Considering all of the benefits of solar for the environment and lowering utility bills, solar is thriving in the single-family home market. In California, 10.49% of single-family homes have solar. However, over 46% of California’s population rents, yet less than 1% of rentals have solar. This raises the question: What has prevented shared buildings from adopting solar?
The Major Problem: Split Incentive Complications
The split incentive issue comes into play with shared buildings because the property owner invests in the solar asset but gets few benefits. In fact, most multifamily property owners feel that understanding Virtual Net Metering (VNM) policies, distributing solar benefits to residents, and managing billing for solar is a logistical headache. Without a clear return on investment, property owners have little reason to invest in clean energy.
Lack of Understanding of New Policies
In the past, shared buildings could only use solar to offset common area electricity. This provided too little of a benefit for building owners to adopt solar. However, with the introduction of the Virtual Net Metering policy, multifamily solar can be shared with residents in addition to offsetting common area electricity. This opens up many possibilities for multifamily owners, as a shared solar system is a marketable amenity and can generate additional net operating income (NOI).
Challenges of Management, Equitable Allocation, and Liability Concerns
Even if multifamily owners understand the VNM policies and the opportunity it creates, they still face the obstacle of implementing and managing billing solar to their residents. Several multifamily properties opt for a flat discount system, but that doesn’t result in equitable sharing of the solar benefits. Trying to manage energy data sharing with utilities and an equitable benefit based on resident usage simply creates a pile of work that their property management teams don’t have time for.
The Solution: Easy Management and Clear ROI
Virtual Net Metering was a big step in enabling the adoption of solar for shared buildings in California, but it doesn’t solve the problem of multifamily solar management, billing, and a clear path to return on investment. That’s where Ivy’s Virtual Grid comes in. Our software makes it simple for shared buildings to adopt solar. Not only does it allow multifamily owners to benefit from solar savings, but also it guarantees savings for their residents. In doing so, property owners generate an average of $500 to $1200 per unit in new annual NOI. The software is complete with seamless rent ledger billing integration and a consumer-friendly monthly solar bill for residents. These features and more combined with the clear ROI eliminate all of the obstacles that prevent shared buildings from adopting solar. The impact of more shared buildings with solar will be felt far and wide as California is well-known for rate hikes and some of the highest electricity rates in the country. If you’d like to learn more about how Ivy can support your shared building’s adoption of solar, schedule a demo with us today.
Pioneering the Future of Multi-Tenant Solar Energy Management
2024 was a trailblazing year for Ivy Energy, where we shattered barriers, redefined possibilities, and delivered innovative solutions to address the multi-tenant solar split incentive challenge. By driving product advancements, forging impactful partnerships, and scaling operational processes, we empowered multi-tenant properties to embrace clean energy with confidence.
A Year of Growth and Market Expansion
Ivy has grown its active project pipeline 450% compared to 2023, with a line of sight to clear +600% in active projects by the end of the year. Our tech-enabled solutions empower more communities than ever. With $18M in Series A funding (Read more) and the strategic acquisition of Glow Energy (Read more), we are poised for unprecedented growth and impact. This investment enables us to enhance our technology, streamline operations, and expand our reach into new markets nationwide.
Entering new markets with increased resources allows us to address diverse energy challenges and deliver tailored solutions to property owners and tenants. Additionally, the launch of our consulting arm provides expert guidance for our clients and partners to save money and enhance ROI while navigating intricate solar investments.
Meaningful Operational Updates
At Ivy, innovation isn’t just about technology—it’s about creating digital tools that empower our clients and their tenants:
- PropTech Integrations: Partnered with RealPage, Entrata, and Yardi to automate rent roll syncing, move-in/move-out updates, and direct charge posting to resident ledgers. These integrations reduce monthly processing time by up to 2 hours per property while enhancing data accuracy and operational efficiency.
- NEM Credit Delay Optimization: The Utility Coordination team adopted the CPUC informal complaint process to reduce delays in NEM activation after PV solar system commissioning. This improvement cut the average resolution time for delayed NEM credits from 123 days in 2023 to 49 days in 2024, allowing property owners to see Net Operating Income over two months sooner on average.
Platform Advancements that Lead the Industry
Our engineering team broke new ground, ensuring our platform stays ahead of the curve:
- Migrated to a new infrastructure processing system for faster processing and further automation improvements across operational features.
- Introduced IvyDual in response to regulatory requirements in California, which allows us to enter new markets where consolidated billing is not viable.
- Achieved SOC 2 Compliance, reaffirming our commitment to data security. (Read more)
- Built initial public API for Conservice integration and new utility data access pathways, strengthening our platform’s versatility and reliability.
Empowering Positive Experiences with CX
At Ivy Energy, our customers rely on us as true partners in their clean energy journey, helping them achieve long-term NOI growth while providing exceptional support for property owners and tenants. We consistently deliver this experience by simplifying complex utility processes and offering our white-glove service that ensures our clients feel supported, informed, and empowered to succeed. This year, Ivy’s Customer Experience Team launched two significant platforms:
- Ivy Implementation Portal: A step-by-step, transparent portal that simplifies solar implementation for our clients and partners across multiple organizations. (Watch a walkthrough of the new portal here.)
- Resident Help Center: Educate tenants about the solar program with helpful resources and offer direct support online or by phone. (Explore the Help Center)
Shaping the Future Through Thought Leadership
In 2024, Ivy Energy reinforced its position as an industry leader; our Virtual Grid 3.0 impressed the judges and earned first place in Solar Power World’s “Best in Show” award for large-scale solar innovation. (Read more)
Leadership team members Alex Dogan, Tanya Kuhn, and Sean Nam were celebrated in San Diego Business Journal’s Leaders of Influence in Technology 2024 for their contributions to advancing sustainable energy. (Read more) Ivy was also featured in Alt Energy Magazine (Read more), San Diego Business Journal (Read more), and on Solar Academy. (Read more)
Logan Carter showcased Ivy’s groundbreaking innovations in a main stage speech at Cretech NY (Watch here), an engaging appearance on the IMN Podcast (Listen here), and a deep-dive interview with Chris Moreno, also known as “Mr. PropTech.” (Watch here) Ivy’s policy team further expanded its influence by authoring a Model VNEM Whitepaper, a critical guide to enabling multi-tenant solar models nationwide. (Read the Whitepaper).
Measurable Environmental Impact
This year, Ivy Energy amplified its environmental contributions, with contracted units in implementation set to offset an astounding 109 million pounds of CO2. Meanwhile, active units have already offset 9 million pounds of CO2, demonstrating our ongoing dedication to reducing carbon emissions.
Looking Ahead to 2025
As we celebrate 2024’s successes, we are always looking to the future. In 2025, we’ll continue to push boundaries, deliver innovations that empower our clients, improve tenant experiences, and lead the multi-tenant housing sector toward a sustainable future.
A Message from Dover Janis, CEO of Ivy Energy
“2024 was a year of progress and adaptation. While utility-caused delays challenged our growing pipeline, our focus on agile problem-solving reduced their impact and kept the market moving forward. This is a testament not only to the dedication and focus of our team but also to the strong macro-level foundation that the onsite energy business model provides for real estate owners, even in the face of monopoly-driven resistance. With a large and expanding customer base and hundreds of projects, we have continued to validate the transformative potential of clean energy solutions for shared communities. I’m incredibly proud of our team—now among the most mature, knowledgeable, and experienced in the industry—as we trail blaze the path forward. The market is primed to grow and drive transformative change in local communities. I’m deeply grateful to our partners and customers, whom we have the privilege of serving every day as we continue to lead the way.”
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