Taking its cues from a successful program in Connecticut, Rhode Island is poised to launch a new initiative to deploy solar and reduce electricity costs in homes owned by low- to moderate-income residents.
The Rhode Island Commerce Corporation recently issued a request for proposals from solar companies interested in partnering on the initiative, called Affordable Solar Access Pathways. The program will offer affordable leases for solar equipment on homes owned by residents with incomes less than or equal to 80% of the area median income. That’s a maximum of $65,460 annually for a family of four, or $44,512 for a two-person household.
“There will be no money down and net savings from day one,” said Vero Bourg-Meyer, project director at the Clean Energy States Alliance, or CESA, which collaborated with the Commerce Corporation to develop the program.
The homes must be located in environmental justice areas, as defined by the state Department of Environmental Management. Those areas are primarily in and around the cities of Providence, Pawtucket, Woonsocket and Newport.
That will enable the program to take advantage of the new environmental justice adders to the Investment Tax Credit passed as part of the Inflation Reduction Act. Those adders will allow solar system owners to qualify for a higher tax credit when homes are located in census tracts designated as environmental focus areas, Bourg-Meyer said.
CESA has been working to persuade states to develop more-inclusive solar programs by promoting Connecticut’s Solar for All program as a model. Under that program, the Connecticut Green Bank paid incentives to a solar company, Posigen, which was then able to offer a reduced price to customers for a 20-year rooftop solar lease.
The program helped drive a 185% increase in solar in low- to moderate-income communities in Connecticut between 2015 and 2018, according to a 2020 white paper.
Third-party ownership of the solar equipment was a critical aspect of that program’s success, Bourg-Meyer said, since lower-income customers are less likely to be able to obtain or afford financing.
Another key aspect was the program’s community-based marketing — “having neighbors speak to other neighbors about it,” she said.
Rhode Island’s program will be administered through the commerce agency’s Renewable Energy Fund, which will provide an initial $1 million in funding, in collaboration with the state Office of Energy Resources.
It’s not clear how many homes that $1 million will cover, as it will depend on how the program’s solar partner designs its program and incentives, said Shauna Beland, administrator of renewable energy programs at the energy office.
“The more creative they get the better,” she said.
There are no funds available to help out homeowners who need roof repairs in order to accommodate solar panels. But it’s possible that the solar installer will work with a roofing contractor and wrap those costs into the lease, something that is fairly common in Rhode Island, said Karen Stewart, manager of the Renewable Energy Fund.
The program should launch this spring.
Hawaii launched a solar program for low- to moderate-income homeowners last year, and Virginia is working on it, Bourg-Meyer said, adding, “it’s something that’s percolating across the country.”
Numerous studies have found widespread inequities in solar adoption across the country. However, a 2020 report from Lawrence Berkeley National Laboratory concluded that those disparities are gradually diminishing, with several states, including Connecticut, even demonstrating income parity between solar adopters and the broader population.