Value of whole home solar PV system

[J Grant]

At some point a genius will find out how to efficiently harness solar power. I read that engineers devised a tiny engine as thin as a hair. The problem is the big clunky engines, systems, and batteries the solar power has to drive, which need to be re engineered, or a missing link to compress the energy invented..

Whoever the genius person is in future to channel the energy, that person will be Bill Gates level rich .

It will happen-imo within the next decade plus. Whenever there is intense demand and interest, eventually a genius comes along and unlocks the key (often hidden in plain sight ). The early efforts ln retrospect are seen as crude, but they served a purpose (a stepping stone in the evolution to the solution.)

 

[J Grant]

Getting back to the OP question: Most agree this acts as a seller concession.

All the meandering about leases and mortgages and kw per hour are a distraction from the analysis for appraisal purposes. The analysis reveals this acts as a concession /incentive to buy. The seller states is worth 40k in prepaid energy savings. Whether it will really save that $ amount in future is not the issue, the issue is whether or not the concession inflated the purchase price -which will be, known after the appraised derives their market value opinion .

 

[Carnivore]

Until Scientist and Engineers develop a Relatively inexpensive and Effective/dependable way to store Solar derived electricity AKA PV's , they simply are not going to be cost effective for a Homeowner. Battery Advancements are moving forward. One way commercially is to use Solar to create Hydrogen. That can't be done for Homeowners because it is just to dangerous. Something like "Hey Everybody Watch this!" kind of thing.

 

[J Grant]

Until Scientist and Engineers develop a Relatively inexpensive and Effective/dependable way to store Solar derived electricity AKA PV's , they simply are not going to be cost effective for a Homeowner. Battery Advancements are moving forward. One way commercially is to use Solar to create Hydrogen. That can't be done for Homeowners because it is just to dangerous. Something like "Hey Everybody Watch this!" kind of thing.

I have no idea how it will be done (if I did I'd be rich), but trying to make each home and car its own re generating of solar power saved in clunky batteries is too inefficient - perhaps a central solar bank in communities where the power is harnessed and stored in super efficient batteries, with the batteries swapped out every month back to the center by consumers for a recharged set - who knows wish I could invent it ! Probably even that is too clunky, and the real invention will be small and very consumer friendly/portable , as an iphone became a portable scaled down computer device

 

[Renee Healion]

Florida...My subject has a new whole home solar PV system which was not known until the inspection. Client/Lender did not request a Green certified appraiser. Information on determining value is scant, unless you are a AI member and take their courses and earn their Green designation.

2860 sq. ft home
9.8 kW rated system (35 x 250w panels)
pvwatts.nrel.gov calculator estimates system output 14,700 kWh/year.

System is currently offsetting a $500/month energy bill, panels are owned (financed over 20 years).

Now what?? Thanks in advance...

Found a 1-hour McKissock webinar: Appraising Solar Panels- A Primer

In this morning's emails, there was an ad from AI about online courses. I noticed the section for valuing sustainable buildings has a newer online class called Valuation Resources for Photovoltaic Systems. How many hours is not clear to me and it is important to check with your state for approval. This one may be more pertinent to residential appraisers than the class that I took (which was the only PV class at the time). The earlier was 10 case studies on commercial, industrial, and residential properties and covered leased systems, PPAs, but not utility scale. And of course, the technology and components of the system.

I think the title of the last one, let alone the breadth of it, put off residential appraisers. This one seems to have been created to specifically address residential appraisal concerns.

It deals ONLY with host-owned systems. The difficulty many appraisers have expressed here on finding a pv system on a subject is identifying who owns the system. (Someone always owns it.) If you are doing lending appraisals, you want to be able to identify the various types of ownership and use, but what matters most in that practice is host-owned.

The tech is different. The field is under constant change. There is a lot going on. But the appraisal methods are the same as ever: sales, cost, income approaches. Fannie drives the residential pv car by requiring appraisers who are qualified at the time of acceptance. That is interesting to me, because the qualification depends on employing the three fundamental methods, yet, Fannie, itself, is most responsible for the atrophying of res appraisers skills. Fannie so focuses on sales to the diminishment of the other methods, that res appraisers, who learned the three approaches at their career outset, have since, in daily practice, relied almost entirely on the sales approach to the effective exclusion of the others. Cost is a joke in most reports I read; it cannot be replicated. Income is dismissed with a sentence. I think Fannie turned appraiser birds into barnyard chickens. Here is a chance the grow your feathers back. Thinking in terms of three approaches is good even if you end up doing no solar, somehow.

i edited the part about hours of credit and state approvals

 

[Carnivore]

John Denver once got caught having a Large Gasoline Tank buried on his Property during the Gas Shortages.

