Inland Empire Association Management

I recently had a condominium association approach me about installing solar panels on the roof of their commercial building. I love these projects because nothing gets me more excited than looking at return on investment.

Electricity Meters in Condo Associations:

Each association is developed differently in regards to utility expenses for condominium complexes. The typical set-up for electricity in condominium complexes is to have one house meter and separate, individual meters for each unit owner. The house meter is paid through the association, and covers electricity usage for parking lot lights, wall packs, irrigation controllers, and other elements that are used for the common benefit of all owners. The individual meters are paid directly by the owner, and cover electricity usage for their interior lights, HVAC, machinery, and anything else that draws power for operating their business. That is how I typically see electricity set-up, but I have seen associations where the electricity is on one meter, and expenses are shared on the pro-rata share outlined in the CC&R's. 

Where does solar energy get complicated for condominium associations?

Most of the boards I’ve worked with on solar projects want a solar energy company to install the system at no cost to the association. In these circumstances a solar energy company owns the equipment they install on the association's roof, and they sell the energy generated from the equipment back to the association at a lower cost than SCE. Here’s the problem: This option requires a lot of electricity use to save any money because the company that installs the solar panels for free needs to recoup their costs. To save money with this option of solar energy every owner that is individually metered needs to contract with the solar energy installer. For example, take a park that has fifteen individual meters and one association meter. Then there would need to be sixteen contracts in place (15 owners + association meter) for this to actually save anyone money. It's all about economies of scale to return on this investment. 

The other complication is there is usually one HVAC unit on the roof for every condo unit.  That usually means there is very limited space for solar panels. Less space on your roof for solar panels means you cannot generate as much electricity. Limited space on the roof typically means solar panels are sectioned off to one area of the roof.  If this is the case running a conduit to service each owners’ electrical meter can become very costly, and off-set the ability for the solar company to be competitive with the rate SCE is charging.

Conclusion:

Solar energy is a great option and can work, but every case is different. Think about what your community is willing to spend, not spend, and the available space you have to make the project work.