Fighting Inequity with Solar Power

Minneapolis’s 4d program to boost energy efficiency and affordable housing in the city is kicking it up a notch.

Photovoltaic panel installation on the roof of Green Rock Apartments

Credit: Will Hommeyer

A year ago, what you’d find atop the Green Rock Apartments complex in northeastern Minneapolis was a typical flat building roof baking in the sun. Today, an array of dozens of south-facing photovoltaic panels soak up that sunlight, providing the building with up to 30,000 kilowatts a year—or 100 percent of its electric needs.

The project, installed by local solar developer Adapana Solar Technologies, is part of Minneapolis’s push to decrease its carbon emissions while increasing the availability of affordable housing in the city. “We’re trying to address climate change,” says Patrick Hanlon, Minneapolis’s director of environmental programs. “At a local level where we’re focused, those solutions can also be an antidote to inequity.”

This is where the city’s 4d Affordable Housing Incentive Program, which provides tax incentives to landlords who set aside rent-controlled units, comes in. To sweeten the pot, building owners enrolled in the program can now also receive rebates from utilities and the city for installing solar installations and for efficiency upgrades.

The more energy efficient a home is, the less drafty and more affordable it will be when it comes to energy bills. And when considering Minnesota’s extra-cold winters, those differences in comfort levels and heating costs can really add up.

“Energy efficiency is the cheapest form of energy,” says Ben Passer, the energy access and equity director for Fresh Energy, a group that works with Minneapolis to provide efficiency upgrades to residents. “It’s important that everyone has access.” Over the past year, Hanlon says, the 4d program has also played a role in an effort to rebuild nearly 1,000 buildings, including many BIPOC-owned businesses, that sustained significant damage or burned down last May during the unrest that followed the killing of George Floyd by a Minneapolis police officer.

Minneapolis is prioritizing solar development on 4d buildings and in “green zones,” which the city identifies as areas where environmental problems disproportionately affect low-income households and communities of color. The goal is to ensure a more equitable distribution of the benefits provided by cleaner power and energy efficiency while keeping the apartments that feature those perks within financial reach for a larger number of city residents.

This is a crucial need. Since 2010, the Twin Cities of Minneapolis and St. Paul, Minnesota, have gained about 75,000 new residents, with the population of Minneapolis (currently 420,000) growing faster than it has since 1950. The boom is due in part to an increasing number of corporations operating in and around the two cities. Around the same time, the 2008 recession slowed new housing development, which created a general housing shortage and led to gentrification. Making matters worse, any new construction that did occur often came with steep rents.

To address the problem, the city offered some incentives to building owners. First, they can join the 4d program if they commit to making at least 20 percent of the units in their buildings affordable—a monthly rent of $1,164 or less for a one-bedroom, for example—for a decade. By keeping rents below these ceilings determined by the city, the owners get a 40 percent reduction on property taxes for those units.

The owner of this building is able to keep rents low, thanks to reduced taxes and 90 percent cost share on a new boiler, water heater, and wall insulation.
Credit: City of Minneapolis

4d enrollees also receive an energy audit that identifies how their buildings could become more energy efficient—installing wall and attic insulation or replacing furnaces are among the more popular improvements. The city, in partnership with the utility Xcel Energy, even helps foot the bill, collectively offering $0.90 for every dollar spent on certain upgrades. Last year, Minneapolis funded 68 such efficiency enhancement projects.

The 4d program pairs well with Minneapolis’s Climate Action Plan, which strives to cut the city’s carbon emissions by 80 percent from 2006 levels by 2050. To help it get there, Minneapolis was chosen as one of 25 cities in the American Cities Climate Challenge, a partnership between Bloomberg Philanthropies, NRDC, Delivery Associates, and several other organizations to reduce emissions in the buildings, energy, and transportation sectors. The city has made headway, but its reliance on fossil fuels for the heating and cooling of buildings has slowed progress down.

Minneapolis’s 4d unit density by neighborhood, 2018–19 (left) and a detail of the city’s interactive Find My Solar Suitability map (right)
Credit: City of Minneapolis Sustainability

A recent analysis conducted by the University of Minnesota showed that Minneapolis could get more than 35 percent of its energy from the sun. Right now, though, solar is only generating about 1 percent of its needs. But pair solar power with energy efficiency savings in the rising number of interested owners of 4d buildings, and that gap begins to close. And things are even looking brighter now that Minneapolis plans to scale up the program as part of its $280 million in federal COVID-19 stimulus spending for health and climate issues.

Installing solar arrays requires planning, capital, and investment, but it’s catching on. The city funded 147 solar arrays last year. “We’re a long ways away from seeing the end of the road,” says Minneapolis director of environmental programs Hanlon.

Minneapolis also reimburses solar-equipped 4d buildings for the power they generate, offering a higher rate per kilowatt-hour for installations within green zones. (See a solar suitability map for buildings in the city here.) Andy Goke of Adapana Solar Technologies says building owners have to find the contractor, but in the end, the numbers make financial sense. A federal tax credit, for instance, can offer a big enough discount to help the array pay for itself within seven years.

Over the past two years, the city has enrolled more than 700 housing units that are now maintained as affordable housing. The energy audits and resulting efficiency projects provide a baseline for how much energy buildings can save and where—whether building owners act right away or a few years down the line.

Green Rock Apartments owner Dale Howey is now busy planning to install a solar array on a small parking garage this spring. As an environmentalist who offers green products and renewable power access to his tenants, he says joining the 4d program was an obvious choice. “The 4d plan is an accelerant,” Howey says. “I’m putting solar panels every damn place I can stick ’em.”

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