This made me think of having 5,000-10,000 gallons or more of underground water storage for heating. Imagine you have solar energy heating the water in those tanks(aka Battery) in the summer and supplementing your heat needs in the winter with circulatory pump.

Don't have any idea of the cost but the maintenance should be pretty cheap.

Thermal Storage – Darco INC

darcoinc.com

 

[J Grant]

DEFINITION OF MARKET VALUE: The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale,

That is why in a MV purpose appraisal, the focus for credible results is on the SALES comparison approach , and that has nothing to do with Fannie. It comes down to a fundamental truth: no matter what it cost to build /anticipated income stream, the market is paying X $ on sale. Of course the cost approach and income approach can be useful and informative. But at the end of the day, the market speaks - atincpated income gets baked into sale prices, and no matter the cost, the market pays X$ ( which can be less than, more than , or equivalent to cost ) .

In OP case, it is not an owned system , the estimated future utility savings was dangled by the seller to act as a concession. . Whether seller inflated the price to cover it not discussed by OP

 

[DWiley]

In this morning's emails, there was an ad from AI about online courses. I noticed the section for valuing sustainable buildings has a newer online class called Valuation Resources for Photovoltaic Systems. How many hours is not clear to me and it is important to check with your state for approval. This one may be more pertinent to residential appraisers than the class that I took (which was the only PV class at the time). The earlier was 10 case studies on commercial, industrial, and residential properties and covered leased systems, PPAs, but not utility scale. And of course, the technology and components of the system.

I think the title of the last one, let alone the breadth of it, put off residential appraisers. This one seems to have been created to specifically address residential appraisal concerns.

It deals ONLY with host-owned systems. The difficulty many appraisers have expressed here on finding a pv system on a subject is identifying who owns the system. (Someone always owns it.) If you are doing lending appraisals, you want to be able to identify the various types of ownership and use, but what matters most in that practice is host-owned.

The tech is different. The field is under constant change. There is a lot going on. But the appraisal methods are the same as ever: sales, cost, income approaches. Fannie drives the residential pv car by requiring appraisers who are qualified at the time of acceptance. That is interesting to me, because the qualification depends on employing the three fundamental methods, yet, Fannie, itself, is most responsible for the atrophying of res appraisers skills. Fannie so focuses on sales to the diminishment of the other methods, that res appraisers, who learned the three approaches at their career outset, have since, in daily practice, relied almost entirely on the sales approach to the effective exclusion of the others. Cost is a joke in most reports I read; it cannot be replicated. Income is dismissed with a sentence. I think Fannie turned appraiser birds into barnyard chickens. Here is a chance the grow your feathers back. Thinking in terms of three approaches is good even if you end up doing no solar, somehow.

i edited the part about hours of credit and state approvals

I took the AI course on valuing PV systems. I would highly recommend it as good, meaningful CE. My only caveat would be to count on the course taking more than the prescribed number of hours. Not for those looking for just "seat time" CE. It requires some actual work

 

[J Grant]

At some point I will take the course, but note it is a course on "valuing PV systems". Which is perfect, if the appraisal assignment purpose is is to value the PV system !
However if assignment purpose is market value for the subject, then the worth (or lack of ) a PV system becomes its contributory value to the whole, rather than the system's isolated value.)

My fear is appraisers can get so impressed with the computations of the class taught model, that the appraiser can substitute it for what the market is actually returning .

 

[DWiley]

At some point I will take the course, BUT it is a course on "valuing PV systems". Which would be perfect, if the appraisal assignment purpose is is to value the PV system !

But if assignment purpose is market value for the subject, then the worth (or lack of ) a PV system becomes its contributory value to the whole, not its stand alone value ( as a pool or any individual feature. .)

My fear is appraisers get so impressed with the complex computations of the class taught model, that the appraiser can substitute it for what the market is actually returning .

Oh - you mean like those who take regression results and apply the coefficients as adjustments with really market testing them You are making a LOT of assumptions/assertions about a course that you have not taken.