Democratization Of Solar Power Refutes Net Metering Critics

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Written by Nora Caley
on February 19, 2014 No Comments
Categories : E-Features

Rooftop solar is a middle-class phenomenon, and that could help solar advocates win the net-energy metering debate. That's according to a study by the Washington, D.C.-based Center for American Progress (CAP), which recently released a report, ‘Solar Power to the People: The Rise of Rooftop Solar Among the Middle Class.’

The concept of inexpensive solar for middle-class homeowners is important not just for advocates for clean energy. The ‘solar revolution,’ as the report calls it, could also play a role in the net metering fights occurring in certain markets.

Study author Mari Hernandez, a research associate on the CAP's energy team, says she was surprised to find that the overwhelming majority of solar customers were in the middle class.

‘With solar panel costs falling so dramatically over the last several years, I figured that rooftop solar had to be reaching more than just the wealthy,’ she says. ‘I wasn't sure what I would find, though, given how different California, Arizona and New Jersey are with respect to income distribution and energy policies.’
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The study indicated that in Arizona, California and New Jersey, most of the rooftop installations were in neighborhoods where homeowners earned median incomes of $40,000 to $90,000.

The team collected solar installation data from Arizona Public Service (APS), the California Solar Initiative (CSI) and New Jersey's Clean Energy Program (NJCEP). The databases from the three entities contain information on installations for which customers have applied for solar incentives, such as rebates or renewable energy certificates. The researchers took the ZIP codes in the databases and found the median household income information from the U.S. Census Bureau's 2011 American Community Survey.

Hernandez says Arizona was the most surprising, with nearly 80% of the solar installations on homes located in ZIP codes where the median incomes ranged from $40,000 to $89,999. In New Jersey, nearly 64% of homes with solar were in the middle-income ZIP codes, and in California, the number was 67%.

The study also found that the percentage of solar on middle-class homes has increased steadily from 2009 to 2012. Meanwhile, the share of high-income homes with solar decreased over that time period.

In Arizona, in 2009, slightly more than 19% of residential solar was installed on homes of people with median incomes of more than $90,000. By 2013, that percentage had dropped to just under 11%. In California, 31% of homes with solar had homeowners with median incomes above $90,000 in 2009, and by 2013, that figure decreased to less than 26%. In New Jersey, that figure went from approximately 43% to 25% over that time period.

Meanwhile, much of the growth – especially from 2011 to 2012 – was in the lower end of the $40,000 to $90,000 income range. The neighborhoods that experienced the most growth had median incomes of $40,000 to $50,000 in both Arizona and California, and $30,000 to $40,000 in New Jersey.

The findings have important implications for the net metering debate, the report noted. Some utilities have sought to decrease the amount of reimbursement to customers who feed solar-generated electricity back onto the grid. Part of the utilities' argument, according to the CAP report, is that ‘they are concerned that only wealthy customers are adopting rooftop solar, meaning that customers who cannot afford to go solar are subsidizing the rich through the utility's solar policies.’

But according to the report, now the non-rich can afford to go solar. The early adoption phase, in which only wealthy customers installed rooftop solar, has ended.

‘I think many solar advocates were pleased to see that rooftop solar is reaching middle-class homeowners, not only because that means that more clean energy is being installed, but also because that goes against the utility industry's claim that solar technology is only being adopted by the wealthy,’ Hernandez says.

Hernandez plans to write a follow-up report, analyzing solar installation data from other states.

The ‘Power to the People’ report is available here.

Nora Caley is a freelance writer based in Denver.

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