Posted 16 July 2012 - 06:29 PM

Hello Tom

My name is Jeff Moore and I am the Director of Technology Integration for Environmental Power & Water Generation and associate director of E3 Wise.



First I would like to welcome you to Alt. Energy Shift and thank you for your participation in the online forum.

Secondly I would also like to thank you for your thoughtful question regarding renting of rooftop space for solar energy. I would like to make clear that I like your idea and that the information I am providing is to provide background and should not be taken as reasons to dissuade you, but is simply given for consideration. I have always been a person who believes that great ideas can be accomplished even if hard answers need to be found.



Leasing of roof space for solar energy has been occurring on the commercial scale for a few years and has been growing slowly over time. The reason it has worked for commercial applications are purely economic in nature.



Firstly commercial applications allow the ability to install large solar arrays that yield ½ Mw or larger. This is important for economy of scale and payoff over time. Simply if one roof can yield 1 MW the ability to negotiate larger kilowatt rates provide the ability to pay off the system faster. This is true because it takes fewer inverters, smart meters and so on for one location; where as to do the same type of application with residential homes would mean that 15- 20 homes would have to be provided to accomplish the same energy production. Meaning where as you would need 2- 3 large inverters for commercial you would need 15-20 for residential adding significant costs.



Second is the coding of commercial properties which are usually much stringent than residential properties. This means that few if any additional structural additions need to be made for commercial property, where as many residential properties would need to have roofs strengthened to be able to support the weight and wind loads for solar applications. This is a minor reason but one that investors use as a reason for commercial leasing over residential.



Third is the pitching of commercial roofs as opposed to residential. Many commercial roofs are flat with a 5- 10 degree slope that allows rain to run off, but yields a large flat space to orient the solar to the correct orientation for best take advantage of the solar elliptic thru the day.



Fourth the ability legally to lease space for commercial property is much more established for commercial property. Most states have commercial leasing laws well spelled out and view rooftop space in the same regard as floor space, meaning that long term leasing is much easier legally and provides investors with legal recourse should the owners default on the terms of the contract.



Currently several groups are leasing space on school rooftops. The ability to place them on schools provides large areas with minimal obstructions, and schools have some of the most stringent building codes. Because schools are a specific use building investors can be assured the building will remain a school for many years in the future. Likewise it allows for fixing electrical rates for long periods of time in either a percentage of sales to the utility, or a long term contract for reduced rates to the school with the investors taking advantage of the federal and state incentives to help pay off costs more quickly.



Now with all that said just because no one has come up with a economic model for grouping of residential properties together into an independent power provider group does not mean it is not possible.



I personally like the idea you have presented but these are some of the issues that will need to be confronted to develop a marketing model that is attractive to large investors.



Be advised that states that have incentives and Renewable Portfolio Credits or Standards will be your best bet. Currently the best incentive have been for larger properties such as commercial building because buildings require almost 70% of the energy needed today nationwide, where as residential is just under 30%, so federal and state governments have focused on these first and residential properties second.



Our dream has always been to provide generative power locally to residential as well as commercial buildings, as designers of alternative energy and water applications I can honestly say that a full 95% has been commercial because those are the people who have the money and property equity to qualify for incentives and financing.



I guess what I am trying to say is that your idea is a good one and we support the premise, work will have to be done to work around the issues that I have written about. That said the biggest factor in your favor has been the drastic decrease in the cost of solar cells and as they continue to fall your idea will have more and more credence. Personally I feel that being able to reduce costs to average consumers, generate equity and long term revenue for home owners is a very worthwhile goal and deserves much more attention.

