Solar power for renters? There’s a lot of talk about Australian house prices, along with prices for solar panels and batteries.
But what about the people who rent a house or apartment? Is it worth looking into solar panels when you don’t own a property to put them on?
The answer is yes. New research suggests there’s a large, untapped market for those renting and looking for the advantages of renewable energy. And there are now options for solar power for renters. There are new schemes helping tenants get access to solar, options to share their energy, p2p, and more. Of course, renters need to look at the options and get the best solar quote, but tenants are a growing population and their lack of access to solar cannot be ignored.
This Energy Matters article examines the options for installing solar panels and home batteries, even if you don’t own the property you live in.
Split incentives: tenants and landlords
The potential for solar power for renters is there. Figures show only 45 per cent of younger people own a home, a number that’s been declining for years. As a result, Australian renters are searching for more innovative solutions to lower their bills.
Solar is the best option. But a major obstacle to installing solar for rental properties is that while renters see the advantage of lower power bills, landlords do not.
As reported in Energy Matters, there is a way around this. It’s called “split incentives” and involves splitting the costs and the benefits of a rental rooftop system between tenant and landlord.
One new business, SunTenants, has partnered with Energy Matters to install solar on rental properties. SunTenants seeks to solve the split incentive problem by sharing the benefits of solar between tenant and landlord. Here’s how it works:
- SunTenants analyses the proposed solar systems and calculates a fair increase in the property’s rent that achieves attractive returns for owners, while ensuring that tenants save tenants money on their combined rent + energy expenses.
- SunTenants helps both parties see these benefits and arranges the solar install (with Energy Matters) and lease renewal.
- To ensure the arrangement remains fair, the solar system includes an advanced smart meter that SunTenants uses to monitor the system, providing regular reports to owners and tenants.
“We’re empowering owners and tenants to unlock the solar potential of their rental property with a simple, fair and transparent way to both benefit,” said Dr Bjorn Sturmberg, founder of SunTenants.
Landlords to get interest-free loans?
There are other ways to help renters get solar power. One community group in regional NSW called Z-Net Uralla recently teamed up with the not-for-profit CORENA fund (Citizens Own Renewable Energy Network Australia) to give landlords interest-free loans to install solar on their rental properties.
CORENA also helps broker a fair rent increase to help cover the cost of repayments. “We are hoping that the partnership can be a model for communities elsewhere to copy,” Margaret Hender of CORENA told ABC news.
“We make sure that any rent increase is no more than half the savings that the tenant will get from having solar installed.”
There’s an initiative among local councils to offer landlords interest-free loans that can be paid off via rate instalments. Under the “solar savers” scheme pioneered by Darebin City Council in Melbourne, landlords can even transfer their loan to the new owner when the property is sold. Darebin is now targeting landlords, which means renters will be able to negotiate a rent increase to help cover the loan repayment.
There are also commercial schemes to help manage a landlord-tenant agreement. A few of these are described in a recent article in the ATA’s ReNew magazine, along with some options for apartment dwellers, who face their own unique challenges installing rooftop solar.
Solar gardens – the renters’ array
Solar gardens aren’t the industrial farms we are hearing a lot of about. They are solar arrays, where several solar panels are combined and set up in a private location. It’s a bit like buying into a communal kitchen garden so you can grow your own vegies.
They are an alternative model to rooftop solar. Renters can buy or lease a number of panels in small scale array directly connected to the grid in a location removed from where they rent. They then get paid for the energy they generate by the retailer.
In other words, you don’t have to attach the solar panels to your residence or small business. You can use digital meters or behind-the-meter tech and see how much power you are getting from your remote solar garden array.
An example of this is Enova Energy, as reported in the Sydney Morning Herald. Panels can be sold when or if you move, so you are not locked into an investment. The payback amount depends on the original investment when you move and the feed-in-tariff. For more information on FiTs check out this Energy Matters article.
Solar power for renters: Share your power
This concept of community-owned solar is one of the biggest trends right now. It includes solar farms, solar gardens, and also other solar projects owned by a municipality, utility, co-op or other organisation. Participants typically pay a monthly fee for the energy provided by this off-site solar installation. In return, they get a credit on their utility bill for the energy generated by the panels.
If your property already has solar panels, there’s also the option of turning your extra power to profit by sharing your energy with your neighbours. Peer-to-peer energy trading is the next major revolution ahead, driven by the uptake in home batteries.
Currently, any excess power your solar panels generate is either sold to your retailer or simply wasted. However, new technology allows you to sell it to other people on a virtual grid.
One Australian company, PowerLedger, uses blockchain technology to create a transparent and record of energy generation and consumption. This allows consumers to trade energy with their neighbours automatically.
A future of solar for all
Australia is being held back in its renewable energy goals by the reluctance of some of its landlords to adopt solar energy. But as we’ve seen, there are options for solar power for renters that involve negotiating with their landlords for a “split incentive” deal.
What incentive might a landlord have to go solar? Well, solar panels are a great way to improve the desirability of the rental property and reduce vacancies.
As Australian electricity prices shoot up, why can’t renters access the benefits of renewable energy just as much as homeowners?