Closing the Green Divide: Solar for Affordable Housing

Over the last five years, solar power has expanded dramatically in the United States, increasing its market share even as the price of oil has plummeted. The factors behind this expansion range from falling costs for photovoltaic (PV) technology, to legal battles that have transformed the energy market, to innovative financing structures that make it easier for firms and individuals to invest in solar.

Despite this progress, the residential solar energy landscape has developed along a “green divide”. Low-income communities, who are more likely to rent their homes and less likely to have access to the capital and credit necessary for solar investments, have little access to the solar revolution.

Clean energy advocates in the affordable housing sector are searching for ways to bridge the green divide through solar investment. Advances in metering and storage technology, combined with strategic policies to incentivize solar in a multifamily context, may be the key to delivering the benefits of solar to low-income renters.

Virtual net metering (VNM), for example, allows PV installations on a multifamily building to link to a specific apartment or cluster of apartments in the building, so residents see energy savings in their monthly utility bills. Net energy metering (NEM) allows tenants to sell excess energy to the grid. This is particularly useful in a residential context because peak solar production is in the middle of the day, when residential energy consumption is at its lowest. If local regulations prevent NEM or decrease its value (as is the case in New York), batteries can be used to store excess energy until residents need it.

Affordable housing policy can help make these technologies available and feasible for these multifamily buildings. In October 2015, for example, California passed a bill establishing the Multifamily Affordable Housing Solar Roofs Program. This program is the first that integrates subsidies for PV installation, energy storage, and energy efficiency improvements for multifamily affordable housing. By strategically leveraging new technology, programs like this can help overcome the green divide.

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