Australia leads the world in rooftop solar. About one-third of all Australian houses have rooftop solar installed and recently there has been a surge in demand for home batteries, so solar power can be stored and later used or sold. Yet some home-owners can’t afford or simply don’t want a solar system, others live in apartments – which complicates matters, and many others rent houses or apartments from owners who have little incentive to install solar. The elderly are often reluctant to install solar systems, wary of the technology and unsure whether they will see a useful return within a reasonable period of time.
Energy companies have devised various offerings to try and cover the spectrum, says energy company Amber’s co-CEO Dan Adams. Amber provides the software to automate home batteries and electric vehicles so they charge when there’s cheap renewable power in the grid and discharge when the grid needs power, maximising the owners’ financial return.
The various energy options now on offer to consumers include financing for solar systems, offered by energy companies such as Brighte and Plenti; a solar and battery subscription model now offered by hardware giant Bunnings in partnership with Zelora and Intellihub, so consumers don’t have to pay anything up-front; and finally the power purchase agreement (PPA), which has proved popular in the US but has yet to take hold in Australia.
With this PPA model, the supplier installs the solar system and the battery and usually provides on-going maintenance, and the property-owner agrees to pay for the output of the system on a fixed rate and for a fixed contract term.
“It hasn’t been that common in Australia,” Adams says. “There may well be people that are offering it, but it’s definitely not a significant share of the residential market.”
Meanwhile, many Australians own and live in apartment buildings so they don’t own their own rooftops, but now there are solar systems which allow apartment-owners to take advantage of solar power.
According to Melbourne-based firm Allume Energy, about two million Australians live in low-rise and medium-rise apartment buildings, so Allume offers solar system roof installations with technology that allows participating apartment residents to share the resulting solar power.
Meanwhile, about 30 per cent of Australian dwellings are rented rather than owned, according to census data from the Australian Bureau of Statistics, and renters are rarely able to take part in the solar power market. Providing solar-systems to rented properties has so far proved difficult, Adams says. Landlords have a much lower incentive to pay for solar systems, because the tenants get the cheaper power and there’s no real monetary benefit for the owners.
“There are a number of people who have tried to solve that problem by putting together models where the renter pays for the value from the solar system: it could be a PPA-type model, and that revenue then goes back to the landlord,” Adams says. “They haven’t been that successful,” he adds. “I’m not aware of anyone doing it at any real scale.”
With the imminent advent of vehicle-to-grid (V2G) technology in Australia, renters could feasibly use their electric vehicles to power their homes, Adams points out. When these renters moved away from the property, they would have to move the V2G charger, but even so, that would be cheaper than moving a home battery.
Australian companies are now looking further afield to offer solar energy systems to people who have yet to engage with solar power, says Ty Christopher, director of Wollongong University’s Energy Futures Network.
“We’re seeing everyone starting to clamber in for a niche in this space,” he says. “As we start to reach more of a saturation point of owned homes that have solar on them, people will look for more innovative ways to continue the renewables journey and make some money out of it.”
Christopher expects larger solar installers and community collectives to come up with different models that will encompass forms of roof leasing, particularly for commercial properties.
“The real challenge that we face is there’s a lot of very large roofs in the industrial space that are going unattended in terms of solar and the fundamental commercial property ownership model places a division between incentive and benefit when it comes to solar installation,” he says.
“In most cases, it’s a landlord situation where a company owns the property and leases it to the company that’s conducting business under the roof.”
Leasing the roof to a solar energy company provides a dividend to the property-owner and also potentially provides cheaper solar energy to the commercial tenant, Christopher adds.
“One of the things that we’re starting to see come into the market now,” he says, “and I think for the ultimate good, are products or companies that want to lease that roof space from the property owner, and therefore give the property-owner another financial return on the property.”