Navigating the Transition: Buyers Transferring Owned Solar Into Their Name
Are you considering buying a home powered by owned solar? It's an attractive prospect, but understanding how to transfer the solar into your name for warranty and other purposes can seem daunting. Also, are you aware of the potential issues associated with the true-up bill? This guide will help you navigate these intricacies, making the journey of acquiring a home with solar power seamless and beneficial.
Understanding True-Up: Balancing the Energy Ledger
Before we dive into the process of transferring solar ownership, it's essential to understand what a true-up bill is. In California's net metering program, your solar panels produce electricity, some of which you consume, and some of which goes back to the grid. You receive credits for this excess power.
During times when your panels aren't producing enough electricity (like at night or on cloudy days), you draw power from the grid. You may get a true-up bill after every 12 months your system is in operation because your utility company can’t track the total power your system produces during the day when your home is powered by the sun. Because of that, at the end of a 12-month period, your utility company sends you a true-up bill to reconcile the difference between the energy you used from the grid and the energy your solar system produced and fed back to the grid.
How the True-Up Bill is Calculated
You will want to track both your net metering and your electricity usage from the grid closely. If you use a lot more power than you supply, you’ll end up owing the utility company money when you get your true-up bill.
On your utility bill every month, you’ll see a section that provides your net metering statement. It will show you how much power your solar sent to the grid, and net consumption of power that your home used for that month. Keep in mind that you aren’t being billed for any net energy consumption shown in the net metering statement in that month’s bill. You get billed for that net usage in your true-up bill. You also get billed a monthly charge for being connected to the grid.
Keep track of your monthly net metering to keep track of your true-up bill
A smart way to manage your true-up bill is to keep a spreadsheet of your monthly net consumption and your monthly net metering credits. If you are on time-of-use billing, it is important to note when you send electricity to the grid (during the day) and to calculate its value based on the daytime rate for your plan. The same goes for any net energy usage. Note how much power was used and when it was used. Calculate the cost of that power based on the rate in your plan during the time of day (most likely in the evening) that the power was consumed.
Sample of net metering tracking worksheet (6 months shown)
|Energy charges or credits
In this hypothetical example, the home had higher net usage from Jan to Feb, resulting in a charge of $35.00 (remember, you weren’t billed for this). From March to June, the home had higher net metering, resulting in a credit of $39.00. Thus this home would be $4.00 ahead.
Plan to keep track of this information for a full 12 months. If you see that your total shows that you owe at the end of every month, you’ll need to be prepared to pay that total amount when your true-up bill arrives.
Transferring Owned Solar: How to Claim Your Power
Transferring ownership of a solar power system isn't simply a case of signing the deed to a new home. There are technical, legal, and financial considerations you need to navigate.
First, it's crucial to include the transfer of the solar panels in your purchase agreement. The current owner should provide all relevant documentation, including warranties, performance reports, and contracts with the solar panel installation company.
Once you've officially purchased the home, you should contact the solar installation company and the manufacturer to inform them of the change in ownership. This will ensure the transfer of the warranty, if applicable, and other benefits associated with the solar system. Make sure to clarify any responsibilities or conditions required to keep the warranty valid.
The True-Up Bill: Balancing Your Energy Books
Understanding the true-up bill concept is vital when buying a house with owned solar. The true-up bill is an annual statement from the utility company that reconciles the difference between the energy you've consumed from the grid and the energy your solar system produced.
Potential issues can arise if the house is sold before the true-up date, potentially leaving the new owner responsible for the entire annual bill. To avoid such pitfalls, ensure the responsibility for the true-up bill is included in the sales agreement.
Smoothing Out the Transition: Avoiding True-Up Pitfalls
You can protect yourself from unexpected true-up bills by being proactive. Here's how:
- Align the Closing Date: Try to align the closing date of the home sale with the true-up date, to ensure you are only responsible for your portion of the energy use.
- Consult a Professional: An attorney or professional with experience in solar energy transactions can help you understand the terms and conditions related to the true-up bill.
- Communicate with the Utility Company: Inform the utility company about the change in ownership. They can provide guidance on managing your account and the true-up process.
- Inspect the Solar System: Have a professional inspect the solar system. This will help you understand its condition, efficiency, and potential future maintenance or replacement costs.
Take Control of Your Solar-Powered Future
Transferring owned solar into your name as a new homeowner may seem complex, but with the right knowledge and resources, it's a hurdle you can easily overcome. By understanding the process and potential issues, especially around the true-up bill, you can confidently stride into a future powered by the sun. Remember, the journey to solar ownership is a rewarding one, filled with energy independence and significant cost savings over time.
Evaluating the Solar System: A Crucial Step
Before finalizing the purchase, it's advisable to have the solar system professionally inspected. This can provide insight into the panel's condition, efficiency, and anticipated future maintenance or replacement costs. The output and efficiency of solar panels can diminish over time due to various factors, including weather conditions and panel age. If they are nearing the end of their typical lifespan (around 25-30 years), you might soon face considerable replacement costs.
Final Thoughts: Harnessing the Power of the Sun
As you proceed with your plans to buy a home with owned solar, remember the importance of due diligence. Ensure the transfer of solar into your name is a part of the property's sale agreement and that you thoroughly understand the terms and conditions related to the true-up bill. Communicate with both the solar installation company and your utility provider to ensure a smooth transition.
As a new homeowner, you have the exciting opportunity to step into the future of sustainable energy. By mastering the ins and outs of transferring owned solar into your name, you can truly own your power, enjoy lower utility bills, contribute to a greener environment, and enjoy the many benefits of solar energy. You're not just buying a home – you're investing in a sustainable and cost-effective future.