Shining A Light On Solar Power

Shining A Light On Solar Power

Silver Asset Services Shines A Light on Solar Arrays

We shine a light on solar power to see whether it is worth developers considering installing a solar array in their next new development or whether retrofitting existing buildings stacks up.

With the Australian government committing to a target of limiting global temperatures by 1.5 degrees Celsius as a result of the Paris Climate Conference, there is likely to be a renewed focus on renewable power.

While many suburban houses are sporting solar panels, the uptake on developments, particularly high rise projects and retro-fits has been a lot slower off the mark – and there may be good reasons for it.

Despite government rebates and incentives, installation of solar panels is still an expensive option that may not make financial sense for new-build developers.

Here were look at the pros and cons in a snapshot, then go into some of the specifics that developers will need to consider at both the time of construction and further down the track should a strata community decide to install solar.

Pros

  • Provides a marketing advantage
  • Reduces electricity bills for owners and tenants
  • Options to generate income
Cons

  • Expensive up front installation
  • Requires commitment during design or
  • Requires BC buy in afterwards
  • Must sacrifice roof top real estate
  • Replacement must be included in Sinking Fund Costs

Developers looking to attain Green Star ratings for their projects, might consider the installation of solar power in addition to passive energy efficiencies.

The Green Building Council of Australia says its 40% year-on-year increase in Green Star certifications proves there is a growing market for environmentally friendly buildings.

While much of this growth has come from commercial developments, a number of residential developers are looking at certification as a tangible way of demonstrating environmental commitment to purchasers.

Solar power’s most immediate advantage is to power common areas including pools, garages and garden areas as well as being directed to individual lots to reduce electricity bills.

Body corporate and owners corporations which generate sufficient amounts of electricity may also take advantage of various feed-in programs and generate income which can be allocated to used to add to sinking funds/capital works funds which may result in a strata community being able to advertise lower than average levies.

According to one solar energy provider, the typical return on investment for a solar PV system in Australia is in the range of 15-22%, with payback periods of 4-7 years. The life of a solar array is about 25 years.

In addition to feed-in tariffs, governments are also offering incentives to retrofit buildings. Melbourne’s largest solar retrofit has been installed at Mirvac’s Yarra’s Edge apartments, thanks to support from council rebates and the national Smart Blocks program.

The owner’s corporation used a City of Melbourne $3000 solar rebate and advice from Smart Blocks to install a 47.5 kilowatt system at a cost of $67,000 – though only $230 for each of its 290 residents.

And those financial incentives are needed. This is not a matter of whacking a couple of solar panels on the roof.

Inspections must be carried out to see if the building infrastructure can carry the weight and spot loads (such as heavy wind gusts). In addition, solar inverters need protection from the weather and racking systems for the panels may require the rooftop area to be strengthened or water membranes to be updated.

Of course, roof top solar arrays sterilise the area for other uses such as roof top garden and common amenities such as sundecks and barbecue areas and this needs to be taken into account.

But fear not, one day it might be possible to have both.

New innovations such as completely transparent solar cells to replace windows in multi-storey buildings could be a cost effective option in the future.

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