National Grid is proposing to install solar energy systems on the rooftops of 100 homes in the Fruit Belt as part of a project to test whether neighborhood solar projects in lower-income areas make economic sense and can be duplicated elsewhere.
Under the $3.7 million proposal, National Grid would install solar panels on the roofs of 100 suitable homes in the neighborhood and sell the power that those solar systems generate into the state’s electricity market. The proceeds from those electricity sales then would be used to reduce the electric bills of the residents of those 100 homes, plus an additional 50 additional households that applied for the program but were turned down because their homes were not suited for rooftop solar energy.
“We wanted to engage the local neighborhood to investigate how we could install solar on a number of homes,” said Dennis Elsenbeck, National Grid’s regional director in Buffalo.
National Grid estimates that the program, which will cost $2.4 million after accounting for the state and federal tax subsidies on rooftop solar systems, will reduce the total electric bills of the 150 participating households by 20 percent to 25 percent.
The idea behind the project is to see if a so-called “neighborhood solar” program can be an economically viable way of spreading renewable energy to lower-income areas. If it proves successful, Elsenbeck said he hopes other businesses, ranging from utilities to energy services companies, may be tempted to try to use the same model for programs of their own in other low-income areas.
Low- and moderate-income residents tend to pay a higher share of their disposable income toward their electric bills, so reducing the bills of participating households by an estimated $18 a month would ease some of the burden on their monthly budgets caused by energy costs. And by making their bills more affordable, it also would help reduce the drain on National Grid caused by consumers who don’t pay their bills, easing a delinquency problem that costs the utility a little more than 1 percent of its revenues annually.
National Grid proposed the project this week as part of the state’s broader initiative to revise the way its electricity markets are structured. The proposal must be approved by the state Public Service Commission.
“The object is to build something that’s not one of its kind, but the first of its kind,” said Paul Tyno, the director of energy initiatives for the Buffalo Niagara Medical Campus.
“If it just stands alone and doesn’t go anywhere, then we’re not learning enough,” Elsenbeck said. “The real success will be in the manner that it spreads and it’s replicated.”
Residential solar energy systems across the country have tended to be focused mostly on moderate- to higher-income consumers. A recent report by the Center for American Progress warned that, unless financial barriers were lifted, low- to moderate-income consumers would face a wider “electrical divide” that leaves poorer residents bearing the brunt of the costs from outdated utility systems.
“The growth of shared solar facilities in low-income communities is a hopeful trend,” said Aaron Bartley, executive director of PUSH-Buffalo.
So-called “community solar” projects have been gaining traction across the country as a way for people whose rooftops aren’t suited for solar panels to invest in and reap the rewards of solar panels that are located someplace else. GTM Research forecasts The community solar market, which had a total of 66 megawatts of generating capacity installed at the end of last year, is expected to grow five-fold this year, with 115 megawatts of new generating capacity being installed, up from 21 megawatts in 2014, according to a report last month by GTM Research. Under the proposal, National Grid would install 5-kilowatt rooftop solar systems on 100 homes in the 36-block Fruit Belt neighborhood. The homes would be selected from a pool of residential customers who volunteer for the program under outreach efforts planned by National Grid, the medical campus’ community relations staff and neighborhood groups.
Those efforts are expected to yield a pool of 300 potential participants, which then would be narrowed following an examination of their homes to determine how suited they would be for rooftop solar. Those factors would include whether their roofs face toward the south and how much potential sunshine could be captured, as well as the condition of the structure and whether significant upgrades would be required to support a solar energy system, National Grid said in a filing with the PSC.
Once the 100 homes are selected for rooftop solar systems, National Grid then would select another 50 customers from the initial pool of applicants to participate in the program. Those consumers would receive the savings from the neighborhood solar project, even though no panels would be installed on their roofs.
The participating residents would not have to pay anything toward the cost of the rooftop solar energy systems. The residents also would receive a home energy audit that could lead to minor or moderate structural repairs or upgrades to a home’s electrical panels, in addition to weatherization improvements, such as air sealing.
National Grid also is proposing a second demonstration project on the medical campus that would develop a system to help it better manage its on-site generating capacity, including back-up power systems and solar energy, to lower costs and reduce the need to invest in new electrical infrastructure.