1. Financial Pros and Cons of Residential Solar Installations: A Residential and Municipal Perspective Joshua Brock Environmental Specialist City of San Diego

2. Outline Background –Goal of the survey and focus groups –The Process The Survey –Who we surveyed and who responded –Review of results and what they mean Focus Groups –Breakdown of the 3 groups –What we learned Bringing it all together –What this means for residents –What this means for a municipality

3. Background

4. Background & Goals Department of Energy, Solar America Initiative Grant What can the City of San Diego do to increase the penetration of Solar PV in the market –Identify challenges and barriers customers face –Find out what motivates residents to install a PV system –Examine how a PV system affects the value of a property

5. Thinking Caps Mailed Survey Crunched Numbers Thinking Caps Again 3+1 Focus Groups Final Results

6. The Survey

7. Who Participated? Residents and Businesses that had installed a solar PV system in the last 10 years; 2000 surveys mailed, option to reply online or by mail; 641 responses or about 32%

8. The Questions How many years have you occupied the property? Who purchased the solar system for this property? How did you find your solar installer? Were you satisfied with the installation process? What, if any, were some barriers you encountered? Would you have installed your solar system without a rebate offered? Did you do any energy efficiency upgrades before or in conjunction with your solar installation? Are you more conscious of your energy use after installing your solar system? Have you had questions or comments from your neighbors about your solar installation? Do you feel you are saving money on your electric bill as a results of your solar installation? Did any of your friends or relatives install a solar system due to your example? Would you expect your solar installation to increase the value of your home? If so, by how much?

14. What We Learned: Personal references and Google not NPR and direct mailings; Incentives and Tax Credits drive the market; Perceived value of about $5,000/kW installed; On-going training for Installers and Permitting/Inspections staff; Residents may not understand why energy efficiency is important;

15. The Focus Groups

16. Who Participated Real Estate Professionals (Sales, Appraisers, Brokers) Municipal Permitting/Inspection Staff Homeowners with a PV System Solar Installers Meeting

17. Focus Group Results Real Estate Professionals –Market does not value PV system as high as their costs merit –Bills showing energy savings needed to value the system, but older systems are looked at as a liability –Most real estate agents do not highlight a PV system as a selling point Municipal Permitting/Inspection Professionals –The Fire Departments role needs to be better defined –On-going training for city staff and installers needed

18. Focus Group Results, Continued Homeowners with a PV system –Generally very happy with system. Like having a stable bill –Want to install more but need a financial incentive to do so. Meeting with Solar Installers –Costs of permits not an issue –Would be willing to pay more for quicker permit processing and inspection

19. Bringing it All Together: The Residential Sector Pros –Stable utility bill and protection from rate increases –TOU tariff could help reduce payback if exported kWh is properly valued Cons –Failure to perform meaningful energy efficiency upgrades early on could mean future upgrades increase system payback –No guarantee that a PV system will increase the sale price of your home.

20. Example Energy Savings Solar Only 20 Sample Home: 1500 Sq Ft 3Bd 2Ba Location - Tierrasanta Home Value - $ 467,500 Annual Prop Tax - $ 5,049 PV System Size (AC) - 4.50 kW Energy Efficiency - None Financed Amount - $ 36,638 Loan APR - 7.00% Positive Cash Flow – Year 1 Average Monthly Savings - $ 236.55 Monthly Tax Increase - $ 288.20 30% Federal Tax Credit Replace Inverter Loan Paid Off

21. Example Energy Savings Solar and Energy Efficiency 21 Sample Home: 1500 Sq Ft 3Bd 2Ba Location - Tierrasanta Home Value - $ 467,500 Annual Prop Tax - $ 5,049 PV System Size (AC) - 2.40 kW Energy Efficiency - Lighting, Insulation, HVAC, Windows Financed Amount - $ 36,433 Loan APR - 7.00% Positive Cash Flow – Year 1 Average Monthly Savings - $ 304.34 Monthly Tax Increase - $ 286.59 30% Federal Tax CreditReplace Inverter Loan Paid Off

22. Bringing it All Together: A Municipal Perspective Pros Permit costs are not an issue from the customers perspective AB-32 and local Climate/GHG goals Green Jobs & more disposable income Cons We may be missing out on $$! Rebates/Incentives still driving the market Undertrained permitting & inspection staff plus inexperienced installers professionals can cause harm

23. Thanks! Joshua Brock Environmental Specialist City of San Diego 858-492-5033 Jbrock@sandiego.gov