Solar Value

[Meandering]

Net Metering
States Bills Summaries as of July 30, 2014


California
Senate Bill 862 Authorized a facility of the Department of Corrections and Rehabilitation to participate in net metering programs with up to eight MW in capacity so long as it does not export more than 1.35 megawatts of electricity generated by wind technologies to the electrical grid at any time.
Colorado

House Bill 1101
Among other provisions, specified that the percentage of electricity generated by a community solar garden that is attributed to residential or governmental subscribers is exempt from property tax; a business owner of a community solar garden will be levied a property tax on the electricity generating capacity used by businesses.


Connecticut
House Bill 5115
Disqualified net metering customers from receiving solar rebates.
According to a news source, the enacted legislation was intended to close a loop hole with production subsidies and not intended to disqualify net metering customers from receiving solar rebates. The Connecticut Clean Energy and Finance Authority has adjusted their policies to address this.

Senate Bill 357 Among other provisions, provided a partial exclusion for Class I distributed generation sources participating in virtual net metering in property tax valuation beginning October 2014.


Hawaii
House Bill 1943 Amended the Public Utilities Commission principles regarding the modernization of the electric grid. Requires the commission to consider the value of enabling a diverse portfolio of renewable energy resources; expanding customer options to manage energy use; maximizing interconnection of distributed generation on a cost-effective basis at reasonable rates; determining fair compensation for electric grid services by distributed generation customers; and maintaining grid reliability and safety through modernization of the electric grid.

Indiana
House Bill 1423 Allows the owner of a private generation project to sell excess electric output generated by the project to an electric utility. Authorized the electric utility to recover the purchase price through a fuel adjustment charge. Required an electric utility to provide, upon request, back up, maintenance and supplementary power to a private generation project.

Kansas
House Bill 2101 Among other provisions, established a yearly expiration date for net metering credits for systems installed before July 1, 2014. Established three tiers of net metering capacity limits for net metering systems installed after July 1, 2014, including for residential customers; for commercial, industrial, religious institutions, agricultural, industrial, local and state and federal customer generators; and for schools. Allowed utilities to develop new rate classes or tariffs for distributed generation customers with systems installed after July 1, 2014. Made additional revisions to net metering policies beginning in 2030.


Maine
Senate Paper 644 Established the Maine Solar Energy Act. Among other provisions, required the Public Utilities Commission to determine the value of distributed solar energy generation and submit a report of their findings to the legislature in January 2015. Determined baseline requirements that must be included in the commission’s analysis and allowed for additional considerations. Established state solar energy generation goals.


New Hampshire
House Bill 1600 Amended the definition of "eligible customer-generator" to include purchasers of electricty from net metering renewable energy sources. Authorized distributed generation systems that are less than 15 kW to be exempt from an annual site visit and allows the owner of the customer-sited source to electronically report production monthly to an independent monitor.
Oklahoma

Senate Bill 1456
Authorized utilities to develop a new rate class for distributed generation customers to cover infrastructure costs. The measure will take effect in November 2014 and does not apply to customers with distributed generation installed by November. The new rate class and any associated tariffs must be created by the end of 2015 and approved by the Oklahoma Corporation Commission.

Governor Fallin also issued an executive order stating that the legislation is not a mandate for utilities to implement a tariff system for distributed generation.

Oregon
House Bill 4042 Included renewable marine energy in the list of applicable technologies for net metering.

Rhode Island
House Bill 7727; Senate Bill 2690 Established a tariff-based renewable energy distributed generation financing program, the Renewable Energy Growth Program. The program will finance the development, construction, and operation of renewable energy distributed generation projects over five years through a performance based incentive system with specified megawatt targets. Included specifications for solar energy and non-solar renewable energy projects, as well as coordination with energy efficiency programs.

Rhode Island House Bill 8010; Senate Bill 2915 Revised definitions of a municipality and a public entity in net metering statutes. Included the state of Rhode Island, municipalities, wastewater treatment facilities, public transit agencies or any water distributing plant or system within the definition of a public utility.

