Geoffrey T. Klise, Jamie L. Johnson, Sandra K. Adomatis
As PV installations increase across the U.S.,
there will be a point when an appraiser will have the opportunity
to value the PV system as part of a property sale or re-finance.
Proper valuation techniques as applied to solar PV are necessary
to reflect the increase in market demand for solar PV systems.
Appraisers must follow the Uniform Standards of Professional
Appraisal Practices (USPAP) when valuing solar PV systems,
which means that appraisers must gain competency to 1)
accurately recognize the value proposition of a PV system, and 2)
develop the PV system’s market value as it contributes to the
property. The challenges currently faced by property owners
with installed PV are whether the PV system adds market value
to the property, and finding an appraiser with competency. Not
all markets are the same, and PV market values will vary
considerably based on many factors that include, but are not
limited to the adoption rate in the particular market, the utility
rate paid by the customer, the PV system’s condition, aesthetics,
and obsolescence. This paper will discuss how past challenges
with respect to proper PV system valuation are being addressed
in a standard fashion, along with the far-reaching benefits that
may be available to future PV adopters as valuation concepts are
ultimately recognized and adopted by valuation professionals,
real estate agents, mortgage lenders and underwriters.