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Operated by the Alliance for Sustainable Energy, LLC

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Laboratory (NREL) at www.nrel.gov/publications.

Contract No. DE-AC36-08GO28308

Technical Report

NREL/TP-6A20-71652 

December 2018

Design and Implementation of 

Community Solar Programs for Lowand Moderate-Income Customers

Jenny Heeter, Lori Bird, Eric O'Shaughnessy, 

and Sam Koebrich

National Renewable Energy Laboratory
NREL is a national laboratory of the U.S. Department of Energy

Office of Energy Efficiency & Renewable Energy

Operated by the Alliance for Sustainable Energy, LLC

This report is available at no cost from the National Renewable Energy

Laboratory (NREL) at www.nrel.gov/publications.

Contract No. DE-AC36-08GO28308

Technical Report

NREL/TP-6A20-71652 

December 2018

National Renewable Energy Laboratory

15013 Denver West Parkway

Golden, CO 80401

303-275-3000 • www.nrel.gov

Design and Implementation of 

Community Solar Programs for Lowand Moderate-Income Customers

Jenny Heeter, Lori Bird, Eric O'Shaughnessy, 

and Sam Koebrich

National Renewable Energy Laboratory

Suggested Citation

Heeter, Jenny, Lori Bird, Eric O'Shaughnessy, and Sam Koebrich. 2018. Design and 

Implementation of Community Solar Programs for Low- and Moderate-Income Customers. 

Golden, CO: National Renewable Energy Laboratory. NREL/TP-6A20- 71652. 

https://www.nrel.gov/docs/fy19osti/71652.pdf.
NOTICE

This work was authored by the National Renewable Energy Laboratory, operated by Alliance for Sustainable 

Energy, LLC, for the U.S. Department of Energy (DOE) under Contract No. DE-AC36-08GO28308. Funding 

provided by the U.S. Department of Energy Office of Energy Efficiency and Renewable Energy Solar Energy 

Technologies Office. The views expressed in the article do not necessarily represent the views of the DOE or the 

U.S. Government. The U.S. Government retains and the publisher, by accepting the article for publication, 

acknowledges that the U.S. Government retains a nonexclusive, paid-up, irrevocable, worldwide license to publish 

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iv

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Acknowledgments

The authors would like to thank the following individuals for their insights about low- and 

moderate-income community solar programs: 

• Shauna Beland, Rhode Island Office of Energy Resources

• Adrienne Dorsey, GRID Alternatives

• Tom Figel, GRID Alternatives

• Beth Galante, PosiGen

• Brian Granahan, Illinois Power Agency

• Isabelle Hazlewood and Kerry O’Neill, Connecticut Green Bank

• Tom Hunt, Clean Energy Collective

• David Parsons and Matt McDonnell, Hawaii Public Utilities Commission

• Zachary Sippel, Energy Trust of Oregon

• Daniel White and Edward Yim, Washington, D.C. Department of Energy 

& Environment.

The authors would also like to thank Kristen Ardani, Jaquelin Cochran, Jeff Cook, and Monisha 

Shah of the National Renewable Energy Laboratory (NREL), Warren Leon and Diana Chace of 

the Clean Energy States Alliance, and Shubha Jaishankar of the Department of Energy Solar 

Energy Technologies Office for their review. 

The report was prepared by NREL for the Clean Energy States Alliance and funded by the US 

Department of Energy Solar Energy Technologies Office, under TSA-16-891, State Strategies to 

Bring Solar to Low- and Moderate-Income Communities.
v

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Table of Contents

1 Introduction........................................................................................................................................... 1

2 Existing and Emerging State LMI Community Solar Programs....................................................... 2

3 Program Design and Structure ........................................................................................................... 5

3.1 What is the Optimal Customer Participant Mix? .......................................................................... 5

Option 1: LMI carve-out ............................................................................................................... 5

Option 2: LMI-only project or program........................................................................................ 5

Option 3: Anchor tenant................................................................................................................ 7

Option 4: LMI participation incentives......................................................................................... 7

3.2 How are LMI Customers Billed and Credited for their Subscriptions? ........................................ 7

Option 1: Utility billing and crediting........................................................................................... 7

Option 2: Payment to third party and credit on utility bill ............................................................ 8

Option 3: Payment and crediting through building owner/aggregator of LMI subscribers .......... 8

3.3 Who is Responsible for LMI Customer Acquisition and Retention?............................................ 9

Option 1: The utility is responsible for LMI customer acquisition and retention. ........................ 9

Option 2: A third-party community solar developer responsible for LMI customer acquisition 

and retention..................................................................................................................... 9

Option 3: Affordable housing facilities serve as subscribers on behalf of their tenants. ............ 10

3.4 How is Customer Eligibility Defined and Verified? ................................................................... 10

3.5 How Can Program Design Reduce Customer Turnover and Default Risk?................................ 11

Option 1: Prepaid subscriptions .................................................................................................. 12

Option 2: Housing authority manages subscriptions................................................................... 12

Option 3: Bundling energy assistance funds............................................................................... 12

Option 4: Subscribers with flexible subscriptions....................................................................... 13

Option 5: Workplace subscription programs............................................................................... 13

Option 6: Incentives for maintaining fully subscribed arrays..................................................... 14

Option 7: Shorter contracts.......................................................................................................... 14

3.6 What are Strategies for Enrolling Customers with Low Credit Scores? ..................................... 14

Option 1: Loan loss reserve mechanisms.................................................................................... 15

Option 2: Alternative underwriting criteria................................................................................. 15

3.7 Where Should Community Solar Projects be Sited?................................................................... 15

Option 1: Location within utility service area............................................................................. 16

Option 2: LMI neighborhood ...................................................................................................... 16

Option 3: Brownfields................................................................................................................. 16

Option 4. Locations with utility grid benefits ............................................................................. 17

Option 5: Public or donated land................................................................................................. 17

Option 6: Rooftop (e.g., affordable housing and mixed-income housing).................................. 17

4 Incentives and Financing................................................................................................................... 19

4.1 How Much Financial Incentive Do LMI Customers Need to Participate in Community Solar? 19

4.2 What Financing Strategies Exist to Help Cover Up-Front Cost?................................................ 21

Option 1: On-bill financing......................................................................................................... 22

Option 2: Lower interest rates loan ............................................................................................. 23

4.3 How Can Existing LMI Programs be Leveraged to Incentivize Community

Solar Participation? ..................................................................................................................... 23

Option 1: Utility low-income bill subsidies................................................................................ 24

Option 2: Federal Weatherization Assistance Program (WAP).................................................. 24

Option 3: Federal Low Income Home Energy Assistance Program (LIHEAP).......................... 25

4.4 What Other Incentives Help Developers Offer More Favorable Rates to LMI Customers?....... 26

Option 1: Community Reinvestment Act investments................................................................ 26

Option 2: New Markets Tax Credit (NMTC).............................................................................. 26
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Option 3: Grant funding .............................................................................................................. 27

Option 4: Incentive multipliers or customer acquisition subsidies ............................................. 27

