Australia’s 2 million rental properties are gaining access to cheap solar power under a new Digital Solar scheme which divides the savings between landlords and tenants.
Backed by Melbourne-based startup Matter, Digital Solar brokers deals between renters and their landlords which sees the property owner pay for the installation of solar panels and then sell electricity to the tenant at a cheaper rate than power from the grid.
The arrangement saves renters an average of $300 per year on their power bill, while making a $1500 annual profit for the landlord – with installation costs covered in four to six years. It’s an untapped market, with solar panels only on the roof of 1 per cent of Australian rental properties, says Matter co-founder Simon Barnes.
“The problem has always been that if you’re a tenant then you don’t want to pay to put solar on someone else’s roof, while if you’re a landlord you don’t want to pay for solar panels when you’re just giving the tenant free power,” Barnes says.
“It costs 8.5 cents per kilowatt hour to install rooftop solar, while in Australia your average grid electricity charge is about 24 cents.
“We exploit that difference so the tenant gets cheaper clean power, while the landlord recovers their expenses and gets a new income stream.”
The Digital Solar system monitors roof-top solar installations using tiny wireless smart meters designed to work with any electricity provider and any brand of solar equipment, including in-home batteries. The aim isn’t to make homes completely self-sufficient, only to reduce their reliance on the power grid.
Landlords pay a $9 per property, per month subscription fee to access Digital Solar, but there are no out-of-pocket expenses for the tenant – they only pay for the electricity they consume from the solar panels and the grid.
The landlord and tenant strike an agreement which lasts for the length of the rental agreement. Digital Solar recommends tenants receive a 20 per cent discount on the rate from the grid, with tenancy laws ensuring that landlords can not exploit renters by charging more than the grid rate. The system lets tenants monitor their power usage in real time, helping them better manage their energy usage.
Digital Solar is underpinned by Matter’s Hana platform, which analyses the specifics of each property to calculate the size of the solar system required, calculate savings and monitor performance.
The system is built upon Matter’s software already used by electricity and water providers in thousands of homes across the country. It is capable of handling complex tariffs including feed-in tariffs when power is sold back to the grid.
The Digital Solar smart monitors can be retro-fitted to existing solar power systems or installed with a new system. Digital Solar does not sell solar panels or inverters, but it can act as a broker to help customers find a good deal on a solar installation.
Later this year Matter plans to roll out a multi-tenant service to support apartment blocks, making solar power practical for another 400,000 dwellings across the country.
Digital Solar has signed up some of its first customers in Cairns, with tenants quick to jump at the offer, says Freeman’s Residential principal Arran Faithfull. Managing around 900 properties in Cairns, Faithfull says his clients see Digital Solar as a win/win situation – particularly tenants who’ve never had the option to make the most of solar power.
“We’re actually pitching it to the tenant first, asking them if they want to save some money on their power bill,” he says.
“Then we’re getting Matter to crunch the numbers as to whether there’s a business case on that property, then if it stacks up we present the business case to the owners.
“As a property owner it’s a pretty safe bet in terms of an investment, as long as the sun keeps shining you’re going to make money out of it.”