SOLAR ENERGY SYSTEMS and Davis Sterling

SOLAR ENERGY SYSTEMS
California promotes the use of solar energy systems. Accordingly, associations cannot (i) prohibit solar energy systems, (ii) impose restrictions that significantly increase their cost, or (iii) impose restrictions that significantly decrease their efficiency. (Civ. Code §714.)

20/20 Rule. For solar water heating systems, associations cannot impose requirements that will decrease efficiency or increase installation costs by more than 20%.

20/2000 Rule. For solar energy systems, associations cannot impose requirements that will decrease efficiency by more than 20% or increase installation costs by more than $2,000. As provided for in Civil Code §714.1, associations may impose reasonable provisions that restrict the installation of solar energy systems installed in common areas. “Reasonable” restrictions are those where solar units were comparable in performance and cost to unapproved type of unit homeowner sought to install on the roof of his home. Palos Verdes Homeowners Association v. Rodman (1986) 182 Cal.App.3d 324

Common Area Installations. At this point, it is unclear whether owners have the right to install solar systems in the common areas. It appears that the stronger argument is that they do not. Members do not control the common areas; all such control is through an elected board of directors. Moreover, any installation in the common areas would result in an exclusive use easement which, per Civil Code §1363.07, requires approval by 2/3rds of the membership.

Exclusive Use Roofs. Townhouse owners with exclusive use common area roofs have a better argument that they have a right to install solar panels on their roofs. However, if the association is obligated to maintain those roofs, it raises significant issues related to the increased cost of maintenance and whether those costs can be billed to the owners who install solar panels.

Architectural Review. 
If an application is not denied in writing within 60 days from the date of receipt of the application, the application shall be deemed approved, unless that delay is the result of a reasonable request for additional information. If approvals are willfully avoided or delayed, an association can be penalized up to $1,000. (Civ. Code §714(f).) Aesthetics are a proper part of the architectural review process, provided it does not significantly increase the cost of the installation. (Tesoro del Valle v. Griffen.)

RECOMMENDATION: Associations should adopt written architectural standards in consultation with legal counsel regarding the installation of solar energy systems.