are 100+ years old. The majority of subsidized housing is in this neighborhood also. PUD has been actively marketing their solar panel incentives in this area the last 6-9 months. It has been on my to do list to find out exactly what I would qualify for. However, like most other landlords here, I do not put it very high on my list of priorities and I've never made the call. This post has me thinking though. As soon as the PUD office opens I am going to give them a call and report back with all the info they give me. I should have info on local rebates, federal tax credits, and net metering. I'm also sending out an open invitation to anyone on BP to find out what incentives your local power companies and to calculate an actual ROI (if any) for installing solar. Just please stop repeating yesterday's news on tomorrow's technology, the world is moving faster than ever and those who can't keep up will simply be left behind!
- Investor · St. Thomas, Ontario · Member since 2015 · 692 posts · 312 votes10y
Unrelated to real estate I recently crunched numbers on Solar. I'm a Computer Engineer and a handyman, so component purchase and install is different for me than Joe Investor. My bottom line on paper was 10% ROI, which is a "not bad" investment.
There are two competing factors to consider here:
1. Ontario hydro prices are rising quickly and only a moron would think that they won't continue to do so. Having your own source of electrons is just good planning. "When" I have my dream home built, it will be fully off-grid.
2. The price of panels is and will continue to fall. As more staunch opposition to technology opens their eyes, the volume of production will rise and prices will fall. This means that when you are selling a house with 20k in panels with a 10-year life left in them 15 years from now, you cannot expect to have 10/25th of their original value in "capital" as a benefit to the sale of the house. Those panels will be half the price 15 years from now.
As for their value to a renter... Where I am the population of hipsters has not risen to the point where they are a market force, so I have no input. Some people might like bamboo floors, hemp drapes and solar panels, but they don't mean squat in my market.
- Specialist · Toronto, Ontario · Member since 2016 · 564 posts · 425 votes10y
Government incentives can make solar worthwhile. It is more difficult to make money when you are just providing solar into the rental, and the tenant therefore has subsidized utilities.
Here in Ontario, the provincial government implemented Feed in Tariff (FIT) and MicroFit sytems. This is where you produce solar power on your roof, and sell it into the grid. The hydro company pays you. You then buy whatever you need from the grid.
The advantage is that they want to go green, so they are paying more for the power than you are buying it back from the grid.
My family has a solar system on an industrial property. 500 kw of panels, 250 kw inverter, and we are getting $0.72 per kwh on a 20 year contract. It will pay for the cost of the solar system in less than 5 years, for sure.
They also have this program for houses, called Microfit. However, all of the rates have dropped substantially since the program was implemented. The system we have would get paid $0.275/kwh, and a small MicroFit system would get up to $0.38/kwh. I'm not sure that it makes as much sense now, but it did at one point in Ontario.
- Investor · St. Thomas, Ontario · Member since 2015 · 692 posts · 312 votes10y
Woah... my calculations of 10% ROI (with my own knowledge and work to install) was with 12c/kwh.
Maybe I need to be considering a large south-facing roof on my next rental!
- Investor · Henderson, NC · Member since 2016 · 484 posts · 208 votes10y
Originally posted by @Roy N.:
@Account Closed:
The rudeness is really unnecessary and borderlines on trolling.That aside, the poster you elected to quote and insult is from Ontario, Canada and, unless things have changed significantly in his province since I last looked into the benefits of photovoltaic panels there, his statements are correct for his jurisdiction.
Since you appear to be certain that installation of photovoltaic panels are cost effective everywhere, even at small scale, and that their installation will lead to the ability to collect higher rents, please provide us with details of how this is accomplished.
BTW: From a business per perspective a payback of 25-years would not be considered the best use of capital.
LOL. I'm not here to make friends with people who make ignorant posts with bad information. Yes, what I said applies in Ontario as well. I don't know or care what the solar incentives are there, as I have said they vary greatly, but I do know two things for sure: Ontario has some solar incentives, and, the sun shines in Ontario. Solar panels will generate income.
The details of how to accomplish this investment are already written in this thread. I'm not going to do your homework for you. It is blatantly obvious there are a lot of people responding here who probably don't even know what a kilowatt is. I don't like it when people post bad information as if they are facts.
Join the conversationCreate a free account to reply, vote on answers and follow this thread.