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.)
Solar Water Heating. For solar water heating systems, associations cannot impose requirements that will increase by an amount exceeding 10 percent (10%) of the cost of the system, but in no case more than one thousand dollars ($1,000), or decreasing the efficiency of the solar energy system by an amount exceeding 10 percent (10%), as originally specified and proposed. (Civ. Code § 714(d)(1)(A).)
Solar Energy Systems. For solar energy systems, associations cannot impose requirements that will decrease efficiency by more than 10% or increase system costs by more than $1,000 from those as originally specified and proposed. (Civ. Code § 714(d)(1)(B).) 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 v. Rodman.)
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.
Common Area Roofs & Carports. Members have the right to install solar energy panels on a common area roof of the building in which the owner resides, or a garage or carport adjacent to the building that has been assigned to the owner for exclusive use. Per Civil Code § 714.1 and § 4746, the following guidelines apply:
- the system must meet applicable building codes;
- the system must receive the association's approval (which cannot be unreasonably withheld);
- the association may include provisions for the maintenance, repair, or replacement of roofs or other building components;
- the association may require installers indemnify the association and pay for any damage;
- the association may require a site survey showing placement of the panels and equitable allocation of usable area among owners sharing the same roof, garage, or carport;
- applicants must notify each owner of a unit in the building on which the installation will be located of the application to install a solar energy system;
- the owner and each successive owner must maintain a homeowner liability coverage policy at all times and provide the association with the corresponding certificate of insurance within 14 days of approval of the application and annually thereafter;
- disclose to prospective buyers the existence of the solar energy system and their responsibilities to maintain and pay any damage to the common areas.
Architectural Review. If an application is not denied in writing within 45 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 v. Griffen.)
Recommendation: Whenever a solar energy system is installed by an owner on a common area roof (or anywhere in the common areas), a covenant should be prepared by legal counsel for signature by the owner and recordation with the County Recorder obligating the owner (and all future owners) to properly maintain the system, repair any damage to the common areas related to or arising from the owner's solar energy system, and indemnifying the association in the event it is sued because of the solar energy system.
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