How Installing Solar Panels on Multifams Can Earn More GRI

[Sven Salvador]

A whopping 33% of the U.S. population lives in a rented apartment, and these apartments are power guzzlers. We can reduce their power bill by 2/3 with Green Retrofits and solar panels.

First, We Reduce the Utility Bill

We replace the house water heater with a solar water heater, add insulation, seal air leaks, add LED lighting, and replace the old appliances with Energy Star Rated appliances

We Then Add Solar Panels

The levelized cost of solar is now less expensive than the price of electricity. This savings, combined with preferential green financing, increases your profit spread.

You can spend some of the savings on lush landscaping and free wi-fi for all tenants, upscaling your building.

10 UNIT EXAMPLE: Purchase a 10 unit building for $1,800,000 with a 25% down payment, ($450,000). Add an additoonal $70,000 into the loan for energy efficiency retrofits and solar panels. You will have reduced the utility bill by 2/3. You then increase the rents to reflect the tenant’s utility bill expense plus their Wi Fi payment, and keep the spread as profit.

Facts and formulas: According to the U.S. Energy Information Administration, Californians consume an average of 562 kilowatt hours per month. They pay an average of 16.25 cents per kilowatt hour, and have a monthly bill of $104.00. Add a $39.00 Wi Fi bill = $143.00 total monthly utility bill x 12 months x 10 units = $17,000. Add $5,000 for water heating and house lighting = $22,000 annual utility cost. We have reduced this to $4,500 per year thru our retrofits, or by about 2/3.

The green retrofit reduced the electric bill by 40%, (per Build It Green California), from $22,000 to $13,200, Expressed in kWh: 562 watts Less 40% = 337 kWh x 10 units = 3,337 kWh per month X 12 months = 40,000 kWh per year.)

Solar Panels power formula: 40,000 kWh / 1.50 solar production ratio = 26,665 kWh / 300 watt panels =88 panels. @ $600 installed each = $52,800 in solar panels

COST OF RETROFIT:

$52,800 = 88 solar panels.

$10,000 new solar water heater

$ 7,200 insulation, led lights, caulking and repairs

$70,000 @ 5% for 30 years = $375 per month

This information is from TheGreenRetroFit.com