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Denver Project Breaks Down ‘Disincentive Barriers’ to Low-Income Community Solar

The Denver Housing Authority (DHA) has figured out how to deliver solar to low-income neighbourhoods, working around thorny questions about the types of housing involved and who pays for the energy that have often scared off solar developers in the past.

In a post for Greentech Media, Mike Mendelsohn, senior director of project finance and capital markets at the U.S. Solar Energy Industries Association, points to a contrast that has bedeviled advocates of climate and energy justice: while Apple’s new headquarters in Cupertino, California has 17 megawatts of solar panels on its roof, the average, subsidized low-income housing development down the street in your neighbourhood likely doesn’t, even though renewables are supposed to be the energy technology for the rest of us. Now, DHA is working to break down the “disincentive barriers” to community solar through third-party power purchase agreements and initiatives like its 100% Low Income Community Solar Garden.

Mendelsohn notes that many public housing developments incorporate multiple unit types “into one building behind a single electrical meter,” adding a level of complexity that doesn’t always exist with market housing. And because government agencies often pay for a large share of the electricity in subsidized units, either directly or indirectly, “there is often little incentive for local housing authorities to take the risk of investing and making a long-term (20-year) commitment,” since the savings will “not be retained by the housing authority or the tenant.” 

DHA Portfolio Energy Manager Chris Jedd advised solar developers anxious to help plant other community solar gardens to “thoughtfully think through the subsidy structures to optimize benefit flow and minimize risk,” and identify “local champions within the housing authority”. Mendelsohn recommends early contact with agency CFOs “to explain how the cost reduction benefits can allow for expansion of their mission to provide affordable housing.”

He also underscores the importance of local advocacy, noting that regional utility Xcel Energy will be “specifically including nonprofit affordable housing providers in new, dedicated community solar programs that serve low-income customers, and will solicit bids for almost 20 megawatts of such projects through 2019.”