America has been in a solar energy boom. Solar installations have increased over 400 percent since 2010. As usage has grown, the cost of solar energy has dropped dramatically, further fueling adoption and growth in rooftop solar, commercial projects, and even utility projects. This solar energy boom reduces the need for electricity from dirty power plants, reduces utility bills, and creates thousands of jobs.
The growth in residential rooftop solar has been particularly strong, but it raises an important concern: families in rental housing can be left behind. Renters don't own their rooftops. It's typically difficult to persuade a building owner to invest in a solar system to reduce tenants' utility bills, even if it makes financial sense to do so, and even with incentives. Owners of subsidized affordable housing face additional barriers to financing and installing a solar facility (for more detail, see Bridging the Solar Income Gap).
This is the focus of the President's new new solar initiative. Announced today, the initiative shows leadership and the importance of concerted action to assure all Americans have access to the benefits of clean energy, especially renters and low to moderate income families.
The concern about leaving renters behind is very real. We have seen a similar outcome with energy efficiency in rental housing. Efficiency repairs and improvements (such as fixing weather-sealing, tuning-up air conditioners and heaters, and installing better lighting controls) are needed, create real value for residents and owners, improve the quality of housing, and deliver value to the utility. Yet owners often defer making these needed repairs and improvements, even with incentives available to support installation. Studies present a clear picture of this reality. One recent study of affordable rental housing in 9 states shows cost-effective energy savings of over 20% in affordable housing buildings. Other studies show similar results.
This is why we launched the Energy Efficiency for All project. Utilities are positioned to help owners repair and improve rental housing to waste less energy. But we've learned it takes concerted action to assure programs nominally available to all actually reach residents of affordable housing. Utilities in many states, such as New York, Maryland, and Minnesota, have recently implemented better programs to help renters (and all low income customers) realize the benefits of energy efficiency. Some leading owners of affordable housing (such as the National Housing Trust) have undertaken efficiency projects in their own properties, proving the value to owners and residents and providing project blueprint. But there is much more work to be done.
Against this backdrop, the Administration's new solar plan makes sense. Key elements of the plan include:
1. Commitments from affordable housing owners to install solar and other renewable energy facilities. The goal of 300 megawatts will mean thousands of families save on their utility bills and can put those savings to better use. The projects will come from public housing agencies, such as New York City Housing Authority, and private owners such as Mercy Housing.
2. A partnership to promote Community Solar projects. Community Solar allows households to receive the benefits of puchasing a fractional share of a solar facility. How-to guides and commitments from companies that implement projects should produce real, on-the-ground faciltities.
3. Correcting policies at the Federal Housing Administration to assure the value of solar facilties is captured in the process of making mortgage loans.
4. Giving Rural Electric Co-ops tools to help their customers to invest in renewables projects. This builds on the existing program that allows co-ops to borrow low-cost funds from the Treasury to use to help customers invest, including renters.
5. Enhancing workforce development through various agency actions, including Americorps to reach low-income communities.
The White House Fact Sheet describing the new solar initiative does not focus on the role of utilities, but of course electric utilities must be important partners in the endeavor to adopt more clean energy. Consider the need for utilities to help building owners to connect to and maintain the power grid. NRDC's fact sheet describes the key policy considerations. Also, see reports here and here for descriptions of how utilities can implement large-scale solar facilities in ways that benefit all customers.
Most important, utilities play a vital role in helping building owners -- including owners of rental housing -- in the primary task to reduce energy waste and make their buildings more energy efficient in the first place. This efficiency work is a priority. It can improve the lives of residents, lower their bills, and make buildings better candidates for investments in solar.