American author and activist James Baldwin once said, “anyone who has ever struggled with poverty knows how extremely expensive it is to be poor.” Energy in America is no exception. As the U.S. Department of Energy explains, “low-income households pay a disproportionately higher share of income toward energy-related expenses.” The share that a household pays toward energy is known as an energy burden.
Addressing the Solar Equity Gap
First, let’s talk about the challenges for low-income communities when it comes to energy. Low-income families are far more likely to have outsized energy burdens for a few reasons: Low-income families are more likely to rent (and renters typically foot the bill for electricity) Low-income families are more likely to live in climates with extreme heat and humidity, requiring greater energy for climate control Landlords with renters have little incentive to upgrade a home’s energy efficiency Low-income areas are more likely to have poor energy infrastructure, increasing the costs associated with transmission and distribution (and therefore overall rates) Don’t even get me started on who can afford electric vehicles, avoiding the rising gas prices. Let’s let the data tell the story. According to the American Council for an Energy-Efficient Economy (ACEEE) The median energy burden of Black households is 43% higher than that of white households The median energy burden of Native American households is 45% higher than that of white households The median energy burden of Hispanic households is 20% higher than that of white households Bear in mind that these lower-income demographics are also the most affected by a changing climate and environmental pollution.
Next, let’s talk about finances. When looking at solar, it’s important to think of it as an investment. Similar to buying a home with a loan, financing a solar energy system provides the most long-term value to those who can afford the largest down payment and secure the lowest rates with high credit. This barrier to entry presents huge challenges to low-income families.
Colorado Energy Office Rooftop Solar PV ProgramThe Colorado Energy Office (CEO) Weatherization Assistance Program (WAP) offers financial assistance for rooftop solar equipment to specifically target those impacted by high energy burdens. WAP projects have been able to save rooftop solar clients more than $400 annually by reducing their electricity costs.2 In addition to solar panels, the program also offers assistance with:
- Energy audits
- Energy conservation education
- Air infiltration sealing
- Insulation in attic, floors and walls
- Furnace repair or replacement
- LED light bulbs
- High-efficiency appliances
- Air source heat pumps
New York Affordable Solar Program New York’s Solar Program, also known as NY-Sun, incentivizes solar contractors and developers to offset the cost of going solar throughout the state. Incentives are sent directly to participating contractors who use the funds to accept customers from lower income brackets that normally would not be able to afford the cost of solar. Incentive rates will vary. To be eligible, you must be earning 80% or less than the area median income.
Benefits of Solar Energy Although solar can be a big investment, it actually helps homeowners save thousands on energy bills in the long run. In fact, in the U.S., the average solar household saves more than $22,000 over their panels’ 25-year lifespan — but most systems will last beyond 25 years, providing an even greater return on investment.
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