5 Customer Outreach ............................................................................................................................ 28

5.1 How to Reach Eligible LMI Customers and Potentially Target Specific Customer Types?....... 28

5.2 What Are Effective Partnerships for LMI Customer Outreach? ................................................. 29

5.3 What Are Effective Messaging Strategies to Reach LMI Customers? ....................................... 31

5.4 What Are Effective Communications Vehicles?......................................................................... 32

6 Summary ............................................................................................................................................. 33

References................................................................................................................................................. 34

Appendix.................................................................................................................................................... 39

Overview of Existing Programs—Information Current as of May 2018 ............................................. 39

List of Community Solar Developers................................................................................................... 44

List of Figures

Figure 1. States with a community solar program with an LMI component ................................................ 2

Figure 2. Considerations for LMI participation in community solar.......................................................... 22

Figure 3. Trusted sources of information for community solar programs among low-income

potential customers ................................................................................................................ 30

Figure 4. Most compelling messaging for LMI customers based on survey data....................................... 31

Figure 5. Most effective messaging channels for LMI community solar customers.................................. 32

List of Tables

Table 1. Summary of Existing LMI Community Solar Programs................................................................ 3

Table 2. Washington, D.C. Solar for All Innovation and Expansion Grant Projects Funded

FY17–FY18 ........................................................................................................................... 18

Table 3. Variations in Community Solar Pricing and Product Structures .................................................. 20

Table 4. Options for Using Community Solar to Reduce Electricity Burden............................................. 21

Table 5. Hard-to-Reach Low-Income Customers....................................................................................... 28

Table 6. Partnerships for LMI Customer Outreach..................................................................................... 30

List of Text Boxes

Text Box 1. Case Study: Colorado LMI Community Solar Programs................................................... 6

Text Box 2. Washington, D.C.’s Solar for All Program ...................................................................... 18

Text Box 3. On-Bill Financing Options through Utility-Owned LMI Community Solar.................... 23
1

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1 Introduction

Community solar has emerged as a potential model to increase low- and moderate-income (LMI)

solar access and reduce LMI energy burden (Gagne and Aznar 2018). In a community solar 

program, a utility or third-party owns a utility-scale PV array and sells portions of the array’s 

power (kilowatts or kW) or generation (kilowatt-hours or kWh) to multiple subscribers. These 

subscribers pay voluntarily for their portion of the array and then receive a credit on their 

electricity bill for their share of production. This bill credit for generation produced may also 

include payment for the associated renewable energy certificates (RECs), depending on program 

structure. Subscribers can pay for their share through either an up-front payment or an ongoing 

monthly payment, such as through a financing option. SEPA (2015a) reported that 73% of active 

community solar programs in 2015 had an up-front payment, 17% had an ongoing payment, and 

10% allowed subscribers to choose the option they preferred. Subscribers could also take out a 

private loan to pay an up-front payment. 

Ensuring LMI participation in community solar can be challenging. As states and utilities seek to 

increase LMI community solar, they are looking for program and policy designs to facilitate LMI

participation. Subscription models may need to be adjusted from the standard community solar 

offer. Programs may need to provide subsidies to LMI community solar subscribers to remove 

barriers related to up-front costs and to ensure the product provides immediate savings. Finally, 

those in charge of subscribing LMI community solar may need to find ways to work with LMI 

stakeholder groups to reach LMI customers. 

This report draws from the literature and from interviews with representatives from LMI solar

developers and state LMI community solar programs to provide experience on LMI community 

solar design. We interviewed stakeholders involved with LMI community solar in an informal 

manner, to gain insight into their key successes and barriers. The report is structured as follows. 

In Section 2, we review existing and emerging LMI community solar programs, with additional 

program detail provided in the appendix. In Section 3 we discuss key questions related to 

program design. Section 4 outlines how states can leverage incentives and finance structures to 

lower the cost of LMI community solar. Section 5 examines marketing and outreach 

considerations for LMI community solar. 
2

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2 Existing and Emerging State LMI Community 

Solar Programs 

States and utilities are rapidly adopting and developing LMI community solar policies and 

programs. Colorado, Connecticut, Hawaii, Maryland, and Oregon have all mandated community 

solar with a certain percentage (carve-out) of LMI customers; other states have provided 

incentives for LMI community solar (Colorado, Illinois, Massachusetts, Rhode Island, and 

Washington, D.C.); some states are in the process of developing programs (Connecticut, 

Minnesota, New York, New Jersey). Figure 1 and Table 1 summarize community solar programs 

with an LMI component. The appendix provides details on these programs.1

Figure 1. States with a community solar program with an LMI component

Information current as of May 2018

 1 See www.lowincomesolar.org for updates to low income community solar programs.
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Table 1. Summary of Existing LMI Community Solar Programs

Information current as of May 2018

State Program Program Status 

(Launch Date) Program Structure

California Multifamily 

Affordable Solar Housing

Closed to new 

applicants (2015)

Incentives for solar systems on 

multifamily housing

Colorado Community Solar 

Gardens Act Active (2011) Specified LMI participation levels: 5% of 

each project designated through rulemaking

Colorado Low-Income 

Community Shared Solar 

Demonstration Projects

Closed (2015) Incentives for 1.5 MW of dedicated LMI 

community solar arrays 

Colorado Xcel Energy 

Settlement Launched (2017)

13.5 megawatts (MW) of RFPs for new LMI 

community solar systems, Xcel Energy 

assuming 5% carveout through new program 

(under development)

Connecticut Shared Clean 

Energy Facility Pilot Program Active (2017)

5.2 MW across three projects, with 20% LMI 

participation in each; Senate Bill 9 (2018) made 

the Shared Clean Energy Facility program 

permanent, allowing up to 25 MW of projects per 

year, with 10% of capacity towards low-income

subscribers, 10% to LMI or low-income service 

organizations

District of Columbia Solar 

for All Active (2016)

Program required to reduce electricity bills of at 

least 100,000 low-income households by at least 

50% (community solar is one piece of this 

program); incentives for demonstration projects

Hawaii Community-Based 

Renewable Energy

In development 

(2015)

Specified LMI participation levels: 50% for 9 MW 

of utility-led projects

Illinois Community 

Renewable Generation 

Program

In development 

(2016)

Incentives to LMI customers or developers: 

37.5% of Solar for All funds will subsidize LMI 

customer for community solar participation; 

22.5% of funds will go to LMI community solar 

pilot projects

Maryland Community Solar 

Energy Generating Systems 

Pilot Program

Pilot (2017)

Specified LMI participation levels: 60-MW carveout for projects where LMI customers own 20% 

of output; additional 60-MW carve-out for “small” 

projects, including projects with more than 50% 

LMI participation

Massachusetts Virtual Net 

Metering

Phasing out 

(2017)

Incentives to LMI customers: LMI customers are 

eligible for low-interest financing from the Mass 

Solar Loan program
4

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State Program Program Status 

(Launch Date) Program Structure

Solar Massachusetts 

Renewable Target (SMART)

In development 

(2017)

