NSW: Q&A Solar for Apartments – Power to the (Strata) People

We have received questions about installing solar for apartments from a few of our NSW lot owner and Committee Members.

Table of Contents:

• QUESTION: Are solar panels classed as scheme assets and covered by our strata building insurance?
• QUESTION: Can a strata member (52%) stop me from putting a rooftop solar water system on my roof (48%) due to the exterior appearance of the lot? The other strata property would not see the solar water system.
• QUESTION: The owners corporation has permitted us to install solar panels on the roof. The by-law holds us accountable for any future damage caused by the panels. Do we need insurance to safeguard us against potential claims?
• QUESTION: A lot owner has requested permission to install solar batteries on common property. Can we insist the batteries are installed within the lot?
• QUESTION: How and when is an embedded network a good solution for a strata property wanting to install a large solar PV system for the benefit of all owners?
• QUESTION: Can a NSW owners corporation have a bylaw stating they will never allow solar?
• QUESTION: The owners corporation passed a resolution to NOT cover solar panels installed on some villa’s roofs. I’m concerned about hail damage. Can I take out insurance?
• QUESTION: Would solar panels affect the building insurance? Solar panels are on one lot owner’s side of the roof.
• QUESTION: I want to install solar panels. Before I can install solar panels, I need to upgrade my fuse box. Isn’t it the responsibility of the owners corporation to pay for a fuse box upgrade?
• QUESTION: To install solar panels for an apartment, I believe I need to engage a lawyer to draft a new bylaw and the vote may not be successful anyway. Is there an easier way?
• QUESTION: We are looking into solar panels for apartments. As all roof areas are invariably common property and there are both good (solar efficient) and not so good areas on any roof structure, how does the strata committee go about defining where individual lot owners can position their solar PV panels?

Question: Are solar panels classed as scheme assets and covered by our strata building insurance?

In our small 3-lot strata, solar panels were installed on all lots over the past year. Can you please clarify the following:

1. Are solar installations classed as scheme assets, and should they be included in the asset register?
2. Does the scheme’s insurance cover solar panels?
3. Does our insurer need to be advised of any solar installations?

Answer: If the solar panels are permanent fixtures, they should be covered by the building’s insurance.

Q1: Are solar installations classed as scheme assets, and should they be included in the asset register?

Leanne Habib: If the solar panels are permanent fixtures, they should be covered by the building’s insurance. The by-laws applicable to the scheme will determine who is responsible for the ongoing repair and maintenance of solar panels. If the owners corporation installed the solar panels for everyone, it will usually retain responsibility for ongoing repair and maintenance. If individual owners install the panels, a by-law will usually confer the responsibility on the owner.

Q2: Does the scheme’s insurance cover solar panels?

Tyrone Shandiman: Yes. As they are permanent fixtures, solar panels are covered by the building section of a strata policy. If the solar panels are not permanently attached to the property, they are not covered by strata building insurance.

Leanne Habib: Generally speaking, yes, as they are generally deemed part of the building fixtures subject to the installation. However, you will need to check the policy terms and with the subject insurer.

Q3: Does our insurer need to be advised of any solar installations?

Tyrone Shandiman: It depends on your insurer. At present, we know of only one insurer that specifically inquires about solar panels when quoting. To ensure you’re covered, we recommend consulting with your insurer.

Leanne Habib: We recommend that the insurer is advised of any building improvements to ensure that such improvements are properly insured and covered.

Leanne Habib
Premium Strata
E: [email protected]
P: 02 9281 6440

Tyrone Shandiman
Strata Insurance Solutions
E: [email protected]
P: 1300 554 165

This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisenent Australia AFSL No 240549, ABN 15 003 886 687.

This post appears in Strata News #705

Question: Can a strata member (52%) stop me from putting a rooftop solar water system on my roof (48%) due to the exterior appearance of the lot? The other strata property would not see the solar water system.

Answer: Your neighbour could outvote your proposal.

To approve your installation, the owners corporation must pass a sustainability infrastructure resolution (i.e. less than 50% can vote against the resolution) via a by-law at a duly convened general meeting. So, yes, your neighbour could outvote your proposal. However, you may have recourse through NSW Civil & Administrative Tribunal that the owners corporation unreasonably refused your proposed installation. You would first require mediation. We recommend you seek legal advice should you pursue the matter at NCAT.

