Solar Power to the People: Coalition Hopes to Bring Clean Energy to Poor Families

Tom Johnson | December 10, 2019 | Energy & Environment
The benefits of clean energy are manifold, but the catch is determining where $125 million in annual subsidies will come from
solar panelsCredit: Creative Commons
New coalition wants a quarter-million low-income families to go solar by 2030

A persistent criticism of the state’s efforts to promote clean energy has been that most of the benefits of its aggressive program to install solar panels on homes have gone to households with higher incomes.

A new coalition of climate and solar advocates and state lawmakers is aiming to remedy that flaw by creating a roadmap that ensures low-income populations and environmental-justice communities share in the benefits of a clean-energy economy, like less pollution and fewer health problems.

Extending clean energy to low-income families

The roadmap sets ambitious goals for bringing clean energy to those sectors. It calls for having a quarter-million low-income families go solar by 2030, installing 400 megawatts of storage and setting aside $125 million annually in state funding to achieve those goals.

“We envision a clean-energy future for New Jersey that is resilient, equitable, inclusive and community-centric,’’ said Pari Kasotia, mid-Atlantic director for Vote Solar, which put together the coalition. “We must be bold and visionary to assure our most vulnerable and underserved neighbors benefit and thrive in this economy.’’

But advocates did not detail where they would get the $125 million a year to pump into promoting clean energy to promote solar in low-income and environmental-justice communities at a time when ratepayers are facing new costs to support nuclear power, offshore wind and other clean-energy initiatives from the Murphy administration.

The announcement, however, came on a day when the Legislature was debating a bill (S-4275) that aims to give the state more flexibility in crafting a transition program to fund new solar projects while at the same time limiting how much utility customers have to pay to incent solar installations.

The dual events underscore the contrasting priorities facing policymakers: how to aggressively promote solar projects while at the same time limiting costs to utility customers, who, so far, have paid more than $2.6 billion in subsidies to drive installations in New Jersey over the past decade.

The bill would give the New Jersey Board of Utilities authority to shift some projected savings under a new cost cap for solar programs to later years. The proposal would allow solar projects to continue to be built, without exceeding the cost cap, which was imposed under a new law to rein in costs for these projects.

Warning from rate counsel

Division of Rate Counsel director Stefanie Brand did not oppose the bill because under it ratepayers will not pay more in subsidies to promote solar projects. But Brand warned lawmakers their constituents’ bills will go up under other provisions of a Clean Energy Act passed in 2018.

“Your constituent bills will go up,’’ Brand said, saying it is important to know how much the state is paying for what amounts to about 5% of the state’s energy needs.

“Using EY (energy year) sales data, the 9 percent cap represents $876 million in ratepayer subsidies per year,’’ she said. “The 7 percent cap represents a $683.4 million cap per year. This is not small change.’’

Where most of those subsidies are flowing is a major concern of many clean-energy advocates, who want to shift subsidies to low-income and environmental justice communities, which, to date, have not shared in the benefits of the clean-energy program.

The average household income for homes where solar has been installed is $140,000 a year, according to Doug O’Malley, director of Environment New Jersey. “The roadmap is a way to fix that,’’ he said.

But even lawmakers and BPU president Joseph Fiordaliso ducked questions about how the state is going to fund $125 million a year in incentives for low-income communities and environmental justice communities.,

Assemblywoman Nancy Pinkin, the Democratic chairwoman of the Assembly Environment and Solid Waste Committee, admitted the $125 million-per-year allocation caused her to pause when she first heard it.

“Sometimes, it is just a matter of allocating resources,’’ she said.

Fiordaliso said the board always looks at expenditures and whether they would be prudent to ask ratepayers to pay for them. “The concept is fantastic,’’ he said, but the agency must determine whether the costs are affordable.