New Study Proves that PV Installations Contribute "Sizable" Value When Reselling Your Home

Homes with solar PV systems sell for a premium over homes without solar installations, according to new research by the U.S. Department of Energy's Lawrence Berkeley National Laboratory.

Although the premise that installing PV will add value to a home has long been promoted by installers and others in the industry, the new study - titled "An Analysis of the Effects of Residential Photovoltaic Energy Systems on Home Sales Prices in California" - confirms and quantifies this effect.

According to the lab, this 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. Over the past few years, an increasing number of homes with PV systems have sold, particularly in California, but relatively little research has been performed to estimate the impacts of those PV systems on home sales prices.

Overall, the researchers found that homes with PV in California have sold for a premium, expressed in dollars per watt of installed PV, of approximately $3.9/W to $6.4/W.

"These average sales price premiums appear to be comparable with the average investment that homeowners have made to install PV systems in California, and of course, homeowners also benefit from energy bill savings after PV system installation and prior to home sale," says the report's lead author, Ben Hoen, a researcher at Berkeley Lab.

The $3.9/W-to-$6.4/W increase corresponds to an average home sales price premium of approximately $17,000 for a relatively new 3.1 kW PV system (the average size of PV systems in the Berkeley Lab data set), and compares to an average investment that homeowners have made to install PV systems in California of approximately $5/W over the 2001-2009 period.

"This is a sizable effect," says Ryan Wiser, a Berkeley Lab scientist and co-author. "This research might influence the decisions of homeowners considering installing a PV system and of home buyers considering buying a home with PV already installed. Even new-home builders that are contemplating PV as a component of their homes can benefit from this research."

The lab analyzed a dataset of more than 72,000 California homes that were sold between 2000 and mid-2009, approximately 2,000 of which had a PV system at the time of sale. 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 researchers note.

The resulting premiums associated with PV systems were consistent across a large number of model specifications and robustness tests. The research also showed that, as PV systems age, the premium enjoyed at the time of home sale decreases.

Additionally, existing homes with PV systems were found to have commanded a larger sales price premium than new homes with similarly sized PV systems.

"One reason for the disparity between existing and new homes with PV might be that new-home builders also gain value from PV as a market differentiator that speeds the home sales process, a factor not analyzed in the Berkeley Lab study," says Berkeley Lab researcher and co-author Peter Cappers. "More research is warranted to better understand these and related impacts."

The full report can be downloaded here.

Photo credit: SolarCity

Indian Solar Energy Market Outlook 2012 - New Market Research Report

The solar industry has immense potential for a tropical country like India where around 45% of households, mainly rural ones, do not have access to electricity, says the new research report "Indian Solar Energy Market Outlook 2012". The industry has witnessed rapid growth over the past few years and is projected to grow further in future.

India is blessed with ample solar radiation and most part of the country receives 300 to 330 sunny days in a year. India receives solar energy equivalent to more than 5,000 Trillion kWh per year, which is far more than its total annual energy consumption. The country's geographical location, large population and government support are assisting it to become one of the most rapidly emerging solar energy markets in the world. Consequently, the country is becoming a favorite investment destination for both local and global players.

Demand for solar products has been rapidly rising for the recent years, especially in rural areas, and is expected to continue growing substantially during our forecast period (2011-2013). Solar street lighting systems, home lighting systems, power plants, solar cookers, solar pumps and solar water heating systems are the most popular applications in India. The number of solar water heating systems is projected to grow at a CAGR of about 22% between 2011 and 2013.

Many states have started promoting solar based applications by giving incentives and tax savings. States like Gujarat and Rajasthan have formulated transparent and progressive regulatory framework in order to boost the solar industry. Besides, states like Delhi, Uttar Pradesh, West Bengal, Maharashtra and Chandigarh are promoting solar energy in rural, urban and semi urban areas.

The report provides an extensive research and rational analysis of the solar industry in India. It thoroughly examines current industry trends, with focus on recent changes in the state and country level regulatory environment. The report will assist investors to understand the market dynamics and get an insight into the future outlook of solar power market in India.

Besides giving projections for various energy indicators, the report contains forecast for different segments of the solar power industry based on feasible solar industry environment. These include:

- Solar Street Lighting System
- Solar Home Lighting System
- Solar Lantern
- Solar Photovoltaic Pumps
- Solar Water Heating System
- Solar Cookers

The forecast given in this report is not based on a complex economic model, but is intended as a rough guide to the direction in which the market is likely to move. This forecast is based on correlations between past market growth, growth of base drivers and possible impact of recession in the economy.

The report also includes brief information about the key players such as BHEL, BEL, CEL, TATA BP Solar India Limited, Solar Semiconductor and Moser Baer India Limited.

To order a copy of the report:   click here