July 27, 2017
Each year Solar Power World compiles a list of companies and ranks them according to their influence in the U.S. solar industry. Ranks are determined by the number of kilowatts the company installed in the US during 2016. McKinley is pleased to announce that Restore Solar came in 325th in the nation and 10th in Utah!
[Solar Power World Magazine]
Restore Solar (No. 325) is on a mission to make solar sensible for all stakeholders of single-family rental homes. (Say that ten times fast.)
The company was launched in 2015 to install solar on a portfolio of 500 single-family rental homes that were acquired by the company’s founders in partnership with Goldman Sachs Urban Investment Group. After completing that initial project, the company began installing solar for other single-family rental portfolio owners in Utah. According to the National Multifamily Housing Council, single-family rental homes make up about 15.2 million, or 25%, of the approximately 43.7 million rental households in the United States.
Restore Solar CEO Laurence Pelosi said landlords will sometimes add solar to common areas in rental complexes, such as a small array to power a pool house, but it’s dificult for them to make solar work for tenants. Pelosi said landlords typically think, “I'm a single-family landlord, and my tenant pays their own utility bill. Why is it in my interest to put solar on that rooftop at my expense?"
Restore Solar produces a convincing reason why: The company’s new financing structure allows landlords to pass the cost of the solar lease to the tenant every month. The cost of the solar lease will be lower than the utility bill, so the tenant will be saving money too. Take for example, a landlord who installs solar on a single-family rental that previously cost $100 a month for electricity. The solar lease payment will cost about $40 to $60 a month, so the landlord can split the balance of that savings with the tenant. Pelosi said it’s a win-win. "The landlord's creating incremental—what's called NOI or net operating income. And their tenant's saving money on their utilities," Pelosi said. He said “breakthrough” is probably too strong of a term to use for his plan, but he sees it as a lucrative opportunity for the huge rental market. There’s a long way to go before it’s adopted widely. “There are really no incentives or clear structures on how to put solar on those rooftops, period," Pelosi said. Pelosi said the only barriers present in residential solar are cost and location, but with single-family rentals, “just by their very nature as rentals, there's just no economic incentive for the landlord to put solar on. And that's what we're trying to change."
The tenants who have already started to reap the benefits of Restore Solar’s initiative have told Pelosi they’re thrilled to be saving money on their power bills. And he knows landlords are always looking for ways to create incremental revenue streams. However, Pelosi recognizes that the economics of single-family rental solar are not compelling everywhere. The states where single-family rentals are booming would make the most sense to go solar—California, Arizona, Nevada, Florida, Georgia and North Carolina. If landlords will only be saving $20 a month on their utility bills, Pelosi understands they wouldn’t want to go through the process of installing solar on a single-family home. "But if I can save $50, $75, $100 a month, then those barriers make more sense to try and overcome,” Pelosi said.