Valuation Resources for Appraisers

The most recent selling guide by Fannie Mae was released on December 16, 2014. Section B2-3-04, "Special Property Eligibility Considerations" now has guidance on eligibility for properties with solar PV that are either owned or lease by the homeowner.
HUD released these guidelines within the Single Family Housing Policy Handbook on September 20, 2014 with an effective date of June 15, 2015. There is a section that discusses a new loan product for solar PV. This product can only be used for purchasing a PV system as part of a property transaction and cannot be used to pay for a solar lease product.
A draft of these requirements was released on July 31, 2014, with the most current draft version showing a date of August 27, 2014. There are many areas of interest to appraisers in here, including a distinction on how owned and leased PV systems are to be evaluated, the impacts of shading on a PV system, and a discussion on the different approaches that can be used to measure and report contributions to value.
These resources are available from the Appraisal Institute and include classroom education, webinars, forms and reference material for training appraisers on how to both recognize the unique aspects of solar PV, and explain methods that can be used by appraisers to develop the value of the PV system.
PV Value® was created by Energy Sense Finance to utilize income, cost and sales comparison approaches to develop the market and fair market value of a solar PV system. The application is web-based and can be used on desktop and mobile computing devices. The tool is currently in a beta version, and can be accessed after creating a user account. New features will be added to allow for the use of the cost and sales comparison approaches. The tool currently utilizes and income approach that can be used to develop the value. The proof-of-concept spreadsheet version that served as a precursor to this web tool was jointly developed by Sandia National Laboratories and Energy Sense Finance. The section below describes that collaborative effort in more detail.
The information shown here is available on the Sandia Labs PV Value® site , which housed the proof-of-concept spreadsheet from December, 2011 to August, 2014. Journal articles, papers and webinars discussing appraisal practices and PV Value® research can be found on this page.
  • PV Value® User Manual — This was the original user manual for the proof-of-concept spreadsheet version. Information is provided on the rationale behind each parameter. It is no longer being updated as the spreadsheet has been depreciated.
  • Valuation of Solar PV Systems Using a Discounted Cash Flow Approach — This peer reviewed journal article was published in the Fall 2013 issue of the Appraisal Journal and outlines the case for how to apply appraisal techniques to solar PV systems. Click here to access the Sandia webpage, then scroll down to the Publications and White Papers section to download the document.
  • Market Valuation Perspectives for Photovoltaic Systems paper — This paper presents results of a survey of PV Value® proof-of-concept spreadsheet users to better understand how they were using the tool in the marketplace.
  • How PV System Ownership Can Impact the Market Value of Residential Homes paper — This paper looks at three primary ownership options (customer, third-party, PACE) and discusses the appraisal perspective.
  • Standardizing Appraisals for PV Installations conference paper — This paper was presented at the 39th IEEE PVSC conference in Tampa, Florida on June 21, 2013 and discusses the importance of using proper valuation techniques to capture the value of solar PV systems.
  • Interstate Renewable Energy Council webinar — This webinar was broadcast just after the rollout of the original proof-of-concept spreadsheet to explain the PV Value® tool and importance of properly valuing PV systems.
Lawrence Berkeley National Laboratory (LBNL) has been conducting research on the premium received by residential homeowners when a PV system is sold as part of a real estate transaction. This research originally covered California systems, and has expanded into other states. The research to date only covers PV systems owned by the homeowner and not third-party owned PV systems.
To date, there are only two publically available studies, though there may be more in the future.
In some jurisdictions, permanent documentation is required for safety purposes, to let a utility worker or emergency response personnel aware there is a photovoltaic system on the property. The benefit of this documentation is that it may outlive paper or digital documentation that may not always pass from one property owner to the next. Examples of Permanent Labeling and documentation
Documentation is available for builders on what types of planning and construction methods to consider when building a solar ready home.This information can be useful for valuation professionals by pointing out specific features to look for when valuing the property.
The information presented here comprises of databases collected by many public and private entities. Some are driven by incentives offered, where PV system data is collected as part of the incentive application. Others have some free viewing features, but require a login to see more detail or to download the data in other formats. The level of information available varies from each site, with some providing general installation detail, and others providing performance information.
  • Open PV- The National Renewable Energy Laboratory has a database of installed PV systems by zip code. Many of these PV systems are provided to NREL by state incentive programs, installers, utilities and individuals. Information can be sorted by zip code, pre-incentive (gross) cost and installation date.