South Carolina
Senate Bill 1189 Authorized net metering and net metering capacity limits based on customer type. Established a voluntary distributed energy resource program, as well as a renewable energy leasing program. Tasked the South Carolina Public Service Commission with developing net metering rates.

Utah
Senate Bill 208 Amended current net metering policy, requiring the Public Service Commission and electric cooperatives to seek public comments on and to determine the costs and benefits of net metering programs. These entities may then impose a charge, credit or ratemaking structure (including new or existing tariffs) for distributed generation, based on these findings.

Vermont
House Bill 702 Among other provisions, revised the formula for net metering credits, including specific provisions for solar energy systems. Increased net metering caps to 15 percent of a distribution company’s peak demand during 1996. Expanded net metering policies for solar energy systems. Authorized a net metering pilot program for electric cooperatives and revised reporting and rulemaking processes.

House Bill 884
Exempted solar renewable energy plants with less than a 50 kilowatt capacity that are either net metered or not connected to the power grid from municipal property taxes.
http://www.ncsl.org/research/energy/net-metering-policy-overview-and-state-legislative-updates.aspx

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[Webbed Feet]

<....snip.....>

In your shoes I'd contact your vendor and see if they're aware of any local properties that have solar installs that have resold, and if so what premiums were paid in the resale market for those features.

Isn't that a bit like asking a blacktop asphalt salesman how much value new blacktop creates?

 

[Webbed Feet]

Hello Appraiser Community,

I recently had an appraisal done on my home where the appraiser specifically mentioned in the report that there was no value given to my solar PV system. <.....snip.....>

One of my long time, and on-going, pet peeves is real estate appraisers that use totally horrid, often meaningless, vague or misleading wording in their reports. Especially, when they do so with no additional commentary clarifying what in the world they just communicated. Your example is a classic. "No value given." What does that mean?

• If the intent was to say the market recognizes no value inherent to a solar system, then that appraiser has evidence of their study on that, right?
  
• If it meant the appraiser gave no value to the system, then we have a problem. If you research this forum site you'll find appraisers posting things like "I gave it no value," with some of us responding right back that it is the market that gives value or not, not the appraiser.
  
• If it meant the appraiser was instructed by the appraiser's client to not consider and reflect any market value the system might have, then depending on the appraisal assignment type there might be a problem.
  
• If it meant regarding the sales comparison approach the appraiser was unable to find any sort of market evidence regarding solar systems on residential properties, or so little there was really no data to analyze, so therefore no adjustment could be determined, and the "no value given" meant no adjustment for it, then it could be passable.

There could be other variations regarding what was, or could have of been, meant. But you get the idea. I do not know if you can tell what the appraiser meant and if you cannot tell what was meant, then there is a problem. Many members of the valuation trade have very terrible written communication habits. They often learned them from other appraisers and think their statements mean something comprehensible when they do not. Worse, many of these real estate appraisers mean exactly what their statements appear to mean, and it all too often turns out to be something that should never be happening in the appraisal of real estate.

 

[Meandering]

I get it that the communication could have been more specific and comprehensible.

But the reality of it is similar to appraising the economic value difference between using the clothes dryer or using a clothes line.

At least 4 months of Mikey's savings would be spent to pay an appraiser to value the thing, which then gets added to the cost of the thing that's supposedly saving money but is costing more in loan repayments than the thing is saving.

There is a reason we don't appraise old shoes, even if they can be re-soled extending their useful life.

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[Mike Kennedy]

One of my long time, and on-going, pet peeves is real estate appraisers that use totally horrid, often meaningless, vague or misleading wording in their reports. Especially, when they do so with no additional commentary clarifying what in the world they just communicated. Your example is a classic. "No value given." What does that mean?

• If the intent was to say the market recognizes no value inherent to a solar system, then that appraiser has evidence of their study on that, right?
  
• If it meant the appraiser gave no value to the system, then we have a problem. If you research this forum site you'll find appraisers posting things like "I gave it no value," with some of us responding right back that it is the market that gives value or not, not the appraiser.
  
• If it meant the appraiser was instructed by the appraiser's client to not consider and reflect any market value the system might have, then depending on the appraisal assignment type there might be a problem.
  