Leanne Habib
Premium Strata
E: [email protected]
P: 02 9281 6440

This post appears in Strata News #694

Question: The owners corporation has permitted us to install solar panels on the roof. The by-law holds us accountable for any future damage caused by the panels. Do we need insurance to safeguard us against potential claims?

We recently received approval to install solar panels on the roof. The by-law includes a condition that indemnifies the owners corporation for any future damage caused by the solar panels.

Does indemnifying the owners corporation mean there would need to be insurance? Do I need to take out insurance to protect me against future claims?

Answer: While the by-law indemnifies the owners corporation for future damage, it may not necessarily prevent the lot owner from making a claim on the strata insurance policy for the damage caused by the solar panels.

The lot owner’s contents or landlord’s insurance should ideally include coverage for third-party liability. An indemnity does not require an insurance policy in place, notwithstanding the owner may have recourse on their contents/landlords (public liability section) or the strata insurance (property cover) for damage to the building associated with the solar panels.

If the solar panels cause damage to the property, this insurance coverage can provide a potential avenue for addressing any related claims.

However, it’s important to note that the contents or landlord’s policy might contain exclusions for contractual liability.

Contractual liability exclusions typically apply when you agree to be liable for something solely due to an agreement or contract you have entered into. Therefore, it is crucial to review the policy’s exclusions to determine if any contractual liability exclusion may impact coverage.

It’s worth noting that while the by-law indemnifies the owners corporation for future damage, it may not necessarily prevent the lot owner from making a claim on the strata insurance policy for the damage caused by the solar panels.

As the owner is an insured party under the policy, and the policy covers the building, the owner has the right to file a claim for the damages under the strata policy.

Consequently, despite indemnifying the owners corporation for any damage caused, the lot owner may still have the option to seek compensation through the strata insurance policy.

Tyrone Shandiman
Strata Insurance Solutions
E: [email protected]
P: 1300 554 165

This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisenent Australia AFSL No 240549, ABN 15 003 886 687.

This post appears in the July 2023 edition of The NSW Strata Magazine.

Question: A lot owner has requested permission to install solar batteries on common property. Can we insist the batteries are installed within the lot?

A lot owner requested and has been granted permission to install solar panels on his roof. This owner has further requested permission to install a battery system either on common property or on the exterior of his lot, which we understand is also common property.

We are concerned about the installation and would prefer the batteries are installed within the lot. Is this a valid request?

Answer: The body corporate will need to consider the safety and security implications of the solar battery and the potential for damage to the common property.

The rules designed to guide the safe installation of residential battery storage systems are called the AS/NZ 5139 and should be used to determine the suitable location for installing battery storage.

Further, the rules regarding the installation of solar batteries on the exterior of a lot owner’s house or other parts of common property will depend on the strata scheme’s by-laws and regulations.

Generally speaking, lot owners need to seek approval from the body corporate before works can be carried out on common property. It is likely that the body corporate will need to consider the safety and security implications of the solar battery, as well as the potential for damage to the common property.

If the body corporate does not grant approval due to a safety concern, then the lot owner may need to consider additional cement sheeting or other non-combustible material where there is a habitable room on the other side of the installation.

Nigel Collins
Altogether Group
E: [email protected]

This post appears in the June 2023 edition of The NSW Strata Magazine.

Question: How and when is an embedded network a good solution for a strata property wanting to install a large solar PV system for the benefit of all owners?

Answer: You get the commercial benefit. It stays within the community.

The reason embedded networks are so important is that it gives you the flexibility to install this type of generation and retain the benefit. The benefit is lost at the point in time it connects to the grid. Embedded networks consolidate the grid connection to the point, and then everything internally is your own private network.

Having solar in an embedded network means that you can distribute that solar power within the embedded network without incurring any of the fees or charges we’ve talked about from the distributor. You can forego all of those kinds of impasse, which means you get the commercial benefit. It stays within the community.

The question then of whether or not that goes directly to the owners corporation or to the residence, electricity is a lot like water. It will flow wherever its first point of demand is, so it doesn’t really matter where you install it, it’s just going to go where it’s wanted.

