New Solar Homes Partnership Reaches Out to Low-Income Communities

When it comes to paying the bills, many residents find the cost of energy is no small matter.

A 2016 study found that the energy burden for the median low-income household was more than twice that of the average household’s.

The importance of offering solar energy to low-income communities was at the core of recent substantive changes made by the California Energy Commission to the guidebook of its award-winning New Solar Homes Partnership (NSHP) program.

Launched in 2007, the NSHP is the Energy Commission’s component of the state’s California Solar Initiative. It is offered to solar projects installed on new residential construction by providing financial incentives for homeowners, builders and developers.

The goal of the NSHP is to create a self-sustaining market for energy-efficient solar homes and help homeowners save money on electric bills. To date, the NSHP has installed nearly 67,000 solar systems. More than half of the systems are installed in large development projects where builders opt for solar as a standard feature.

Recent changes to the NSHP Guidebook, Tenth Edition include increasing incentive rates for affordable housing projects.

The NSHP provides two incentive structures – one for conventional or market rate housing and another for affordable housing. A major change in the guidebook is the increased dollar-per-watt incentive rate for remaining levels offered to eligible affordable housing projects.

In some cases, total incentives will increase from $0.80 per watt to $1.30 per watt. This is expected to increase interest among developers of affordable housing projects.

Eligible projects include single family homes, duplexes, condominiums, multifamily buildings and mixed-use buildings. Additionally, common areas in single and multifamily developments are also eligible, where the installation of solar is shown to create an economic benefit to residents.

Allowing common areas to receive incentives is a result of developers finding that solar systems in common areas for multifamily developments may be the only option for such developments to participate in the NSHP.

One change to the NSHP was removing the requirement that participants must have tax-exempt status to receive the higher affordable housing incentive. Another was expanding the permit application timeline from 60 days to 120 days after the issuance of a certificate of occupancy.

The timeline establishes a difference between solar installed on new homes versus existing ones. The 60-day window was too tight a deadline for some complex projects, particularly multifamily and affordable housing.

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California Energy Commission

The California Energy Commission is the state's primary energy policy and planning agency created by the Legislature in 1974.
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