• If it meant regarding the sales comparison approach the appraiser was unable to find any sort of market evidence regarding solar systems on residential properties, or so little there was really no data to analyze, so therefore no adjustment could be determined, and the "no value given" meant no adjustment for it, then it could be passable.

There could be other variations regarding what was, or could have of been, meant. But you get the idea. I do not know if you can tell what the appraiser meant and if you cannot tell what was meant, then there is a problem. Many members of the valuation trade have very terrible written communication habits. They often learned them from other appraisers and think their statements mean something comprehensible when they do not. Worse, many of these real estate appraisers mean exactly what their statements appear to mean, and it all too often turns out to be something that should never be happening in the appraisal of real estate.

This post should be read by every consumer, lender, and appraiser in the country. It should be a "Sticky" and required reading for all New AForum members.

 

[Mikeyvee17]

Just updating everyone. I received a letter from the Department of the State of New York and they will be reviewing this case.
If there is a hearing, I will let you know the outcome.

 

[Meandering]

Hi Mikey,

You got a form letter.

Nice. But you should know,

There is nothing you can gain by taking this route, and no one will tell you the outcome of any hearing because these are civil matters not criminal ones.

Regardless, the state's calculators work just the same as ours.

Perhaps you should look at turning in the guy that sold you the panels and told you it would "save you money" and/or would "increase the value" of your home.

Because really, that is the guy that cost you money and needs to stand behind the pitch he sold you on.

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[Cigar]

Why do you care if the solar panels increase the value of you home? I recently finished a $1,000 a square foot home in Silicon Valley, I did all kinds of things that appraisers will not give a penny's increase in value for, a full steel frame for earthquake protection at about an extra $400,000, a Japanese tile roof from a special clay pit in Japan that cost an additional $133,000 over a regular tile roof, a fireproof structure that I spent $26,000 alone for fire dampened foundation, soffet and ridge vents, rift grain walnut floors that the rift grain alone cost $14,000 more, I can go on and on about the features of that home that my owner wanted that will not increase the appraised value by one cent. I recently spent $7,000 changing the rocker arms in my Viper that will give me 13 more horsepower but won't increase the value by a penny, I'm awaiting delivery today of new coil-over shocks that when installed will cost me $4,000 that will not increase the value of the car.

We all spend lots of money in our lives buying things that do not increase the value of anything, we buy them because we want them, so where did the OP get the idea that since he wanted solar panels that they would increase the value of his home? I take it a solar salesman lied to him, his recourse would be to sue the solar company for misrepresentation.

 

[George Hatch]

Just updating everyone. I received a letter from the Department of the State of New York and they will be reviewing this case.
If there is a hearing, I will let you know the outcome.

Reviewing complaints is part of the board's job description - they're probably obliged to review 100% of all complaints.

In most states the only time there'd be a hearing would be if the appraiser wanted to contest an allegation that they actually wanted to impose discipline for. In most states that discipline can range from getting a don't-do-that-again phone call >> getting a nasty letter in their file >> the nasty letter with a small fine >> license suspension >> license revocation.

NY State might be different, who knows? But in most states a technical error involving an element that most reasonable appraisers would agree is an error would generally be maxed with a small fine. Suspensions and revocations are generally reserved for very serious ethical misconduct. Matters of style for which there is no widespread consensus - like this issue - would not generally result in discipline because the burden of proof to *prove* unlawful conduct by a licensee rests with the state, not the licensee.

 

[Terrel L. Shields]

John Brenan - appraisal guy with The Appraisal Foundation - would argue that solar panels do add value. I've never been a fan of the idea that expensive fixed items have "no value" - outbuildings, pools, solar panels, whatever. Only items of extravagance would qualify as totally irrelevant. At a hearing last week before the state corporation commission, OG & E was asking for clarification of paying a flat fee per month for everyone (i.e.- that part of the bill would be required to be paid by all, net metered or not). There were dozens of protestors who wanted to not even be charged for the hook up to electricity. Obviously, they see a "value" to solar and wind, and as such, it is almost certain that there is a "value" and the resistance of appraisers to even acknowledge it exists says a lot of not very nice things about the bias of this profession and the failure to recognize it.