1,600-MW declining block net-metering 

program. Community solar serving at least 50% 

low-income customers receives an added 6 

cents/kWh; low income community solar projects 

less than 25 kW will receive 230% of the base 

compensation rate

Minnesota Community Solar 

Gardens Active (2014)

Utilities are required by commission to submit 

plans for LMI projects. Xcel’s pilot proposal 

involves a 0.5-MW–1.0-MW system providing 

free subscriptions to low-income customers 

New Jersey Community Solar 

Energy Pilot Program (Senate 

Bill 877)

In development 

(2018)

Senate Bill 877 directs the Board of Public 

Utilities to develop a community solar pilot 

program; the program must “provide access” to 

LMI customers 

NYSERDA Low Income 

Community Solar Initiative

In development 

(2017)

NYSERDA is tasked with introducing an initiative 

to provide financial support for pilot projects, 

streamline pre-development assistance, and 

develop LMI credit and support mechanisms 

such as a loan loss reserve

Oregon Community Solar Active (2016) Specified LMI participation level of 10%; rules 

under development

Rhode Island Community 

Remote Net Metering Active (2016)

Incentives to LMI developers: $200/LMI

subscriber bonus to developer that is passed on 

to LMI subscribers
5

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3 Program Design and Structure

Different program structures have been used or are under consideration to promote LMI 

customer participation in community solar programs. In some cases, program design and 

structure are specified in legislation, however, in many cases, these details are developed as part 

of a public utilities commission stakeholder process. This section explores key aspects of 

program structure and implementation related to customer eligibility, subscription management, 

options for addressing low credit scores, bill crediting, and project siting. For each option 

addressed, we provide a table of advantages and disadvantages. These advantages and 

disadvantages pertain to that option and may be perceived differently among different 

stakeholders; where that is the case, we have noted that in the table.

3.1 What is the Optimal Customer Participant Mix?

The choice of customer mix involves tradeoffs around risk, financing cost, and ease of 

implementation. In general, projects with higher percentages of LMI customers are costlier to 

implement because of higher customer acquisition costs, the need for eligibility verification, and 

increased project financing costs. Developing a mix of LMI and non-LMI residential customers 

in the subscriber portfolio may reduce program costs; however, it may also increase complexity 

in terms of obtaining different types of subscribers. There are several possible approaches to 

developing the subscriber portfolio, discussed below. Some of these options could be 

implemented together, e.g. an LMI carve-out (Option 1) with a large anchor tenant (Option 3).

Option 1: LMI carve-out

The program can reserve a fraction of the project’s capacity or generation for LMI customers and 

allow non-LMI customers to subscribe to the remaining share. For example, states have 

developed requirements for 5-20% LMI participation, or higher. The non-LMI customers may 

bear some of the additional costs of the LMI customer portion, or the state may provide 

incentives to defray these additional costs. The carve-out could be implemented across a 

portfolio of community solar projects or apply to each project. 

Advantages Disadvantages

• Carve-outs ensure a minimum level of LMI 

participation.

• Non-LMI customers can also participate, which 

can keep costs lower for LMI customers.

• A wide range of customers are eligible (e.g.,

commercial).

• A broader mix of customers could reduce 

default risk.

• Maintaining LMI participation at a set level adds 

LMI customer acquisition costs to address 

turnover.

• Prescribing a minimum LMI requirement may 

serve as an artificial limit on LMI subscribers, 

as developers seek to only serve up to the 

minimum requirement.

• Non-LMI customers may bear some costs of 

LMI customer participation. 

Option 2: LMI-only project or program

Community solar programs or projects can be designed and implemented exclusively for LMI 

customers. These projects have typically been deployed in a programmatic approach, for 

example, to reduce LMI energy burden. In this scenario, the array would be 100% subscribed by 

LMI customers. Text Box 1 describes the Colorado experience with carve-outs and dedicated 

LMI projects. 
6

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Advantages Disadvantages

• It is easier to link to other LMI programs and 

offer specific incentives to LMI customers.

• Marketing materials can be designed 

exclusively toward LMI customers.

• It serves more LMI customer through a single 

community solar project. 

• Making the project financially viable for both the 

developer and the LMI participants can be more 

challenging, as LMI customers will have to 

support all project costs, instead of costs being 

spread among non-LMI and/or anchor tenants.

• Other customer classes may also want access 

to community solar.

• Third-party developers may see higher financial 

risk 

Text Box 1. Case Study: Colorado LMI Community Solar Programs

The Colorado Community Solar Gardens Act (2010) established requirements for investor-owned 

utilities to offer community solar programs. The Act required the state’s investor-owned utilities to 

propose ways to increase LMI subscriptions. The resulting public utility commission rulemaking set 

the requirement that investor-owned utilities reserve 5% of each community solar project’s capacity 

for LMI customers. Project developers partnered with non-profits and public housing authorities to 

meet and maintain compliance with the LMI carve-out. 

In 2015, the Colorado Energy Office commissioned a study of the LMI carve-out (Lotus Engineering 

and Sustainability 2015). Developers reported that the per-project carve-out was an inefficient way to 

increase LMI subscriptions, since project developers needed to invest resources to meet and 

maintain the carve-out for each project, instead of being able to manage the carve-out on a portfoliowide basis. Furthermore, because of the challenges associated with LMI customer acquisition, the 

study found that project developers met the LMI carve-out by giving away free subscriptions to LMI 

customers. Developers reported that higher project costs and lower project revenues meant higher 

prices for non-LMI customers.

To address the challenges of the 5% carve-out, stakeholders, including developers and advocates,

suggested moving to a portfolio-based rather than project-based LMI target. A portfolio-based 

approach allows developers to increase LMI subscriptions by providing dedicated LMI community 

solar projects which offer incentives for low-income projects, including consideration of additional 

benefits to customers (bill savings, coordination with energy efficiency, job training opportunities). In 

2016, the Colorado Public Utilities Commission approved the new portfolio-based LMI solar target. 

The policy requires Xcel Energy to provide LMI customers with access to 4 MW per year of 

community solar capacity from 2017 to 2019. The new program also provides incentives for an 

additional 0.5 MW of projects annually dedicated exclusively to LMI customers.

Colorado’s rural electric cooperatives (coops) and municipal utilities (munis) are exempt from the 

state’s Solar Gardens Act. However, several coops and munis have implemented community solar 

programs with LMI components. In 2015, the Colorado Energy Office awarded a $1.2 million grant to 

support coop and muni demonstration projects of LMI community solar (Colorado Energy Office 

2017). Eligible projects were required to be dedicated exclusively to LMI customers and use different 

program structures to reduce energy burden for low-income customers. GRID Alternatives (the 

grantee) partnered with coops and munis to implement 8 demonstration pilot projects, totaling over 

1.5 MW of capacity, serving over 380 low-income customers.
7

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Option 3: Anchor tenant

Project developers can seek a single creditworthy non-residential anchor tenant to subscribe 

to a large portion of the project’s capacity. For instance, the framework proposed by the Hawaii 

Public Utilities Commission allows a single anchor tenant to be any size up to 60% of a project’s 

capacity. 

