Clean Energy for Low Income Communities: Community Solar

CELICA Partners saw community solar as a key pathway for low-income households to receive the benefits of renewable energy. This pathway is of particular interest where there is concern about affordability of a residential system, technical restrictions (e.g., where solar potential is limited, roof repairs are needed, etc.), or where households may move more frequently (community solar subscriptions are generally portable). It is also of interest given that more than half of low-income households are renters and do not own and make decisions about what can be installed on their rooftops. Low-income community solar programs provide a solution that may address these barriers to accessing renewable energy.

Nineteen states have statewide community solar policies and programs, and over forty states have community solar projects. Additionally, states are beginning to mandate that portions of community solar shares be reserved for low-income subscribers. In most instances there are dedicated programs serving low-income households, leaving other programs to provide market rate solutions.

CELICA Program Models

Below are low-income community solar program models explored with partners in CELICA. Some models focused specifically on how state and local program administrators and partners can develop community solar projects in low-income areas. Other models integrate energy efficiency with community solar for more robust cost savings.

Subsidized low-income community solar subscriptions

Low-income community solar programs typically provide a substantial subsidy to participating low-income households to maximize how much their energy burden is reduced. Programs are more effective when they coordinate with existing community support organizations, like local governments and community action agencies, to reduce the administrative burden associated with recruiting and managing low-income subscribers. The CELICA Case Study: Colorado's Approach to Low-Income Community Solar Programs that Leverage Weatherization Networks provides an example of how to coordinate and support such an effort.

Models of subsidized low-income community solar programs by CELICA partners are described below.

Low-income community solar integrated with low-income energy efficiency

This CELICA partner program model offers energy efficiency with community solar benefits to participating households to gain greater energy savings than by either alone. As the lowest cost long-term resource to address energy burden of low-income households, energy efficiency can reduce energy demand thereby helping stretch limited low-income community solar subscriptions further. Collaborations between state agencies and local government and nonprofit organizations can help cultivate robust participation by low-income households and maximize benefits available across multiple programs.

Examples of CELICA Partner programs that integrate energy efficiency and community solar for low-income communities are described below.

As described in the CELICA Promising Practice: State Partnerships with Electric Cooperatives for Low-income Community Solar and Weatherization, the State of Michigan’s program offers community solar subscriptions that are expected to provide an average of $350 per year in additional energy cost savings to households that had their homes previously weatherized, further reducing energy burden. Michigan provided State Energy Program funding that was then matched 3-to-1 by a rural electric cooperative. A local community action agency helps recruit and manage low-income subscribers that previously had their homes weatherized, with these services offered in addition to those provided with Weatherization Assistance Program funding.

Colorado’s low-income community solar model as featured in the CELICA Case Study: Colorado's Approach to Low-Income Community Solar Programs that Leverage Weatherization Networks provides another example of the potential benefits of programs that link energy efficiency, energy bill assistance, and solar energy services. The state and its utility partners have also linked energy bill assistance and weatherization to low-income community solar programs, particularly relating to recruiting participants and managing low-income participant subscriptions. In addition, it was the first state to incorporate rooftop solar into its Weatherization Assistance Program projects.

Low-income community solar programs that partner with community institutions

Community institutions include nonprofit social service organizations, faith-based organizations, housing providers, and community action agencies, among others. Partnering with community institutions may bring knowledge about and connections to low-income communities that are essential to the success of low-income energy programs. These organizations may also be able to provide a physical site to locate a community solar garden.

Read more about examples of community solar programs that partnered with community institutions below.

As described in the Promising Practice: Engage Community-based Organizations as Anchors for Low-Income Community Solar Projects as an offtaker of last resort, which is an organization that serves as a backstop to use and pay for excess power that becomes a financial liability if there are fluctuations in power demand.

One example of this is the Denver Housing Authority, a community service provider that has the relationships and knowledge needed to work through the complexities of establishing and operating a community solar project for low-income housing. The Denver Housing Authority is able to co-invest and serve as an anchor subscriber, offtaker of last resort, or simply promote and recruit low-income participants. More information on Denver Housing Authority’s work in this area can be found in the CELICA Issue Brief: Reducing Energy Burden for Low-income Residents in Multifamily Housing with Solar Energy.