Landlords turn to rooftop solar to yield income

Rising electricity prices and growing tenant demand for cost certainty are accelerating uptake of rooftop solar and battery storage across offices, warehouses, shopping centres and multi-tenant residential developments. Rather than treating energy as a fixed operating cost, building owners are beginning to monetise onsite generation, supplying electricity to tenants and, in some cases, exporting excess to the grid.

According to Jack Kapoor, Founder and Managing Director of Agile Energy, this ‘energy-as-a-service’ model is gaining traction as property owners search for new yield in a high-interest-rate environment.

“For decades, landlords relied almost entirely on rent to generate returns,” Kapoor said.

“Now buildings can generate income in two ways, from tenants paying rent and from the energy the building produces.”

Large underutilised rooftop areas, particularly on commercial and industrial assets, are central to this shift. Installing solar systems allows landlords to supply electricity directly to occupants, often at a price below retail tariffs while maintaining a margin.

“Tenants receive cheaper and cleaner electricity while the building owner earns revenue from the energy produced,” Kapoor said.

The ‘energy-as-a-service’ model is well suited for sites with strong daytime demand, including retail centres, office buildings, healthcare facilities and logistics hubs. However, adoption is expanding into apartment complexes and mixed-use developments as metering and billing arrangements evolve.

Battery storage is further strengthening the business case. By capturing excess solar generation during the day and discharging it during evening peaks, batteries enable owners to optimise timing and value of energy use.

“Solar generates power during daylight hours, but batteries allow that energy to be used or sold later. This means building owners can maximise the value of the electricity their property produces,” Kapoor said.

Storage systems are also opening access to emerging market opportunities. Through participation in Virtual Power Plants, buildings can dispatch stored energy during periods of high demand, when wholesale electricity prices can spike.

“In those moments, stored energy becomes very valuable,” Kapoor said.

Beyond direct revenue, integrated energy systems are emerging as a point of differentiation. Lower energy costs and improved sustainability credentials are increasingly influencing tenant decisions, particularly among commercial occupiers facing rising operating expenses and emissions targets.

“Energy supply is becoming a competitive advantage for landlords,” Kapoor said.

As electrification accelerates and distributed energy technologies mature, Kapoor expects the model to become

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