Advantages Disadvantages

• It can improve project economics and help 

developers obtain financing by reducing the risk 

associated with customer subscriptions.

• Flexible anchor tenant agreements could 

mitigate customer turnover risk.

• Anchor tenants may be able to provide land or 

rooftop space for the community solar array.

• Allowing anchor tenants could reduce the 

number of LMI subscribers per array.

• Anchor tenant assumes more risk.

Option 4: LMI participation incentives

Some states and programs are developing added incentives for LMI community solar 

subscribers. For example, if the state already has a solar renewable energy certificate (SREC) 

program, it may decide to award LMI community solar projects or subscribers a higher SREC 

rate. The incentive could be structured so that a community solar project would receive a higher 

SREC rate, for example, if half of the subscribers are LMI. 

Advantages Disadvantages

• Does not provide a cap (real or artificial) on LMI 

subscribers.

• Builds on existing incentive program structure.

• LMI participation is not guaranteed.

• It may be difficult to set an incentive at an 

appropriate level; setting it too high would result 

in over-spending while setting it too low would 

result in low or no LMI participation.

3.2 How are LMI Customers Billed and Credited for their 

Subscriptions?

LMI customer billing and crediting arrangements depend in part on whether the customer has an 

individual meter or lives in a master-metered building. Another issue is whether payment for the 

community solar project is processed through the utility or made to a third party. The primary 

options are below. 

Option 1: Utility billing and crediting

LMI community solar customer billing and crediting often occurs on the customer’s existing 

utility bill. LMI customers in Colorado Energy Office demonstration projects, which are owned 

by utilities, contribute an on-bill payment and see a net utility bill line item deduction of around 

$0.04/kWh after accounting for payments and credits. Though the utility assumes the risk of nonrepayment, utilities are arguably in a good position to understand which customers are most 

likely to pay their electricity bills. This could enable utilities to subscribe LMI customers with no 

or poor credit ratings who have good bill payment history, as discussed in Section 3.5. 
8

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Advantages Disadvantages

• This option is the simplest for subscribers, who 

pay a single bill.

• It may result in higher repayment by 

subscribers.

• It reduces risk for the project developer.

• Customers may be able to see the net benefit

more clearly.

• It may require utility billing software 

improvements.

• The utility assumes the risk of non-repayment, 

though non-repayments could be covered by 

existing LMI energy programs.

Option 2: Payment to third party and credit on utility bill

Alternatively, LMI customers can pay developers directly for their share of the community solar 

project through a separate billing mechanism, with the bill credit applied through the utility. In a 

program model in Connecticut, customers make monthly payments of $8 directly to the 

developer and receive monthly bill credits of $10 on their utility bill. Payments to developers can 

be facilitated via Automated Clearing House (ACH) transactions, so that customers do not need 

to write a check each month. 

Advantages Disadvantages

• Utility doesn’t assume risk of repayment for 

project developed by third-party.

• Third-parties can offer a discount for 

subscribers who pay using an Automated 

Clearing House (ACH) transaction, since ACH 

transactions can reduce the risk of 

nonpayment. 

• Third-party assumes the risk of non-repayment, 

potentially increasing the cost of project 

finance.

• Subscribers would prefer only one bill.

• The risk of nonrepayment may be higher.

• The net benefit (bill savings) may not be as 

clear to subscribers.

Option 3: Payment and crediting through building owner/aggregator of 

LMI subscribers

LMI customers in master-metered buildings generally cannot be billed and credited directly for 

community solar subscriptions. In this context, the building owner, such as a multifamily 

affordable housing unit, may serve as the subscriber on behalf of its tenants. Direct bill crediting 

may be possible where the tenants have individual meters and where state policy allows. Under 

the California Multifamily Affordable Solar Housing program, customers are credited on their 

electricity bills through virtual net metering (EPA 2017). This structure requires that tenants pay 

their own electricity bills (i.e. the building is not master-metered). In Rhode Island, direct bill 

crediting is not required, but policy requires building owners to provide tenants with “tangible 

benefits” such as free Wi-Fi or improvements to common spaces. 

Advantages Disadvantages

• It creates an on-bill credit, like Option 1. • The ability to share credits with tenants can be 

complicated in HUD housing, where customers 

pay a fixed 30% of income for rent and utilities. 

• This option is restricted to states that allow this 

metering arrangement.
9

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3.3 Who is Responsible for LMI Customer Acquisition and Retention?

Depending on how programs are structured, utilities and third-parties may have different roles 

to play. Where utilities own the community solar arrays, they may play a larger role in customer 

acquisition and retention. Where community solar is owned by a third-party, the third party may 

have primary responsibility for subscription management. Another option is for an affordable 

housing authority or non-profit organization to assist. 

Option 1: The utility is responsible for LMI customer acquisition and retention.

The advantage of this approach is that the utility can use its existing LMI energy program lists to 

generate leads for LMI community solar programs. It is possible that a utility could see a lower 

installed cost for the solar array, e.g. through their knowledge of best places for interconnection. 

Utilities can also work with affordable housing programs, existing LMI energy programs, and 

other LMI-focused groups to improve customer acquisition and retention. 

Advantages Disadvantages

• Utilities may have access to lists of customers 

who already participate in energy assistance 

programs.

• Utilities can verify eligibility based on existing 

programs.

• Utilities are a known and potentially trusted 

entity.

• Utilities may be able to leverage other outreach 

efforts and programs to promote the solar

option

• If the utility does not own the array, it may not 

be incentivized to keep it subscribed.

• The utility may not have expertise marketing to 

LMI customers.

Option 2: A third-party community solar developer responsible for LMI customer 

acquisition and retention.

Under this approach, third-party community solar developers are responsible for meeting either 

a mandate or an incentive for LMI participation.2 For example, under Colorado’s Community 

Solar Gardens Act, the Colorado Public Utilities Commission mandated that community solar 

developers subscribe each community solar array with 5% LMI customers (Text Box 1).

Advantages Disadvantages

• If the third party is receiving incentives for LMI 

subscribers, they will be motivated to ensure 

LMI participation.

• Third party developers are often used to 

partnering on customer acquisition and have 

found ways to partner in the LMI space.

• Third-party developers new to subscribing LMI 

customers may not have sufficient connections 

to LMI communities or organizations.

• Third-party developers may not have sufficient 

resources for sustained outreach and/or access 

to utility customer data on eligible customers.

 2 In some cases, other third-party organizations, such as community action agencies, may have lists of low-income 

eligible subscribers. In those cases, those agencies may be able to recruit subscribers at lower cost than organizations 

with no access to such lists. 
10

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Option 3: Affordable housing facilities serve as subscribers on behalf of 

their tenants.

Under this approach, an affordable housing facility could host a community solar array and 

facilitate tenant subscriptions or pass-through of other benefits (e.g. building upgrades), if direct 

subscription were not an option (i.e., if the building were master-metered). The Denver Housing 

Authority is developing a community solar project and also acting as a subscriber, partnering 

with Grid Alternatives, Namaste Solar, and others, under Xcel’s community solar program

(SEIA 2018). 