  • PVOutput- This site collects and displays solar PV information across the world. A solar PV system owner gives PVOutput permission to gather data from their own PV monitoring system to allow for comparing production data in a regional setting, or across different components.
  • California Solar Statistics- This site has all of the California Solar Initiative (CSI) and California Public Utilitys Commission (CPUC) data on installed PV systems. Spreadsheet data on PV systems installed under the state incentive programs can be downloaded. Information includes a great deal of information on cost, ownership, and installation detail that can be found here.
  • NYSERDA PV Incentive Program - The New York State Energy Research and Development Authority (NYSERDA) displays PV incentive program data, including location (by city) PV system size, costs (gross and incentive), module and inverter manufacturer, incentive amounts, and whether the PV systems are customer or third-party owned. Chart, table and map views can be generated in the web browser with this data.
  • Massachusetts Clean Energy Center- Their incentive program data includes a spreadsheet on installed PV systems through their Commonwealth Solar incentive program. Information includes building type, city, ownership, system size, installation costs, and rebate approved.
  • SEIA Major Solar Projects- This map shows the status of large-scale solar PV systems across the U.S. that are operating, under construction and under development.
  • Campus Solar Photovoltaic Installations Database- This site provides location and detail on solar PV systems installed on college and high school campuses across the U.S. Information provided includes cost, size, production estimates, installation type, and module and inverter manufacturer.
  • Enphase- This company develops inverters and maintains a public-facing website of solar PV installations utilizing their microinverter technology. Some sites in this interface will show actual production over the lifetime of the PV system, multiple tilt and azimuth configurations, array layout, module manufacturer, and the company that installed the PV system and /or provides the monitoring service.
  • SMA America- This company develops inverters. Their public-facing website of solar PV installations may include detail on the PV system name and address, the PV system’s size, site photo, date commissioned (operational), inverter specifications, energy production and specific yield, and performance ratio.
  • Solectria Renewables- This company develops inverters. Their public-facing website of solar PV installations is available if the PV system uses a Solectria inverter and the site name or installer name is known.
This section provides links to a number of reports that have looked at past prices paid and ultimate gross and net costs of PV systems from a number of different research institutions. This information can provide appraisers with historic market support information in specific cities and states across the U.S. These studies are different than the system-specific costs associated with rebates as shown in the links for California, Massachusetts, and New York incentive programs and the OpenEI database.
  • LBNL Tracking the Sun- This report series looks at the installed price (paid to developers or installers before incentives) of photovoltaics starting in 1998. The report is published annually and is in its 7th year with data available up to 2013. Prior versions of this report can be found by searching the Energy Markets and Policy Group publications website.
  • SEIA / GTM Solar Market Insight- This report series is done quarterly to break out costs by market and location. Summary data is available for free. More specific information by state and market is available to purchase.
  • The Interstate Renewable Energy Council(IREC) prepares an annual U.S. Solar Market Trendsreport that outlines different market forces shaping the adoption of PV in states across the U.S. PV pricing is included in these reports, and archived reports back to 2008 can also be downloaded.
Understanding what incentives are available at the national, state and local level can help better understand the market maturity for solar PV as well as changes where new incentives are being brought in, or old incentives are being phased out. Where solar is more widespread, incentives are slowly disappearing. However in new markets, solar incentives are relatively new and are intended to grow that market.
  • Database of State Incentives for Renewables & Efficiency(DSIRE) - This website and associated database of incentive information houses the most up-to-date information on incentives associated with solar PV. It provides information on federal, state, local and utility incentives.
There are many independent laboratories that test PV modules for specific customers to ensure they meet design criteria. However, there is not much information available to the public from that testing. Also, long-term durability information is not readily available as many manufacturers are no longer in business and new manufacturers are entering the marketplace.There are however some sites that rank specific modules based on initial quality.
  • EnergySage - Selecting Solar Panels- This site places a classification on many of the major manufacturers of solar modules, starting with Premium, then Standard, down to Economy. More detail from EnergySage is available on the parameters published on the modules and how to evaluatethose from a quality and durability perspective.
  • Fraunhofer PV Durability Initiative- This testing group founded in Germany, recently released a paper on scoring for five different solar manufacturers from accelerated life testing and long-term field exposure data.