The benefits of solar are well known when it comes to single-family residential homeowners. However, almost half of the California population doesn’t fall in that category, as 46% of California residents rent instead of own. Despite California’s reputation for being more environmentally conscious, less than 1% of multifamily properties have adopted solar. Multifamily solar benefits both owners and residents, as well as the environment. This blog will cover the major benefits that your property is missing out on if you don’t have shared solar.
California has some big renewable energy goals, and Title 24 is one of the key policies that will help the state reach those goals. Title 24 is part of California’s building standard code that sets the Building Energy Efficiency Standards. The 2019 update required new construction to have solar, and the 2022 update will expand that requirement to existing properties. While there are exceptions to the rule, solar panels will eventually be mandated for all buildings. So, the sooner you get on board with solar, the better. Also, commercial, residential, and multifamily buildings over a certain size have to fulfill the AB 802 (Assembly Bill 802) requirement to benchmark and report building energy use to the California Energy Commission by June 1st of every year. Then, your energy usage is published online for anyone to see, including investors or potential buyers if you sell your property. Showing that you have an efficient building with lower reliance on grid electricity thanks to multifamily solar will only improve the value of your property.
Your ESG (Environmental, Social, and Governance) and LEED (Leadership in Energy and Environmental Design) ratings increase with the addition of solar panels to your multifamily property. Not only that, great ESG and LEED scores are badges of honor you can show current and future residents. It communicates that you care about the environment and offer access to clean energy to your community. LEED is the most well-known green building rating system and provides your building with an energy rating. As green housing options are more in demand by residents, your property will stand out in the market with positive ESG and LEED scores.
Multifamily solar is an investment, but it also provides a new source of net operating income. Virtual Net Energy Metering (VNEM) allows multifamily properties to receive credits for exporting excess solar to the grid just like single-family residential. However, many multifamily owners and managers are hesitant because they don’t want the headache and extra paperwork of tracking the shared solar. That’s where Ivy Energy can help. Our Virtual Grid software helps you monetize your solar power by making it easy to distribute solar energy to your residents while retaining a portion of the benefits for yourself. Having this system in place guarantees a return on investment and electricity savings for your residents.
You can attract more residents by offering renewable energy because everyone would love to save on their electric bills. But also, your retention rate for current residents will increase. In a study we completed with Fairfield Residential, a multifamily real estate company in San Diego, we found that 95% of surveyed residents would use multifamily solar if it cost less than energy from the grid. You can’t go wrong with energy savings and helping the environment.
Any investment you make for your multifamily property has to make sense financially. Our financial forecasts show that multifamily buildings averaging over 250 kWh of monthly energy consumption will pencil out for onsite solar. With VNEM credits and fewer vacancies, you can maximize the asset value and your return on investment. (If you’d like a revenue forecast for your property, contact us.)
If you are part of the 46% of Californians who rent, then you have little to no say in where your energy comes from. You may be able to offset some energy consumption with small, portable solar panels or subscribe to a shared solar project. Alternatively, you could switch to a green rate plan with your utility if it offers one, although that will typically increase your electric bill. This is why multifamily solar is so beneficial to residents! It brings access to clean energy to more people, allowing us all to reduce our reliance on the grid and our impact on the environment.
Onsite solar provides electricity at a lower cost than the grid. With the VNEM policy mentioned above, multifamily residents can benefit from excess solar power exported to the grid. This helps lower utility bills, especially when combined with adjusting your time of use to when solar power is most available. Properties using Ivy’s Virtual Grid software then distribute these solar benefits to residents in an equal and unbiased way based on actual energy usage. Ivy employs utility-grade monitoring data to ensure accuracy and savings on every bill.
When you can see your savings every month, you know you’re benefitting from the multifamily solar program at your property. Ivy offers a monthly solar bill for residents that illustrates your energy usage, what you would have paid without solar, what you pay with solar, the environmental savings, and your financial savings. We believe it's important to understand your energy consumption patterns and the benefits of solar, which is why we provide all of this in a straightforward, easy-to-understand monthly bill.
Whenever you move somewhere new, you typically have one electricity provider (or maybe two to choose from if you’re lucky). This is a monopoly that doesn’t give you options for the necessity of modern living that electricity is. With multifamily solar with Ivy, opting in or out of the solar program is easy, free, and gives you another option.
Electricity is expensive in California. For example, one study found that PG&E customers pay 80% more per kWh than the national average. On top of that, electricity prices have been rising at three times the average rate of increase since 2017. Another example, SDG&E raised its baseline energy rates by 106% over the last ten years. Multifamily solar protects residents from these huge increases in their utility bills. This benefit is twofold as residents save money, but also it ensures they will continue to afford their monthly rent payment benefitting multifamily owners.
This is just a short list of multifamily solar benefits for owners and residents, and there are plenty more. Owners can click here to learn more about multifamily solar for your property, and residents can click here to request solar for your community. Ivy Energy is an expert in the solar space and we have helped both owners and residents take the next step to renewable energy and solar savings for your property.
CA has passed laws like AB802 and Title 24, mandating renewable energy on certain multi-family properties?
Click Here to learn more about how you can comply while turning a profit with Ivy’s Virtual Grid alternative to traditional Sub Metering.