Advantages Disadvantages

• Affordable housing facilities have direct access

to LMI customers and may be able to easily 

enroll their tenants.

• Affordable housing facilities may be able to 

enroll new tenants as people move in and out 

of their facilities.

• Affordable housing facilities can be trusted 

entities and known to their customers.

• Affordable housing, depending on its ownership 

structure, may be able to access low income 

housing tax credits for an on-site solar project. 

• Affordable housing facilities, especially small 

ones, may lack the staff capabilities to assist 

with subscription management.

• Master-metered buildings may make it 

impossible to pass subscription benefits directly 

to individual tenants.

• Utility community solar programs and/or state 

net metering laws may prohibit this structure.

• Tenants may not see any net savings, if their 

housing payment increases due to a decrease 

in utility expenses. 

3.4 How is Customer Eligibility Defined and Verified? 

Customer eligibility criteria can influence the ability to easily target customers and to verify 

their eligibility for participation in the program. Existing programs have used various methods 

for defining eligibility:

• Income qualified. Most programs use some type of income-based criterion. For example, 

the Maryland program defines LMI customers as those below 175% of the federal 

poverty line. 

• Location qualified. For example, customers residing in environmental justice 

communities may be deemed program-eligible.

• Participation in an existing program. Another method is to make program eligibility 

consistent with pre-existing LMI energy programs, which can aid in the targeting and 

verification process. For example, several programs allow customers participating in state 

Low Income Home Energy Assistance Program (LIHEAP) programs to participate in 

LMI community solar programs, by default. 

• Participation by LMI housing and service organizations. In some states, such as 

Colorado, Connecticut, Maryland, and Rhode Island, affordable housing operators can 

qualify as LMI participants. 

Verification of eligibility is another important aspect of program implementation. One 

consideration is who will conduct the verification. Is it the utility, the developer, or a third party? 

Utilities may have data on customer income, bill payment history, and participation in bill 
11

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assistance or other LMI programs. However, they may be unable to share this information 

because of data privacy concerns. 

Third-party consultants can assist with verification while protecting the confidentiality of 

customer information, but the cost of using a third party would need to be covered under the 

program. The Massachusetts Clean Energy Center, which administers the Massachusetts Solar 

Loan Program, uses a third-party income verifier. Applicants fill out an online application. The 

income verifier uses this information to submit a request to the IRS for a tax transcript. Then, the 

income verifier compares the applicant’s income against the program’s income thresholds and 

provides an eligibility letter. 

Perhaps the easiest method of verification is an option to link eligibility with other LMI 

programs, such as LIHEAP assistance, where participation can be readily verified. Under this 

and other verification structures, programs may want to consider the need for verification over 

time to ensure the program is meeting its LMI participation targets, if minimum thresholds exist. 

Finally, the verification process will depend on the structure of the program. For example, for

projects on LMI housing developments, the Massachusetts Department of Energy Resources 

verified the eligibility of the housing authority, not of the individual tenants; that piece was done 

by the housing authority. Housing developments had to have at least 25% of units serving 80% 

area median income (AMI) or 20% of units serving 50% AMI. For more information on 

customer eligibility criteria and income verification, see Clean Energy States Alliance (2017). 

3.5 How Can Program Design Reduce Customer Turnover and 

Default Risk?

LMI customer retention is a significant issue for community solar projects, and the cost of 

acquiring new customers and replacing those that leave the program can be significant. One 

interviewee noted that LMI customer outreach is about subscription management, not just 

customer acquisition.3

Solar developers typically specialize in up-front customer acquisition but are unaccustomed 

to ongoing subscription management. For this reason, effective subscription management may 

require a partnership with a utility or community organization with an ongoing relationship with 

potential subscribers.

Furthermore, there can be significant turnover among LMI customers, particularly in renter

populations. Customers need to be replaced when others move. Therefore, LMI customer 

acquisition is an ongoing process. Existing programs in Colorado have experienced high 

turnover among LMI customers, even where participation in the program comes at no cost to the 

subscriber. One community solar developer reported that a substantial number of customers 

ceased participation in the program after the first year, and that these customers were often

 3 Related to customer turnover is the issue of subscriber termination fees and process. From an LMI participant 

perspective, programs need to be designed with termination fees and processes that will not harm their credit rating. 

Programs that allow a subscriber to retain their subscription if they move within the utility service territory can 

reduce the need for LMI customers to terminate their subscription. 
12

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

renters. This has required the developer to maintain a long waiting list to be able to maintain the 

required level of LMI customer participation.

There are many ways to address customer turnover, depending on who is responsible for 

customer retention as well as how products are structured. Options to address customer turnover 

include the following seven options.

Option 1: Prepaid subscriptions

Prepaid subscriptions would use external funding for an up-front payment of the subscription. 

This funding could be provided via state funds, grants, or other options.4 In a prepaid 

subscription, the LMI subscribers, using external funding sources, would be subscribed for set 

time (e.g. 15 years) and receive credits on their electricity bills for that duration. If the entire 

LMI subscription could not be prepaid, policies could at a minimum allow for some mix of payas-you-go and prepaid subscriptions to diversify the subscriber base and improve the project risk 

profile (Chan, Ernst, and Newcomb 2016; Garren et al. 2016; SELC 2016).

Advantages Disadvantages

• It eliminates the possibility of customer default, 

as customers have no on-going payment.

• It requires funding via state funds, grants, or 

other options.

• Paid subscriptions would need to be reassigned 

if the LMI customer moves out of the 

subscription territory. 

• Developers may be slow to re-assign 

subscriptions.

Option 2: Housing authority manages subscriptions

If programs allow affordable housing units to subscribe and pass the benefits on to their LMI 

tenants, there is little risk of customer turnover or default, as the building landlord would be the 

subscriber, rather than individual tenants. The Public Housing Agency of the City of St. Paul, 

Minnesota, is working with developer Geronimo Energy to subscribe 100% of their electricity 

use at 10 high-rise facilities, and in so doing is expecting to save $130,000 per year, or $3.25 

million over 25 years. Rhode Island and Connecticut also allow affordable housing units to 

subscribe to LMI community solar.

Advantages Disadvantages

• It eliminates the possibility of customer default, 

as the housing authority would be the off-taker.

• There are fewer issues with customer turnover, 

as the housing authority would be able to 

reassign benefits to new tenants.

• There can be complexities in crediting 

customers with direct bill benefits, depending 

on the housing arrangement.

• The structure creates an administrative burden 

for housing authority staff.

Option 3: Bundling energy assistance funds 

Reducing the price of an LMI community solar subscription can be done by lowering the LMI

subscriber’s electricity consumption. By using existing energy efficiency and conservation funds, 

 4 For more on financing options, see Section 4.
13

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

either from federal, state, or utility programs, LMI subscribers can reduce their community solar 

subscription size. Since their subscription costs would be reduced, this would increase the 

likelihood that LMI subscribers would continue to pay their electricity bills and community solar 

subscriptions. The Colorado Energy Office required LMI participants in its grant-funded 

community solar projects to have already had their homes weatherized or be on the waiting list 

for weatherization. The use of federal energy assistance funds to purchase community solar 

subscriptions is discussed in Section 4.3.