The correct metering infrastructure will let you actually determine exactly where that power went, and then you can do some kind of financial or data administrative reconciliation behind the scenes. We do this quite often. We’ve got a large development underway in Northwest Sydney. It will have one of the largest solar arrays of any residential community in the southern hemisphere. All the solar power goes directly into the common areas and then just goes into wherever it needs to and then we work it all out financially behind the scenes.

I wouldn’t be too concerned about the infrastructure side, how it’s actually installed. If it’s within an embedded network and you have a provider that has the sophistication to do those calculations and to do the administration, then you can actually have the commercial benefit of that power delivered wherever you want it to be delivered.

Drew McKillican
Altogether Group
E: [email protected]

This post appears in the June 2022 edition of The NSW Strata Magazine.

Question: Can a NSW owners corporation have a bylaw stating they will never allow solar?

I know of a NSW strata scheme that had an agenda item put to its AGM to create a bylaw to “never allow roof top solar” installations.

We need better legislation, with greater focus on it being a right of owners to install solar when all things technical like roof type, orientations and fair allocations can be met.

Sustainable Infrastructure Initiative voting thresholds don’t go far enough to counter the objectors.

The owner in the owners corporation suggested to me, “how can I be EV ready and self generate from my own solar generated power” in a NSW strata building?

Answer: If an owner was to put up a by-law for roof top solar and it was refused by the owners corporation, the owner would have avenues through mediation and NCAT proceedings to seek an order that the owners corporation has unreasonable refused consent to the make of the by-law.

A by-law prohibiting the installation of roof top solar, in my view, would likely to be found as harsh, oppressive or unconscionable under section 139(1) of the Strata Schemes Management Act 2015. Furthermore, it is also likely to be found as an attempt to contract out of the Act in contravention of section 270 of the Strata Schemes Management Act 2015.

If an owner was to put up a by-law for roof top solar and it was refused by the owners corporation, the owner would have avenues through mediation and NCAT proceedings to seek an order that the owners corporation has unreasonable refused consent to the make of the by-law.

Matthew Jenkins
Bannermans Lawyers
E: [email protected]
P: 02 9929 0226

This post appears in Strata News #566.

Question: The owners corporation passed a resolution to NOT cover solar panels installed on some villa’s roofs. I’m concerned about hail damage. Can I take out insurance?

I’m buying a strata villa which has solar panels on the roof. There are 8 villas, and 2 have solar panels. Searches by my conveyancer show the owners corporation passed a resolution NOT to include cover for solar panels in its building insurance. I can’t take out building cover because I don’t own the whole structure. I’m concerned about hail damage in the future.

I can’t find an insurance company who will let me insure the solar panels under my contents policy. I’m happy to pay for cover. Have others faced this issue?

Answer: Solar panels being permanent fixtures are covered by strata insurance.

Solar panels being permanent fixtures are covered by strata insurance. Insurers do not impose requirements to pass a resolution in order for cover to be offered.

If the solar panels are not permanently attached to the property, they are not covered by strata building insurance.

The only consideration is whether the sum insured should be increased to factor in the panels, but most buildings do not increase sum insured after installation of solar panels.

Tyrone Shandiman
Strata Insurance Solutions
E: [email protected]
P: 07 3899 5129

This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisernet Australia AFSL No 240549, ABN 15 003 886 687.

This post appears in the December 2021 edition of The NSW Strata Magazine.

Question: Would solar panels affect the building insurance? Solar panels are on one lot owner’s side of the roof.

Answer: As solar panels are permanent fixtures, they are covered by the strata building insurance policy.

Solar panels being permanent fixtures are covered by the policy. If the solar panels are not permanently attached to the property, they are not covered by strata building insurance.

The only consideration is whether the sum insured should be increased to factor the panels in but most buildings do not increase the sum insured after installation of solar panels.

Tyrone Shandiman
Strata Insurance Solutions
E: [email protected]
P: 07 3899 5129

This information is of a general nature only and neither represents nor is intended to be personal advice on any particular matter. Shandit Pty Ltd T/as Strata Insurance Solutions strongly suggests that no person should act specifically on the basis of the information in this document, but should obtain appropriate professional advice based on their own personal circumstances. Shandit Pty Ltd T/As Strata Insurance Solutions is a Corporate Authorised Representative (No. 404246) of Insurance Advisernet Australia AFSL No 240549, ABN 15 003 886 687.

