Getting rooftop solar onto low- and middle-income housing

In this episode, Vero Bourg-Meyer of the Clean Energy States Alliance discusses the barriers that keep lower- and medium-income customers from installing rooftop solar, the types of efforts most likely to overcome these barriers, and how to keep momentum moving forward.

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Text transcript:

David Roberts

For all its explosive growth in recent years, rooftop solar is far less frequently installed by low- and middle-income households than by wealthy ones. Though that disparity is diminishing somewhat over time, it remains large.

The barriers keeping lower-income consumers from solar go well beyond the financial (though financial barriers are substantial), ranging from credit histories to low-quality and poorly insulated buildings to lack of supportive policy.

State policymakers, foundations, and non-profit groups have been trying for years to overcome this problem. Finally, the pieces are beginning to fall in place and it is becoming clearer which kinds of interventions work and which kinds don’t.

No one knows more about the history, design, and successes of these programs than Vero Bourg-Meyer of the Clean Energy States Alliance. She has been analyzing and advocating for these policies for years (she just came out with a report on how foundations can help), so I was eager to talk to her about the rationale for low-income solar programs, the features that make them work, what's in the Inflation Reduction Act that can help, and what further policies are needed.

Okay, then, with no further ado, Vero Bourg-Meyer, welcome to Volts. Thank you so much for coming.

Vero Bourg-Meyer

Well, thank you so much for having me. I'm delighted to be here.

David Roberts

Cool, so there's a lot to talk about here with this topic, which I've had sort of, like, in the corner of my eye for years and years now, these programs for low-income and mid-income solar, getting solar to low-income, mid-income people, I sort of had it on my periphery forever. And so I'm happy to jump in directly. My sense of the sort of state of play among the wonks is the best way to help poor people is to give them money. And if you have money to help them and you want to do something other than just give it to them, you need to sort of justify, like, why is this better than just giving them money?

Vero Bourg-Meyer

Yeah.

David Roberts

So I guess to start with, my first question is just why should we care about specifically getting solar on these households versus just helping them with money? So what is the sort of justification for this kind of whole area? Why do we want to get solar on low- and middle-income households?

Vero Bourg-Meyer

Well, so there are two questions in there, right? So one question is that there's a climate question. Obviously, we want solar not because we think it's great for savings and all that, but also because we have a climate crisis that's ongoing and we need to do something about this. So that's the reason why we want solar. But why LMI communities and I'll use LMI in a kind of loose way. LMI stands for low- and moderate-income. LMI sometimes is just low-income and that generally means kind of in this area, generally it means below 80% area median income.

Some people also define it as below 120%, but without going too much in the details, that's generally what it means. So the reason why you want to make sure people have access one of the reason you want to make sure those people have access to solar is they spend a much higher percentage of their income on their utility bills as the rest of us. About almost four times as much as you or me. And I'm lumping us in the same income brackets. I don't know if that's correct. So they spend a lot of money on their utility bills.

And so obviously when you're giving them away month after month after month to reduce those utility bills, that can have a really outsized effect on them. Right? So it's not just the cost of purchasing the solar to begin with, it's the continuing saving over the lifetime of the asset that you'd have to kind of look at.

David Roberts

It's kind of like giving them money every month.

Vero Bourg-Meyer

Yeah, essentially. Yeah. Assuming there is a saving, which it has to be structured that way. It doesn't just happen like that. And then there is the resilience benefit that you can get when paired with batteries. And I was saying earlier, I'm going to use low-income communities as kind of LMI communities, very generally speaking. But we're also talking here about communities of color in communities that generally, because of redlining, have older housing stock houses that are not well insulated. When you start with that and you add storage, you get a really huge resilience benefit for them.

LMI also means higher rate of chronic diseases, right. So you need your dialysis machine to work all the time, not just some of the time. So that's another really big reason. But I'd say your question though, about why not just give them money? If you kind of put aside, is it politically pragmatic to just give them money? Which I don't think at this stage it is. We tend to wage a war on the poor instead of waging a war on poverty in this country, right?

David Roberts

Yes.

Vero Bourg-Meyer

So setting that aside, if you're looking at who deploys the solar in this country, it's the private sector, right? And there are other barriers that are kind of standing in the way of LMI communities getting solar other than just the initial funding. The initial funding is a big part of it, but there's also lots of other reasons why customers don't trust the developers. Developers are not interested in serving or generally not all of them.

David Roberts

Let's talk about those a little bit. Let's talk about those barriers. Because I know intuitively, as you say, the obvious barrier, I think, which jumps out at everybody is just not enough money. That's what low-income means. But that's not the only reason that deployment of rooftop solar is lower in these communities even than what you would predict based on income, right? The barriers that go beyond income. So let's talk about some of those. Like, what are the kind of things that are stopping these households from accessing rooftop solar?

Vero Bourg-Meyer

Well, so the funding one, I don't want to just fully put it aside, right. Because that's a really huge one, the upfront cost, and just for your listeners who may not be familiar with the cost of solar for a regular household. So if you look at the average size of a solar asset in this country, which is about seven kilowatt, I believe, and then the average cost between $3 and $4 per watt. So that's what? That's $25,000, roughly, that you have to find.

David Roberts

That's not small for anyone ...

Vero Bourg-Meyer

It's not small. And that upfront cost you and I have access to other kind of funding. We have access to financing, right? Low-income communities might people might have a lower FICO score