Advantages Disadvantages

• It can result in lower bills for LMI customers 

compared to community solar alone.

• Some LMI residences may not qualify for free 

weatherization upgrades, if, for example, their 

house is newer construction.

• Some homes may be on a long waiting list to 

be weatherized, thus delaying community solar 

subscriptions.

Option 4: Subscribers with flexible subscriptions

A large anchor tenant, such as a municipal government, could have a flexible subscription that 

temporarily increases to absorb the loss of subscriptions from LMI customers who move or drop 

out of the program. Non-anchor tenants could also serve this function. Cooperative Energy 

Futures is building community solar gardens in Minnesota that follow this model. It has “backup 

subscribers” such as churches, mosques, and cities that agree to cover defaults by participants. 

That structure is allowing Cooperative Energy Futures to subscribe customers with lower credit 

scores (Jossi 2017).

Advantages Disadvantages

• It reduces risk for the developer.

• It can reduce project financing costs and 

reduce the cost of subscription management.

• Some acquiring of new customers may still be 

required.

• Flexible subscriptions may be bound to a preset amount (e.g., the tenant would take 40%–

50% of the project offtake).

Option 5: Workplace subscription programs

Having customers obtain their subscription through their employer could potentially help address 

turnover as well as credit risk issues. If all or some of the employees are LMI, then the 

community solar project would enable LMI participation. For example, the Vermont Energy 

Investment Corporation worked with a spin-off company, Sun Shares, to subscribe its employees 

to fulfill a 200-kW solar array. The program structure allows employees of all incomes to 

participate (VEIC 2017).

Advantages Disadvantages

• It reduces risk for the developer.

• Employers have a pool of potential subscribers 

to address turnover.

• The employer could also serve as a flexibletenant, as described in Option 4.

• Some new customers may still need be 

acquired.

• The employer would assume the time and cost 

of managing subscriptions.
14

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Option 6: Incentives for maintaining fully subscribed arrays

Programs can provide a financial incentive to third-party-managed community solar by 

providing lower compensation rates for unsubscribed energy. This would incentivize the third

party to maintain full subscription. Policies for compensation of unsubscribed capacity can also

provide a limited backstop for customer defaults (CCSA 2017).

Advantages Disadvantages

• It does not cost the utility anything to incentivize 

full subscription. 

• It makes developer revenue less certain.

Option 7: Shorter contracts

Creating short contract durations (e.g. 2-5 years) and easier options for exiting contracts may 

make initial subscription easier but could increase turnover risk and subscription management 

costs. IREC (2016) suggests that minimum contract duration requirements should depend on 

available financing and acceptable administration costs associated with customer turnover. One 

option to facilitate shorter contracts at lower cost would be to have an intermediary purchaser 

with a longer-term contract. This intermediary purchaser would enable allow the community 

solar project to be financed, then they could assign credits to low-income customers. 

Advantages Disadvantages

• Subscribers may be more likely to participate. • It is riskier for the project developer and 

financer.

• It could increase turnover and subscription 

management costs.

Many of these program and contracting options minimize the risk of customer default. There is 

little to no experience with customer defaults to date, perhaps in part because the programs have 

been structured to fully subsidize subscriptions or reduce electricity bill expenditures. Customer 

defaults could also be mitigated by a loan loss reserve, though this approach has not been used to 

our knowledge. If a public entity or other organization could provide a financial backstop in case 

of default, this would allow developers to obtain lower-cost financing. 

3.6 What are Strategies for Enrolling Customers with Low 

Credit Scores? 

Low credit scores in LMI communities can pose a challenge to customers who need access to 

financial capital to participate in community solar. LMI customers may face higher interest rates 

or may not meet the credit criteria to qualify for loans to defray up-front subscription costs.5 One 

approach to address this challenge is to design programs with pay-as-you-go subscriptions with 

no up-front costs. Other options exist where a pay-as-you-go design is not possible.

 5 While some research has shown that low-income homeowners have lower credit scores on average than higherincome homeowners, research has also identified significant populations of low-income homeowners with credit 

scores high enough to secure financing (Paulos 2017). 
15

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Option 1: Loan loss reserve mechanisms

Programs can create accounts to cover losses if LMI customers are unable to pay back their 

loans. Loan loss reserve mechanisms allow LMI customers to obtain financing at lower interest 

rates despite low credit scores. For example, the Mass Solar Loan Program in Massachusetts 

established a loan loss reserve account for each participating lender in the program.

Advantages Disadvantages

• It provides a backstop for losses, should they 

occur.

• If no losses occur, the funds are not used.

• It requires some entity (typically the state) to 

provide up-front funding for the loan loss 

reserve.

• May not be sufficient if defaults are common.

Option 2: Alternative underwriting criteria

LMI customers may be able to demonstrate creditworthiness in ways other than through their 

credit score. For example, programs may be able to use utility bill payment history to establish 

creditworthiness. The Solstice Initiative, with DOE Solar Energy Technologies Office funding, is 

gathering customer data on income, FICO score, and utility bill repayment history to test whether 

new qualifying metrics would expand access to community solar to additional households. 

Solstice is a community solar developer and will enroll customers and compare their actual 

payment histories (DOE 2018).

Advantages Disadvantages

• It is potentially a more accurate way of 

assessing likelihood of subscriber repayment.

• It could expand the number of possible 

subscribers.

• The success of using alternative underwriting 

criteria for solar financing is being researched, 

but to date is largely unknown.

3.7 Where Should Community Solar Projects be Sited?

Deciding where to locate a community solar project can involve several considerations, 

including the land and interconnection costs that impact overall project costs, grid considerations 

for siting the project, as well as the visibility of the project and proximity to customers. To date, 

programs have taken various approaches to address siting issues for community solar projects; 

some of the considerations and options include the following six options. 
16

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Option 1: Location within utility service area

Community solar projects may generally be sited anywhere within the same utility service area 

as the subscriber base; how close the project is to subscribers may or may not be specified in the

program design. For existing rules on community solar location requirements, see Cook and 

Shah (2018a).

Advantages Disadvantages

• This option provides a larger area to site the 

project compared to siting within a 

neighborhood or on a brownfield.

• It could result in lower land acquisition costs

compared to siting within a neighborhood or on 

a brownfield.

• If the project is sited away from an LMI 

community, it may be less visible to the 

community, resulting in lower subscription rates 

and/or higher costs to subscribe LMI 

customers.

• This option is restricted to states that allow this 

metering arrangement.

Option 2: LMI neighborhood

Several states require that community solar projects be sited in LMI communities; these policies 

do not require that community solar serve LMI subscribers. Siting within LMI communities may 

increase a sense of ownership in local communities, improve the visibility of the project, or 

allow engagement of local communities through volunteer labor and/or job trainees.

Advantages Disadvantages

• This option could enable local economic 

benefits such as job training.

