Local Solar Can Be Good For All Neighborhoods

Grid AlternativesSolar power in California has, in many ways, been an unparalleled success: the state has more solar power installed than the rest of the country combined. There are more solar workers in California (55,000) than working actors or utility workers. Solar workers earn a higher than average wage, and the industry is making strides in employing more women, veterans, and people of color. And, the median income of households installing solar in California in 2012 was between $40,000-$50,000, mostly middle- and working-class homeowners.

But there are two sides to this story because, unfortunately, solar power is still inaccessible to many low-income households.

Take my neighborhood of Boyle Heights, on the east side of Los Angeles, for example: over 70 percent of residents are renters and cannot install solar on roofs they don’t own. For those who do own their homes, many can’t afford to purchase their own solar system (the median income is just over $33,000) or don’t qualify for traditional financing. Residents here have captured a paltry $0.33 per capita in solar incentives over the past 15 years, as compared to Bel Air (yup, that Bel Air) which received almost $200 in solar incentives per capita – over 600 times more than Boyle Heights.

This isn’t completely unexpected as early adopters of technology typically have more discretionary income. It does, however, paint a stark picture of communities who have vs. those who have not.

Further, this is the case in many communities throughout the country: the 49.1 million households that earn less than $40,000 of income per year make up 40 percent of all U.S. households, but account for less than five percent of solar installations.

Solar Crossroads in California

The solar industry is at a crossroads in California, with the state’s utility commission deliberating on changes to its “net metering” policy. This practice allows customers to send the electricity they produce from their solar systems back to the grid and receive a credit on their bill. As part of the debate on net metering, the commission is considering new charges for solar customers – utilities argue these are needed to ensure everyone pays their fair share of “grid services” (transmission lines, maintenance, etc.).

Some say these charges would kill the industry by making it more expensive to own solar. If implemented, these changes could increase the average electricity bill for those with rooftop arrays from $65 per month to $135. A report from UC Berkeley found the proposal could “throttle demand” and “significantly, negatively affect rooftop solar adoption rates.” Similar fights are happening in other states that experienced early waves of solar success, like Arizona, where installations of local solar dropped 95 percent after similar charges were introduced.

At the center of many of these debates are the cost impacts to low-income communities, communities of color, and other vulnerable populations like seniors and fixed-income households. This is an extremely important issue, as these populations spend a greater portion of their income on utility bills and are more burdened by price spikes.

As I’ve written before, this concern is frequently used as an argument against clean energy. Sometimes these arguments come from elected officials and advocates with genuine concerns. While other times they come from industry or other groups who seem to be protecting their own interests: a 2014 study found local solar will have significant impacts on utility shareholder profits – up to a 40 percent loss for some.

It’s clear this dialogue needs some clarity, and also some soul searching. Solar power can be an asset for low-income communities, renters, and other vulnerable populations – but it’s not completely there yet. We need to continue to push the industry, the utility sector, and policymakers to make solar accessible to everyone, especially low-income communities. Anything less would be a squandered opportunity to do something truly revolutionary.

[Tweet “Local #solar can be good for all neighborhoods. @Jorgesays outlines ways to expand access: http://www.edf.org/WJz. “]

Not an unfair cost burden, likely an asset   

On the question of cost impacts: analysis from the Lawrence Berkeley National Laboratory found even the most aggressive net metering solar programs they studied would have nominal (0.1-2.7 percent) impact on electricity rates. Similar analysis from California, Nevada, and Mississippi public utility commissions found solar customers on average cover their full costs to the electric grid and provide a net benefit to all customers.

For example, rooftop solar offsets the need for “peaker plants” – polluting, expensive, fossil-fueled power plants that are only used a handful of hours a year to meet spikes in demand (like during a heatwave). Consequently, folks living near the polluting power plant who get their electricity from solar will enjoy cleaner air, and all customers will enjoy lower bills now that the peaker plant is needed less frequently.

In short, low-income communities are not in danger of being harmed by local solar power. In fact, they have the opportunity to capture multiple benefits from local solar power like good jobs, cleaner air, and more stable and affordable utility bills. But the next, more important question is how to reach the vast, untapped market of households who have not yet been able to access local solar?

Lower Costs and Better Programs

We’ve got reason for optimism that the benefits of clean, local, affordable energy can and will reach all neighborhoods and community members.

The cost of rooftop solar has dropped exponentially in the last decade, and is expected to continue dropping 61 percent by 2030. This, and programs that improve financing can keep solar within reach of middle class homeowners. But we can and must go further.

In California we have programs to provide no-cost solar on low-income homes, and groups like GRID Alternatives who have installed almost 6,000 solar systems on low-income homes in the state. New York is rolling out a program that doubles the incentives for solar projects on low-income homes, expected to support between 2,500 and 4,500 new residential projects.

Community solar is another way to make clean energy more accessible to renters and low-income households by eliminating the need for the upfront purchase or financing of a rooftop system. Utilities or a third party (like a non-profit or co-op) cover the cost of building a larger, shared-system in a neighborhood, which local residents can subscribe to. A community-sized solar system (around one megawatt or enough to fully power 250 California homes) can be 40 percent cheaper than a single home-sized system.

Significant decrease in costs, coupled with the continuation of proven policies like net metering, as well as meaningful programs like the ones listed above, could generate more local, equitably-distributed solar in communities all over the U.S.

Let the sunshine IN

Local solar power is at a decisive moment in California and throughout the country. Solar has been a bright spot for the economy, the environment, and people who have benefitted from programs to help alleviate barriers to access. However, the benefits have not been fully realized by large segments of our society.

California’s existing policies helped usher in the first wave of the solar revolution – now it’s time to push forward, not back. Changes to these policies being considered in California and many other states should not hurt current solar customers or make it unreasonably difficult for new customers to go solar. We need to ensure solar reaches new markets and diverse communities, especially those who could stand to benefit most.

Photo source: GRID Alternatives

This post originally appeared on our California Dream 2.0 blog.

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