Solar is Heating Up the Market

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Real Estate

Solar Adoption is Growing

Two years ago, the U.S. had hit 2 million solar installations and the researchers at Wood Mackenzie Power & Renewables expected " installations to double by 2023." In fact, Pew Research found that 46% of U.S. homeowners are considering residential solar panels.

High demand can lead to a faster sale and/or a higher sales price, but there are still a few other factors that will impact the value of your home on paper.

Location Considerations
According to a 2019 Zillow Economic Research report, “During the past year, homes with solar-energy systems sold for 4.1% more on average than comparable homes without solar power. For the median-valued home, that translates to an additional $9,274,”

The report finds, however, that the increase in home value varies, sometimes substantially, by region. If solar panels are popular in your area, they may provide a bigger boost to your home value than in less popular areas.

Owned or Leased?
When you sell your home to a buyer who will need financing to purchase it, the appraiser has the final say in what the home is worth. Whether the solar array on your roof increases the appraised value will depend largely on whether or not you own the system.

The most common solar panel ownership scenarios, according to the appraiser guidelines at, include:

  • The panels are owned.Owned panels may be included in the appraised value of the property.
  • The panels are leased or covered by a Power Purchase Agreement.Leased panels may not be included in the appraised value of the property.
  • The panels are financed as personal property.If the solar panels are financed as personal property (and therefore serve as collateral for the loan), they will do nothing to increase the value of the home.
  • The panels are financed as fixture to real estate.Panels that are considered fixtures (permanently affixed to the property) can be used in the appraisal but only if they can’t be repossessed should the seller default on the terms of the financing agreement.

If you decide to purchase solar panels, you will likely be able to someday recoup the money you spent on them. If you’re located in an area where solar power is popular, your system may just help you to sell the home quicker. If you’d like more information on our local market conditions, reach out to me anytime.

NEM Factors & Why You Should Act Quickly if You’re Considering Solar

Net metering–or NEM–allows you to earn credits for any excess solar electricity you send to the grid when your solar panel system generates more than you need.  

Over the next year, California will be releasing the third iteration of net metering, or NEM 3.0.  There’s still a lot for the state to decide on – we don’t know exactly  how credit values will change, or what they’ll change to, but we do know that whatever  happens will have large implications for the country’s leading solar market.

Proposed changes to CA’s net metering policy could cut the value of solar credits by up  to ~75 percent 

  • Utilities are recommending two fees for solar customers that, combined, could cost new  PG&E, SCE, and SDG&E solar customers more than $100 per month on average • This is a big one: existing solar customers will be grandfathered into their original net  metering policy 

In addition to reducing the value of solar credits, utilities are asking the CPUC to implement two  monthly charges for solar customers: a grid benefits charge, and a customer charge. Both are  intended to help the utility recover costs associated with the upkeep of transmission and  distribution infrastructure, meters, general billing costs, and non-bypassable charges, all you still  use as a solar owner but which you may not explicitly pay for under one-to-one net metering. 

Assuming the CPUC moves forward with the utility company’s recommendations, your grid  benefits charge will be a monthly fee based on the size of your installed system, ranging  anywhere from $7 to $11 per kW per month depending on your utility company. To put that into  perspective, the average quoted system size in California on the EnergySage Marketplace is  about 8.2 kW – for a system this large, you would need to pay an extra $57 to $90 on your  utility bill each month, or $700 to $1000 per year (!!) for the right to have solar. 

The second suggested monthly fee–the customer charge– would tack on an extra $12 – $24 to  your bill, regardless of system size.

What Should You Do?

If you’re considering solar, talk to an expert to find out if it makes sense for your home and energy usage. It’s free to have a consultation and I can recommend a colleague, Solar Dan who can help you navigate the many options.

Dan Herman, Energy Consultant -- Solar Energy Partners -- 949.573.3259