• It may have environmental benefits by reducing 

reliance on local gas-fired peaking plants 

located near LMI communities.

• Siting in LMI communities does not provide 

direct benefits to LMI customers on their 

electricity bills, if they are not subscribers.

• Trying to site projects in dense urban 

neighborhoods may be economically infeasible 

because of lack of land availability and/or highpriced land.

• Siting in LMI communities may have the 

unintended consequence of increasing local 

land prices and rents.

Option 3: Brownfields

Local siting may repurpose urban contaminated sites such as landfills, mine sites, and Superfund 

sites. Assistance may be available to aid in brownfield siting. For example, the U.S. 

Environmental Protection Agency provides technical assistance for community solar projects 

located on contaminated sites regulated under federal and state cleanup programs.

Advantages Disadvantages

• This option repurposes land that does not have 

many other potential uses.

• It preserves existing greenfields.

• Land costs could be less than for a greenfield

development.

• Project permitting may take longer than it would 

for a greenfield.

• Project development costs may be higher than 

those for a greenfield.
17

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Option 4. Locations with utility grid benefits

Some jurisdictions may be interested in exploring how to site community solar projects to 

maximize grid benefits. Utilities may be able to help determine beneficial locations on the grid 

where projects could help avoid congestion or otherwise needed grid upgrades.

Advantages Disadvantages

• The utility could recoup some of the savings in 

exchange for facilitating the project.

• Sites providing favorable grid benefits may not 

be favorable for other reasons (e.g., not enough 

space or high-cost land).

Option 5: Public or donated land

LMI community solar projects could be sited on suitable public lands or donated land. For 

government sites, details about the terms of the land lease, permitting terms, and the duration of 

the agreement are important considerations for development of community solar projects. In 

some cases, access to public lands may have more restrictions and the process of leasing may be 

more onerous than for private land.

Advantages Disadvantages

• Land may be low or no-cost to the developer. • In some cases, government lease rates can be 

higher than those of private landowners.

• Government sites may be unable to be 

permitted quickly or they cannot be guaranteed 

for 20 years of use.

• May impose additional restrictions.

Option 6: Rooftop (e.g., affordable housing and mixed-income housing)

Another option is to site smaller projects on LMI rooftops. For example, this could be done on 

multiple affordable housing units or on mixed income housing developments. Washington, D.C. 

is funding rooftop installations that provide benefits to low-income residents, through its Solar 

for All program (Text Box 2).6

Advantages Disadvantages

• This option may be particularly attractive in 

urban areas that are land-constrained.

• No cost to lease or purchase land.

• It may require supportive state or utility 

metering policies. 

• Installation costs may be higher for rooftop 

systems.

 6 “Solar for All,” Washington, D.C. Department of Energy & Environment, https://doee.dc.gov/solarforall.
18

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Text Box 2. Washington, D.C.’s Solar for All Program

Washington D.C.’s Renewable Portfolio Standard Expansion Amendment Act (2016) established the District of Columbia Solar for All program. It requires the 

D.C. Department of Energy and Environment (DOEE) to reduce the electric bills of at least 100,000 low-income households by at least 50% by 2032. DOEE 

proposed community solar as one of several strategies to meet the Solar For All requirements. The program is funded through alternative compliance payment 

revenue. From 2017 to 2019, DOEE will provide $20M–$45M to support 30–60 MW of solar projects in the district. As a first step, DOEE will provide $13 million 

for low-income projects: $8 million for multifamily, commercial, institutional buildings, and non-residential spaces, and $5 million for single-family homes, small 

businesses, and non-profits. The projects funded in FY17–FY18 are primarily solar installations at affordable housing or community buildings, with the bill credits 

going to low-income households (Table 2). Other examples include: siting solar on university buildings and giving the associated solar renewable energy 

certificate (SREC) revenue to low-income households. One project is installing solar on multifamily buildings, with the savings achieved going to building 

upgrades, amenities, and resident services. Projects such as that come in at a lower cost per low-income customer and per Watt; but in that case, customers are 

not receiving a tangible benefit such as free electricity. 

Table 2. Washington, D.C. Solar for All Innovation and Expansion Grant Projects Funded FY17–FY18

Grantee Project Type Benefit to Low-Income Customers Project Size 

(kW)

Total Grant 

Amount

Low-Income

Customers 

Supported

Cost/Watt

Cost/LowIncome

Customer

Community 

Preservation and 

Development Corp.

Installations on 

multifamily buildings

Building upgrades, new amenities, and resident 

services 1,000 $300,000 2,800 $0.3 $107 

Urban Energy 

Advisors/NHT 

Enterprise

Installations on 

affordable, 

multifamily buildings

Not defined in the report 1,000 $1,517,655 402 $1.5 $3,775 

Ethos Strategy 

Consulting

Installations at 

affordable housing 

properties

"Direct payment" to low-income residents for 25 

years 1,000 $1,790,000 350 $1.8 $5,114 

New Partners 

Community Solar 

Corp.

Siting on community 

buildings

Free, 25-year community solar subscriptions for 

low-income households 1,000 $2,000,000 325 $2.0 $6,154 

Open Market ESCO

Installations on 

affordable, 

multifamily buildings

Free, 15-year community solar subscriptions for 

low-income households 548 $1,347,737 195 $2.5 $6,911 

Community Power 

Network – DC SUN

Bulk procurement 

for on-site solar on 

low-income

households

Free on-site solar for low-income households 750 $2,000,000 231 $2.7 $8,658 

Groundswell Siting on community 

buildings

Free, 20-year community solar subscriptions for 

low-income households 366 $1,261,590 122 $3.4 $10,341 

Neighborhood Solar 

Equity, LLC

Solar installations at 

a local university

SREC revenue to low-income households for 15 

years

595 $1,177,506 100 $2.0 $11,775 

PEER Consultants, 

P.C.

Installations on 

affordable, 

multifamily buildings

Free, 15-year community solar subscriptions for 

low-income households 500 $1,250,000 100 $2.5 $12,500 

Source: DOEE 2017
19

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4 Incentives and Financing

LMI community solar projects generally have higher project financing, customer acquisition, 

and subscription management costs than projects where no LMI customers participate. In 

addition, LMI customers may need to receive a larger financial benefit from subscribing than 

non-LMI customers, in order to sign up. Some type of incentive may be necessary to defray 

these additional project costs and induce project developers to implement LMI community solar 

programs. In some cases, incentives go directly to developers, who can then pass along lower 

costs to LMI subscribers. In other cases, incentives may go directly to the LMI subscriber. In this 

section, we review how states can leverage incentives and financing structures to reduce the 

price of community solar for LMI customers.

4.1 How Much Financial Incentive Do LMI Customers Need to 

Participate in Community Solar?

Community solar pricing around the country varies considerably due to differences in available 

incentives, solar irradiance, electricity costs, and PV installation costs. In some markets, 

developers can offer products with no up-front payment and the ability to save from Day One. 

