Oakland Association of REALTORS®

The Economic Correlation of Solar Energy and the

Realty Business

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Energy

About Bijou Lulla

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Founder 1Source EnergySeveral years experience marketing Renewable

Energy SolutionsTo know more about me, connect with me on:

www.linkedin.com/bijoululla

https://www.facebook.com/EnergyMaestro

https://twitter.com/EnergyMaestro_1

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1Source Energy

Purveyor of

Green Energ

y Solutio

ns:

•Solar Energy •Electric

Vehicle Charging Stations

•Natural Gas Contracts

•Home Energy Management Systems

www.1sourceenergy.us

Has an Impact on Home Values

The Business of Energy

Perspective for a Realtor

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Energy Use Data

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Residential: Electricity sales to the residential sector (blue line) accounted for

36% of all electricity use in 2012, up from 33% in 2000. In 2010, coming out of the

recession, year-over-year residential sales increased 6%, and subsequently

declined 5% over the following two years, despite growth in the housing stock and

the trend of building larger homes..

Energy Use Data

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National solar PV capacity is growing rapidlyConsumers are looking at Solar as a prospective source of

Energy

Energy Use Data

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Californians pay a higher rate for Electricity as to the national average, electricity expense consumes a bigger portion of

Household budgets

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The surprising part about people investing in Solar PV is that majority are from the middle income group of $75,000-$100,000

Median Income growth is under pressure

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Electricity Prices continue to rise faster that Income Growth

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Energy Costs are consuming a large part of household budgets – Consumers are looking at Energy Efficiency as a feature in New Homes

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Lifetime cost for an average homeowner over 25 years for Utility Use

Period

Utility Inflation Factor

Utility Payment

2013 7.0% $1800

2014 7.0% $1926

2015 7.0% $2061

………. 7.0%

2038 7.0% $123,618

Making timely investment in Solar Energy or Energy efficiency improvements can help in building a corpus for your Child’s college

education or other lifestyle benefits

Eff ects of Residential Photovoltaic

Energy System on

Home Sale  prices 

STUDY FINDINGS

Lawrence Berkeley National Laboratory

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Scope of Study

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Homes fitted withSolar Energy Sell Faster

Homes fitted with Solar Energy Sell at a Premium

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Study Findings

Premium Range:

Low $3.90 per Watt

High $6.40 per Watt

Median $5.50 per Watt

The Median price per watt to install Solar today is close to

$5.50 per watt

Homeowners can recoup their investments at cost if they

choose to resell

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Approaches to Valuing PV Rooftop

Income Approach Replacement Cost Method

Comparable Valuation

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Valuing Solar Lease v/s Ownership

Solar can be owned like any assetSolar can be leased like any asset

Transfer through sale of PV Owned System relatively straightforward and determined using standard valuation tools as discussed.

Transfer of Lease more complex:• Understand lease terms an stipulations• Lease valuation – could be either IN or OUT of Money

depends where Solar Prices and Electricity rates are at that point in time

• Credit profile of New Owner

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Commercial Properties – Energy Efficiency

California AB1103 – mandates the Energy Benchmarking for all Commercial Properties

Annual Energy Summary Reports are due April 01 every year for buildings measuring over:

Lack of Benchmarking will impede commercial transactions

Legislation Effective Benchmarking

Oct’ 01, 2011 Buildings > 50,000 sq ft

Apr’ 01, 2012 Buildings > 25,000 sq ft

Apr’ 01, 2013 Buildings > 10,000 sq ft

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To keep this conversation going, you can reach me on:

Tel.: (408) 660 7999Email: bi jou@1sourceenergy.us

Thank-you for your Patience

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