Multi-family Consultant Services Solution
Your condo property may have multiple owners, or if you’re a multifamily property owner, you may have multiple units. These situations can add complexity in getting a solar project completed. Go Solar West Hollywood is now offering a free service to assist you in moving your project forward so that you are solar ready! Simply register on EnergySage and a Solar Advisor will reach out to help you access this service. Russian translation services are also available.
How Multi-family Property Owners Can Enjoy the Benefits of Solar
Solar can be a great way to attract tenants who care about the environmental or clean air benefits of solar power, and this “feature” of the unit can add to the financial benefits for both the owner and tenant. Whether you are living in your property while renting additional units to tenants or renting out all of your building’s units to tenants, there’s a solar option for you.
As a multifamily rental property owner, the first decision to make is whether you want your solar PV system to provide electricity exclusively to your unit, to one (or more) of your rental units, or to the entire building.
If you decide to install a solar energy system exclusively for your unit or the building’s common areas, you simply connect the system to your unit’s electric meter and enjoy the benefits of reducing your electricity bill and your environmental footprint. If you decide to provide solar electricity for your rental units, your solar benefits will depend on the electric metering and rental agreements for your building.
If the tenant pays their own electric bill: If the tenants living in your units pay their own electric bill each month, the addition of solar power can help them reduce costs.
Since your tenants’ electricity bills will be reduced or even eliminated, a solar PV system can be an attractive amenity for your property.
If tenant electric bills are included in rent: If you pay your tenants’ electric bills each month and this service is included in the rent, installing solar can reduce your monthly operating costs.
Solar panels produce electricity for 25+ years, so installing them can also provide a nice return on investment for your property. Even if you go solar with a lease, you could see savings from day one.
In addition, going solar can:
- Reduce the cost of electricity in building common areas
- Serve as an attractive amenity and marketing tool for your property
- Integrate sustainability as a unique feature of your real property portfolio
Note that Southern California Edison offers several metering options for multifamily rental properties that go solar.
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How Tenants Can Encourage Multifamily Building Owners to Go Solar
Solar appeals to West Hollywood residents that care about the environment and lower electricity bills can make a big difference in monthly budgets. Below are tips for renters interested in encouraging their building owners to go solar.
- Show your building owner the value of this investment
Your building owner knows that his or her rental property is an asset, and like any asset its value will increase with an investment. Recent studies have shown that clean energy systems actually increase property values. They also make the property more attractive to both buyers and renters. Renters are less likely to leave, but if they do, the amount of time it would take to sell or rent the property is reduced significantly. Conducting thorough research and using tools such as a solar calculator that provides you with savings estimates can result in valuable information to make the case for solar to your neighbors, property manager, and/or building owner.
- Get Buy-In From Neighbors
Be proactive and share your idea and motivations with your neighbors – without their support, a successful solar project will be very difficult. Make yourself available to answer questions, and have information prepared that addresses the costs and benefits of moving forward with a solar PV installation. Emphasize the potential for savings and the benefits for tenants to make the case for a solar installation.
- Show your building owner how this could work
One of the biggest stumbling blocks for any building owner will be the purchase price of the system. Let your building owner know that you are willing to help finance the system by paying the amount of money you were previously sending to the utility company or by paying a fixed premium on rent. By making a direct payment to your building owner equal to what you were already paying to heat or power your home, you can put a cap on the amount you pay for energy while providing your building owner with an income stream to pay debt service on the clean energy system. You can also inform your building owner about the Property Assessed Clean Energy (PACE) Program—an innovative financing alternative for renewable energy property improvements.
Direct your building owner to EnergySage’s Solar Savings Estimator. The owner or property manager will be able to see directly how much money can be saved by going solar!
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Know Your Solar Financing Options for Landlords
There are plenty of financing options available to help you go solar. Whether you decide to buy your solar PV system or lease it from a third-party owner, solar can provide significant financial benefits with no money down.
Buying a Solar Energy System
Purchasing a solar energy system is your best option if your primary concerns are long-term financial benefits and flexibility. However, to buy a system, you will need to make an upfront investment, or get access to capital through a traditional lender, or finance it through the Property Assessed Clean Energy (PACE) Program.
By purchasing a solar energy system, you can gain access to state and federal tax incentives that help to reduce your upfront costs. When you own your system, you may also qualify for tradable renewable energy certificates (TRECs), an additional stream of income that can increase returns on your investment. Owning a solar system can also add to the value of your property.
If the property is owned by a corporate entity, you may also be able to recover some costs through depreciation. (Consult your tax advisor if you have any questions about how this might work.) However, some of these benefits are expiring soon – now is the best time to go solar if you want to take full advantage of incentives.
There are plenty of solar loan options available to help finance your solar PV system purchase with little to no money down, while still delivering the financial benefits associated with ownership. Go Solar California also discusses solar pricing and financing options that may be available to you.
Leasing a Solar Energy System
Leasing a solar PV system is a great low-risk opportunity to reduce your electricity costs. While the financial benefits of a solar lease might be lower than if you owned the system, solar leases have no upfront expenses and do not require you to take out a loan.
Leasing arrangements also offer energy production guarantees and maintenance services, offering peace of mind that the system will always produce energy without incurring any unexpected costs. However, systems owned by a third party are not included in property value assessments, so they have little to no impact on the value of your property.