With new and potential changes to utility rates and structures in California, the savings generated by rooftop solar power could fall by as much as 50 percent for those in multifamily affordable housing. However, a new study from Clean Energy Group showed that solar+storage could restore and increase—by up to eight times—the savings to those in multifamily affordable housing with solar power in the state.
Clean Energy Group has been active in helping low-income communities and go solar and use energy storages. It recently issued seven grants to help community-based nonprofits and affordable housing developers build organizational capacity to add in solar and energy storage systems.
“The policy and rate changes that are happening right now in California will have a major impact on the state’s solar customers, and it won’t be long before we see these same trends repeat themselves in other leading solar states,” said report co-author Seth Mullendore, a project director at Clean Energy Group. “This new economic analysis is yet another indicator that the future success of solar will increasingly depend on energy storage.”
As California utilities shift their rate structures to include demand costs and time of use charges, while seeking to reduce net-metering, they’re adding costs to consumers and reducing the value of solar power. This will affect those in affordable housing more than others as more of their limited income is focussed on paying for their energy use than those who make more.
The study comes as California prepares to ramp up support for low-income solar through its Multifamily Affordable Housing Solar Roofs Program. The program could allocate up to $1 billion to develop solar energy systems over the next decade.
“The sheer magnitude of negative impacts that we found should serve as a warning sign for California’s affordable housing sector,” said Wayne Waite, who co-wrote Clean energy Group’s Solar Risk: How Energy Storage Can Preserve Solar Savings in California Affordable Housing. Waite is a program and policy consultant for a nonprofit coalition of California environmental justice and housing advocates. “The proposed policy and rate changes could lead to a significant increase in demand charges along with the devaluation of stand-alone solar due to later time-of-use periods—in short, higher electric bills for solar customers,” he said.
The study found that as such changes are made, effectively managing a building’s electric demand with energy storage could create additional savings allowing its residents to enjoy the savings from solar power that they were previously experiencing. Already, the property’s total energy bill savings could be amplified by energy storage, according to the study. “In a scenario where storage allowed the property to switch utility rate tariffs, the integrated solar-plus-storage system could deliver more than eight times the savings of a solar-only system under the proposed changes,” Clean Energy Group explained.
The organization modeled its study on a 50-unit affordable housing building in San Diego. It used a rate tariff it said would be widely applicable to medium- to larger-sized commercial properties in the region.