By Thomas Havens
On July 7, the Obama administration unveiled a series of executive actions and private-sector commitments designed primarily to make solar power more accessible for low-to-moderate income (LMI) communities. The initiatives seek to create opportunities to access solar energy for this largely overlooked segment of the population, including participation in the solar workforce and to advance “community solar” projects around the U.S. The administration is hoping to capitalize on the explosive growth in solar energy, driven primarily by plummeting installation costs (which have fallen by more than 50 percent since 2010) and increasingly favorable state energy policies. In the last year, according to the administration, the solar industry has added jobs at a rate 10 times faster than the rest of the economy.
Among the key elements of the new program:
∙ setting a goal of installing 300MW of solar energy at federally subsidized housing projects by 2020;
∙ providing direct technical assistance to affordable housing groups that commit to the solar program, in order to help educate customers on the process of going solar;
∙ improving access to Federal Housing Administration loan programs, under which eligible homeowners may borrow up to $25,000 to finance solar and other energy efficiency improvements; and
∙ launching a public/private National Community Solar Partnership to help unlock access to solar energy for customers who are unable to install solar panels at their homes or businesses.
To help meet these goals, the administration noted that a number of states, cities, nonprofits and investors had committed to building more than 260 solar energy projects in LMI communities or otherwise helping to further the development of community solar projects. Included in these commitments are pledges from 22 state and local public housing authorities to install solar and other types of renewable energy projects on their facilities.
In addition, dozens of private sector companies announced a variety of new solar energy projects in LMI communities, including more than 30 member-owned rural electric cooperatives in 17 states. Private- and public-sector companies also have made financial commitments of more than $520 million to advance community solar for LMI Americans, led by Clean Energy Collective”™s announcement that it had secured $400 million in financing to help grow community solar nationally.
The centerpiece of the administration”™s plan is the National Community Solar Partnership. This initiative builds on the growing interest at the state level in creating community or shared renewables programs as a means to expand access to clean energy for tenants, businesses or homeowners who lack a suitable location to site solar panels. Using a concept known as “virtual” or “remote” net metering, community solar projects permit multiple, unaffiliated customers in the same region of a state to purchase a fixed entitlement to the energy output of a large-scale solar project located nearby, with the project to be built, financed and operated by a third party (typically, an experienced solar developer). In the last few years, Colorado, Minnesota, Massachusetts, Hawaii and, most recently, New York have enacted community solar programs. New York”™s “Community Distributed Generation” plan is considered the most expansive thus far. Connecticut also recently created a community solar pilot program, although its size and scope is quite limited.
According to the administration, the National Community Solar Partnership will bring together federal agencies such as the Energy, Agriculture and Housing and Urban Development departments and a host of nongovernmental organizations and solar developers to create innovative programs using the community solar model, with a specific focus on LMI customers. Among the new community solar projects announced by the administration are Clean Energy Collective”™s 900 kW solar project near Corpus Christi, Texas, and 1.2 MW solar project in San Antonio, the first such projects to be built in Texas.
Community solar programs are seen by most policymakers and stakeholders as a necessary next step to further expanding the use of solar energy across the country. According to a recent report by the National Renewable Energy Laboratory, nearly 50 percent of U.S. households and businesses are currently unable to host a solar system, largely due to physical limitations like shading, rooftop condition or orientation. The same report estimates that, with the help of enabling governmental policies and incentives, expanding solar access to such customers through community solar programs could increase solar deployment by up to 11,000 MW in the next 5 years.
Solar programs such as the solar partnership, enabled by state policies to up customer participation, will create more opportunities to invest in and to develop large solar projects in our region and in the process help bring the economic and environmental benefits of clean energy to more Americans.
Thomas Havens is a partner in Day Pitney’s Energy and Utility Law department. Day Pitney operates nine offices, including in Greenwich and Stamford, employing 300 attorneys Thomas Havens may be reached at thavens@daypitney.com
