For too long, solar energy has primarily been available to homeowners and businesses with significant capital to invest. However, recent studies and pilot projects are making the case for more renewable energy installation in low-to-moderate income housing developments. Let’s take a look at some of the factors that are encouraging this much-needed paradigm shift.
Lower Technology Costs
A few years ago, a pioneering study from Clean Energy Group found that solar+storage technology had become economically viable as a way to provide for the energy needs of multifamily housing developments. Titled, Resilience for Free: How Solar+Storage Could Protect Multifamily Affordable Housing from Power Outages at Little or No Net Cost, the study determined that “with the right market structures and incentives, solar+storage systems can provide a positive economic return on par with energy efficiency or stand-alone solar.”
As solar+storage systems continue to come down in cost, developers are now realizing that they will pay for themselves (and often provide a significant return on investment) over the lifetime of their housing projects. This incentive is important to housing developers, as it enables them to recoup costs, and a huge win for tenants as well, as it usually means much lower or even nonexistent electricity bills. Savvy developers are beginning to use solar and other energy efficient technologies as a selling point for potential tenants.
Successful Pilot Projects
On GreenTechMedia, Mike Mendelsohn of the Solar Energy Industry Association explores the success of Denver’s efforts to provide solar technology to low-income communities. While not without its challenges (primarily due to the lack of established pathways and the complications of HUD-owned properties), the city’s approach provides valuable lessons for housing developers and solar companies about future partnerships.
Mendelsohn writes that one of the successful approaches included entering into a power-purchase agreement (PPA) “focused solely on public housing, which narrowed and simplified the subsidy structure. The PPA was financed, owned and maintained by a third-party provider, which then sells the electricity to the DHA (Denver Housing Authority).” This enabled all parties involved to share the utility savings and also lift some of the monthly energy cost burden from tenants.
A second successful approach was embracing community solar. DHA recently financed a 2-megawatt solar system that “will power approximately 700 low-income units across Xcel Energy’s Denver territory, including DHA properties, other local housing authorities and affordable housing developers.” Community members can subscribe to the resulting energy plan, which was designed to lower utility rates by approximately 20%.
Solar Power World reflects on a 2018 report from the National Renewable Energy Laboratory titled “Rooftop Solar Technical Potential for Low-to-Moderate Income Housing in the United States.” It found that “nearly half of all the United States’ residential rooftop solar technical potential is on the dwellings of low-to-moderate income (LMI) households, representing 320 GW of potential solar capacity.” This new data promises to help both policymakers and energy stakeholders better understand the abundant opportunities for solar installation in LMI households.
One important finding was that by “including all roof space types (single-family owner-occupied, single-family renter-occupied, multi-family owner-occupied, and multi-family renter-occupied), solar generation can technically meet most electrical consumption for all income groups.” This report also endorses the community solar model, noting that “improving LMI solar access will require non-traditional rooftop (shared) solar models, such as community solar or virtual net metering” in order to make solar energy available to those with poor solar access.
While there is a lot of opportunity in this space, all parties acknowledge that more work needs to be done to make providing solar technology to LMI households and communities easier and more cost effective. This includes market and policy innovations around access to financing, educating LMI households about the benefits of renewable energy, and building incentive programs that would encourage developers to include solar technology in more of their projects.
At Solar Design Studio, we believe solar technology should be available to everyone. We work with each unique client to determine how best to achieve a significant return on their solar investment. If you’re ready to learn more about your own solar project, whether residential, business, or industrial, contact us today!