This post appears in Strata News #482.

Question: I want to install solar panels. Before I can install solar panels, I need to upgrade my fuse box. Isn’t it the responsibility of the owners corporation to pay for a fuse box upgrade?

I am in a strata complex of 20 units and would like to install solar panels. Before I can install solar panels, I need to upgrade my fuse box. The fuse box is attached to my unit and does not affect any other property or unit.

I have contacted the owners corporation and they state that, because the problem is only affecting my unit, I must pay for the upgrade. Is this correct or is it the responsibility of the owners corporation to pay for the fuse box upgrade?

Answer: It would appear then that the fuse box is your private property and because your proposed works necessitate an upgrade to the existing features of your unit, you will need to upgrade the fuse box to facilitate your works.

Leanne Habib
Premium Strata
E: [email protected]
P: 02 9281 6440

This post appears in Strata News #467.

Question: To install solar panels for an apartment, I believe I need to engage a lawyer to draft a new bylaw and the vote may not be successful anyway. Is there an easier way?

I live in a complex of 8 villas and share a common wall with 1 of the villas.

I have been told there is a by-law that states the maximum number of solar panels permitted for each property is 3 panels. Everyone has 3 panels for their hot water.

I want to install solar with 20 panels for my apartment. I was told I would have to engage a lawyer to draft a new by-law which would be put to the committee. If I couldn’t get 75% in favour then the vote would fail. The money paid to the lawyer for the bylaw would be wasted. Is there an easier way to do this?

Answer: There is no requirement that a lawyer draft a by-law, however, it is recommended.

The first thing to note is that a by-law requires a special resolution, which requires that no more than 25% of owners present and entitled to vote, cast a vote against the motion. A slight technicality, but on occasion, this can make a difference.

There is no requirement that a lawyer draft a by-law. However, as it is a binding commitment, it is recommended. In this case, your by-law and resolutions will need to cover off on several sections of the Strata Schemes Management Act 2015, including s108 (making changes to the common property) and Division 3 (By-laws conferring right or privileges over the common property). As there is an existing by-law, consideration on how to deal with that will also be required. It’s more complicated than it may seem on the service.

If you do decide to put a by-law forward to a meeting for consideration and it is not passed, you can seek relief from NCAT, by seeking orders that the by-law be made on the grounds that the refusal was unreasonable. You’ll find details on this in s149 of the SSMA.

Natalie Fitzgerald
More Than Strata
E: [email protected]
P: 1300 044 979

This post appears in Strata News #341.

Question: We are looking into solar panels for apartments. As all roof areas are invariably common property and there are both good (solar efficient) and not so good areas on any roof structure, how does the strata committee go about defining where individual lot owners can position their solar PV panels?

There have been a number of incentive programs to encourage owners corporations as well as individual lot holders to take advantage of solar for apartments. As all roof areas are invariably common property and there are both good (solar efficient) and not so good areas on any roof structure, how does the strata committee go about defining where individual lot owners can position their solar PV panels?

Our townhouse complex has sufficient roof space to accommodate solar panels for any lot owner wishing to take advantage of solar for apartments. There are however significant variations in the roof’s solar collection effectiveness. This will mandate far more costly solar panel installation for the less solar efficient areas.

Not all owners’ PV arrays can be accommodated on the optimum roof areas. So what guidelines can be applied to logically (and equitably) assign any common property roof area to any one owner for their solar collection panels?

Is it reasonable to allocate the premium collection site to PV panels collecting electricity for the strata, requiring lot owners to accept a lesser power option for their personal electrical needs?

Here are some resources which may assist with your research into Solar for Strata Apartments:

• Raising the roof: Solar for renters and apartment dwellers
• Get in on the ground floor: how apartments can join the solar boom
• More of us are living in apartments. Where does that leave rooftop solar?
• Sustainability Infrastructure Amendment to the NSW Strata Schemes Management Act and Solar Panels with Case Study

We are looking for information from our community on this topic. Have you installed solar panels in your building? What is working / not working? Do you have a solution to dividing up the roof space equally? Are you researching the topic of solar panels in your building? Please comment below.

This post appears in Strata News #219.

Have a question or something to add to the article? Leave a comment below.

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• NSW: Power2U – Discounts on Solar Systems and LED Upgrades

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