Do solar PV panels add value to your home? The U.S. Department of Energy thinks so
The study was focused on California, but new research from the U.S. Department of Energy’s Lawrence Berkeley National Laboratory could give us a peek into how home valuations across North American are affected by the installation of rooftop solar PV systems. The research was based on an analysis of 72,000 homes sold between 2000 and 2009, of which 2,000 had rooftop PV systems at the time of sale. It found that, on average, the premium fetched through the sale of the home more or less matched the initial capital investment in the solar PV system. In other words, not only does a homeowner benefit directly from the clean energy produced while living in the home, but they get a return on their initial investment through the sale of their home. Looked at this way, it dramatically changes the economics of purchasing a rooftop PV system.
The Berkeley Lab research is the first to empirically explore the existence and magnitude of residential PV sales price impacts across a large number of homes and over a wide geographic area. “This is the most comprehensive and data-rich analysis to date of the potential influence of PV systems on home sales prices,” says co-author and San Diego State University Economics Department Chair Mark Thayer. The research controlled for a large number of factors that might influence results, such as housing market fluctuations, neighborhood effects, the age of the home, and the size of the home and the parcel on which it was located. The resulting premiums associated with PV systems were consistent across a large number of model specifications and robustness tests.
There’s no saying this research is representative of other markets, such as Ontario, where general attitudes and perceptions of solar technology are likely quite different from those in California. However, it’s encouraging to know that if a homeowner does invest in such a system as part of participation in the province’s feed-in-tariff program, there’s a good chance that if you decide a few years later to sell your home there’s some like-minded individual out there willing to pay a premium in recognition of the investment you have made. An Ontario-focused study, similar to the one done by the Berkelely Lab, should probably be done in the 2013-2014 timeframe. Perhaps this is something a university, such as Queen’s or U of Waterloo, should start planning.