/
Developer revenue
Increase Revenue and Improve the Tenant Proposition With Solar.
Tenants are increasingly looking for buildings that provide protection from rising energy costs, and assist them in achieving their corporate ESG goals. Solar can help meet these needs, while increasing a commercial landlord’s net income.
Whether solar works for your site depends on your building and commercial arrangements. We’ve put together the below information to help you assess if solar and battery is the right fit for your property
/ The Opportunity
A Win For Both Tenants and Landlords.
Installing solar and batteries can be an attractive commercial proposition for both both tenants and landlords. Solar can configured to reduce tenant electricity costs, or reduce common area costs, which may also benefit tenants. There are a number of commercial arrangements including Power Purchase Agreements (PPAs), that allow landlord investments in solar to be recovered fairly from tenants, while providing an attractive return on the capital invested. Solar assist with gaining Green Star ratings, and improve a building’s NABERS rating. A solar system designed into a building becomes part of the asset itself. It influences how tenants value the space, how buyers assess the asset, and how the building is managed over its full lifecycle.
An IRR of 7-15% is typical. Investment in commercial solar for landlords can be an attractive investment.
/ Is it right for your building?
Clearly Understand The Opportunity, and Design for Your Situation.
Solar and battery integration works on most new commercial developments. The question isn't whether it works technically, but which model best aligns with your development’s commercial objectives.
In addition to the points covered in the reduce energy bills solution (Energy profile fit, building suitability, optimal sizing), there are three other important points to consider.
Will Your Tenants Pay a Premium For Lower Energy Costs or Green Credentials?
Commercial tenants with ESG reporting requirements or a focus on long-term operating costs - are creating clear demand for integrated energy solutions. If your market values sustainability or cost reduction, solar integration is a competitive differentiator. A development that generates its own power and has the credentials to prove it is a compelling product in the market.
How will your recover your investment?
It is important to consider the commercial arrangement with your tenants, and consider how the investment in solar can be recovered. This is often through 1 or 3 approaches. The right approach will depend on your situation.
- Green lease premium.
- On sell the electricity to your tenants.
- Reduce your operating costs.
Are you targeting a Green Star rating or NABERS?
Solar could gain up to 4 Green Star credits depending on the tool being used for your building, or improve your NABERS rating. The requirements of NABERS and the relevant Green Star tool need to be understood and the solar system designed accordingly.
/ How We Help
Feasibility Assessment
We assess the buildings suitability for solar, model the revenue scenarios for different system configurations and ownership models, and recommend the optimal approach for your development's commercial objectives. This provides you with a clear understanding of what can be achieved, the expected cashflow, and return on investment.
Solution Design
We design an integrated solution that works within the constraints of the building, to achieve the desired commercial outcomes. This includes both structural & electrical. For new buildings we will coordinated as part of the building design team.
We manage procurement and quality
Revolve specifies the equipment, assists with the tender process, and oversees quality through construction and commissioning. Because we don't install systems ourselves, we can hold the installer to account on your behalf. You'll have one point of contact.
Handover and ongoing revenue
Solar isn't set and forget. We can manage your solar assets to ensure you realise the expected return. This can include performance and reporting, fault detection, and scheduling of preventative O&M.
/ FAQ
Questions about integrating solar into your development?
What does it cost to integrate solar into a development?
The cost depends on system size, and complexity of integration with the building. The more relevant number is the return -: revenue from energy sales, tenant attraction, sale price premium, green rating credits. Revolve will model the system providing estimates CAPEX, OPEX and the return on investment these before you commit.
Who owns the solar system after completion?
That depends on the revenue model. The developer can retain ownership and sell energy to tenants metering arrangement. A third party can own and operate it under a PPA or lease arrangement. Each model has different financial and legal implications. Revolve helps you choose the structure that fits your development's commercial objectives and tenure structure.
How do Power Purchase Agreement (PPA) work?
A Power Purchase Agreement (PPA) is a contract between a party that funds, owns, and operates a solar system, and the customer who buys the electricity it generates at an agreed price over a set term. A landlord could own the system and offer a PPA to its tenants, or could engage with a specialist PPA provide who will install a system on the building and sell the power to the landlord or tenant. PPAs offer a means to benefit from solar with little or no upfront capital, typically paying a rate that’s competitive with grid electricity and often indexed over time. The key terms are the price structure, contract length, who gets the environmental/renewable claims, and what happens if the building is sold or a tenant changes.
For a new development, when in the design process should we engage?
As early as possible. The ideal time is concept or scheme design, before structural and roof decisions are locked. But even at detailed design or post-consent, there are still integration opportunities. The later you engage, the more constrained the options and the higher the cost. For future stages and projects, engaging at masterplan saves money and delivers better outcomes.
What are the typical considerations for an existing building?
For an existing building it is important validate the suitability of the building. The main areas that need to be checked are the structure of the roof, age of the roof cladding and when this is expected to be replaced, shading of the roof, and the electrical configuration and capacity of the building.
