Alternative Energy Sources Inaccessible to Many Low Income Canadians

by | Apr 11, 2018 | Education, Energy Efficiency

Solar panel prices have seen a sustained drop – more than 70 percent since 2009 – but it costs approximately $22,500 or more to have a solar array installed, or $3.01 per watt produced. This expense puts one of the most popular alternative energy sources out of reach for low income Americans, who would most benefit from the long-term savings.

Single family homeowners are using their roof space to install relatively inexpensive solar panels, but many low-income Canadian live in either apartment or rental properties and don’t have permission to install the panels.

Consumers Benefit from Alternative Energy Sources

A small-scale, on-site power source, or distributed generation system, has seen a dramatic increase in interest and implementation, especially in the solar energy field, increasing globally by 50 percent in 2016. Consumers using distributed generation systems connect to the electrical grid for power when their solar panels aren’t producing enough energy to meet their needs, and to sell energy back to the utility when their systems produce excess energy. Energy net metering, or the process of selling excess energy back to a utility, could result in even further utility cost reductions for low-income Canadians.

The cost per watt has come dropped by about 90% over the last decade, but the upfront costs are still not affordable for low-income Canadians.

Industry Aid

Other groups are working to make alternative energy sources, such as solar energy, accessible to low-income Canadians through group discount programs, leasing and community solar gardens.

Some organizations are stepping up to help marginalized residents achieve energy efficiencyand reinvesting them in clean energy, such as Groundswell, a 501c3 nonprofit that, “builds community power through equitable community solar projects and resilience centers, clean energy programs that reduce energy burdens, and pioneering research initiatives that help light the way to clean energy futures for all.” Groundswell works with more than 5,500 income-qualified customers to save more than $2.75 million in annual savings.

Solutions that Fit

Solar gardens are a community-owned solar array using energy net metering, and are an alternative to installing panels for those who are low-income or who live in a heavily shaded area. Solar gardens pool the costs and the benefits, making it an attractive option for those who can afford to buy-in or “subscribe.” The upfront costs can be raised through crowd funding or through a third-party financier power purchase agreement.

Solar gardens require a lot of groundwork, however, and cooperation between communities, legislators and utilities. A garden manager should be designated to oversee the sale of shares and the operation and maintenance of the solar garden, in addition to the upfront costs.  A utility can also handle this responsibility if a community partners with a utility.

Leasing Options

Leasing solar panels is another solution for marginalized residents. Generally, a solar panel lease works like any other. A homeowner agrees to lease the panels for a period, usually between 10 and 20 years, and to purchase energy from the leasing company. There may be a down payment, and the leasing company is responsible for the care and maintenance of the system.

However, those who lease their solar panels usually miss out on federal tax credits and state incentives for those installing their own panels, as well as the the need to involve the solar panel company in potential sales of the property. If a homeowner sells their home, they must either transfer the lease to the new owners or pay to terminate the contract.

Safe Infrastructure

Another important factor in ensuring low-cost, safe energy in low-income households is up-to-code electrical wiring in good repair.  While there are programs such as the Ontario Energy Board’s Ontario Electricity Support Program (OESP), such programs have income, age or area eligibility requirements. Many citizens lack the savings for an emergency repair, according to HomeServe’s Biannual State of the Home Survey Summer 2017 edition. Nearly 30 percent of those surveyed didn’t have any money set aside for an emergency – and not all of those will qualify for repair assistance programs.

HomeServe offers low-cost warranty programs for interior and exterior electric lines as well as other systems in the home. HomeServe utility partners may qualify for royalties that can be applied to low-income assistance or renewable energy programs.