Around half of Yarra residents rent the home they live in and most don't have the benefit of accessing electricity from rooftop solar. A typical rental property doesn't have rooftop solar because there is less of a financial incentive for landlords to pay for the upfront cost of a solar system when the tenant benefits from power bill savings.
In addition, tenants may not stay at the same property for the full 3-5 years of the solar payback period, leaving little incentive for tenants to seek landlord permission to install solar at their own cost.
There are now options available to help tenants and landlords share the costs and benefits of solar.
What are the options?
Solar rebates for rental properties
The state government’s Solar Victoria program offers rebates for solar on rental properties up to $1,850, and no-interest loans up to the value of the rebate. Eligibility criteria for tenants are similar to the solar rebates available to homeowners. The landlord pays the remaining cost of the solar system, and the landlord and tenant sign an agreement. The tenant uses the electricity generated and receives the feed-in-tariff for any excess electricity. Tenants and landlords can enter into an agreement where the tenant contributes a percentage of the cost of loan repayments.
The Solar Victoria rebate for rental properties allows landlords to improve their property values, reduce the environmental impact of their investment property, and potentially attract or retain tenants, who will benefit from bill savings. Landlords should ensure they have confirmation of eligibility for a rebate before signing a contract or paying a deposit for a quote.
For more information visit Solar Victoria rebates for rental properties.
There is a special stream of Solar Victoria rebates reserved for community housing providers. If you live in community housing, talk to your housing provider about accessing the Solar Victoria rebates for community housing providers.
Other ways to share the benefits
For rental properties that are not eligible for, or choose not to apply for, Solar Victoria rebates, another option is for both the landlord and tenant to equitably contribute to the cost of the solar system.
A solar benefits calculator can help to determine a fair rental increase to correlate with the energy savings tenants will see from the solar system. The tool calculates the estimated bill savings for the tenant based on the solar system size and energy usage, and then calculates a suggested repayment agreement that is less than the bill savings. From day one, the tenant is saving on energy bills, but is also making a contribution toward the cost of the solar system.
There are rules governing how often and for what reasons rent can increase, and these may affect repayment agreements between landlords and tenants. These rules are specified in the Residential Tenancies Act. When negotiating any changes to rent or landlord-tenant agreements outside of the Victorian government’s Solar Victoria scheme, make sure they comply with regulations, and seek independent advice as needed. Tenants Victoria provides information and advice to renters, and Consumer Affairs Victoria has more information about renting and associated regulations.
Buying renewable energy (GreenPower)
You can choose renewable energy through your retailer, and while it doesn’t put solar on your roof, you don’t need anyone’s permission. When you choose 100% GreenPower from your electricity company, every megawatt hour (MWh) of electricity that you use is matched by a MWh of renewable energy supplied to the Victorian electricity network.
Find out more about buying certified GreenPower.
New and emerging options
There are a number of new ways to buy renewable energy that are just starting to become available. Solar gardens and other ‘offsite solar’ solutions, software platforms offering energy trading and sharing, and investing in community energy projects are some options that offer promising solutions to renters. Many of these solutions are now in trial or pilot phases, or limited in availability, but may become more widely available as the technology advances and regulations change.
Talking to your landlord
Talk to your landlord about the environmental and financial benefits of solar. Are they aware of the Solar Victoria rebate for rental properties? Would you be willing to contribute an amount less than your bill savings toward the cost of a solar system? Write to them and let them know.
Guides such as Renew’s Renters’ Guide to Living Sustainably have information for renters on making your rental home more comfortable and energy efficient, saving money on energy bills, and talking to your landlord about making improvements, including going solar.
Case study: Energy freedom for a landlord and tenants
Amaryll, a landlord in Clifton Hill, is helping her tenants save by installing solar on her rental property, while helping support the local renewable industry. Read more here.