Payback periods vary depending on the up-front cost of the subscription, eligibility to take the 

federal investment tax credit, and the bill credits received. The production of the customer’s 

share is typically credited at the retail rate and may include a REC or incentive payment. Table 3

provides a sample of community solar pricing and structures from around the country (for 

projects designed for all customer classes, not LMI specifically). While this list is not

comprehensive, products were selected to provide a range of options currently available. While 

immediate savings are available through products offered in Massachusetts and Minnesota, all 

other products are structured as an up-front payment with simple paybacks ranging from 7 to 12 

years.

Subscription models with an up-front payment and multi-year payback periods are likely less 

feasible for LMI customers. While up-front payments could be financed through a traditional 

bank loan, LMI customers may not qualify, or they may have to pay high interest rates for such 

loans. To address concerns about affordability of community solar for LMI customers, programs 

are being designed either as a free program or as one with a minimal ongoing payment paired 

with a bill credit. For example, the Colorado Energy Office targeted a 30%–50% reduction in 

LMI bills through its community solar pilot programs. The targets were developed with the 

purpose of lowering LMI energy burden to the state average.

Program designers can decide how much to subsidize LMI participation in community solar by 

examining energy burden, according to the following equation:

Electricity energy burden = annual electricity expenditures/annual household income
20

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Table 3. Variations in Community Solar Pricing and Product Structures

Project State Financing Available? Up-front or Monthly Cost Credits Received on 

Electricity Bill

Estimated Savings 

or Simple Payback 

Period

Clean Energy 

Collective (Orange 

& Rockland and 

Central Hudson)

NY N/A Guaranteed savings of $0.01 per kilowatt-hour of electricity ~12% savingsa

Blue Wave Mendon 

Solar Project MA N/A; monthly payment Monthly discount of 10% on 

electricity N/A 10% savingsa

SunShare MN N/A; monthly payment

14.01 cents/kWh for kWh 

subscribed to; 2.75% annual 

increase in rate

14.596 cents/kWh Approximately 

4% savingsa

Seattle City Light WA No $6.25/W

$0.70/kWh (state incentive) 

+ $0.09/kWh virtual net 

metering credit

7 yearsb

Clean Energy 

Collective (Xcel 

Energy)

CO

No, but directs 

customers to Elevation 

Solar or other local 

resources

Up-front cost of $2.50/W 13.6–18.6 cents/kWh 8.5 yearsa

Renovus 

Community Solar NY No Up-front cost of $2.09/W Net metering rate 9 yearsa

New Richmond 

Utilities Solar 

Garden Program

WI No $1.80/W

$0.078/kWh (if utility keeps 

RECs), $0.076 (if customer 

keeps RECs)

11–12 yearsc

a Company estimates

b Assumes 4,357 kWh/year produced (PVWatts) and that the subscriber uses the Washington state incentive (estimated at $0.70/kWh) 

and receives net metering credit at the low general service rate of approximately $0.09/kWh 

c Assumes 5,388 kWh/year produced (PVWatts) and that the subscriber uses the federal investment tax credit of 30%
21

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

There are many ways a program could reduce electricity burden for LMI customers. Table 4

shows two examples using community solar: (1) provide free subscriptions (e.g., bill credits from 

the output of the subscription to the array) for part of a customer’s electricity use or (2) provide 

reduced cost electricity from community solar for all of the customer’s electricity use. These 

programs could be paired with weatherization efforts to minimize the bill savings required from 

the community solar subscription. 

Table 4. Options for Using Community Solar to Reduce Electricity Burden

Assumptions

Annual electricity expenditures before solar $1,000 

Annual income $25,000 

Electricity burden before solar 4%

Target electricity burden rate 2%

Reduction in annual electricity bill needed to meet electricity burden target $500 

All-in electricity rate $0.12/kWh

Annual energy use 8,333 kWh

Example 1 

Provide free electricity for 50% of customer's annual electricity expenditures 4,167 kWh

Solar size needed 3.2 kW

Annual electricity expenditures after solar $500.00 

Example 2

Provide reduced cost electricity for 100% of customer's annual consumption 8,333 kWh

Solar size needed (kW) 6.3 kW

Annual electricity expenditures after solar $500.00

In both examples, the LMI customer is reducing annual electricity expenditures by one half, 

from $1,000 to $500. In Example 1, the LMI customer receives $500 of free electricity, provided 

by a 3.2-kW share of a community solar array, which provides 4,167 kWh annually (50%) of the 

customer’s consumption. In Example 2, the LMI customer receives 100% community solar at a

price discounted from their exiting electricity rate ($0.06/kWh instead of $0.12/kWh), from a 

6.3-kW share of a community solar array. These examples are for illustrative purposes only—to 

highlight different options for reducing LMI customer electricity bills through community solar.

4.2 What Financing Strategies Exist to Help Cover Up-Front Cost? 

Up-front cost can be a significant barrier for LMI customer participation. In a survey of 

approximately 500 potential LMI community solar customers, the Pacific Consulting Group 

(2017) found the top three considerations for participating in community solar were up-front 

cost, percentage of bill covered, and initial contract duration (Figure 2).
22

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Figure 2. Considerations for LMI participation in community solar

Source: Pacific Consulting Group (2017)

While some community solar programs are offered as part of a pay-as-you go model with zero 

up-front cost (e.g., the Blue Wave project in Massachusetts), most community solar programs 

require an up-front payment.7 Low credit scores pose challenges for LMI customers to obtain 

financing for solar products. Even for customers with strong credit scores, some LMI customers 

may be reluctant to take on a new line of credit to finance their solar investment, especially 

if financing requires a down payment. Several innovative financing schemes allow states 

to circumvent the challenges associated with traditional financing schemes: 

Option 1: On-bill financing

On-bill financing allows customers to pay community solar subscription fees through ongoing 

payments on utility bills. On-bill financing may base creditworthiness on utility bill payment 

history rather than traditional credit criteria. For instance, the Grand Valley Power LMI program 

in Colorado allows LMI customers to pay subscription fees through on-bill financing. The 

program charges a subsidized subscription fee of $0.02/kWh, which is simply subtracted 

from LMI customers’ bill credits (see Text Box 2). 

Utilities considering offering an on-bill financing option should consult with their regulators to 

ensure the service would be allowed. For example, in Texas, transmission and distribution 

utilities are not allowed to offer services that could be provided by competitive service providers 

unless they are mandated to do so by lawmakers. Regulators can be skeptical of on-bill 

financing, as the service may result in additional financial risk to the utility and/or costs being 

borne by non-participants (e.g., billing system upgrades) (RAP 2017).

Advantages Disadvantages

• LMI customers do not need to obtain up-front 

capital to fund their subscription.

• LMI customers would have both their payments 

and credits on their utility bill (can see net 

savings).

• The potential subscriber pool can be increased 

by using bill repayment history as a proxy for 

creditworthiness.

• The risk of subscriber default falls on the utility.

• If the subscription is higher-cost than the 

default electricity product, subscribers are at 

higher risk for not paying their bill and being 

disconnected; disconnection would not happen 

if the loan were provided by a third party 

(RAP 2017).

• Utility financing may be restricted by regulators.

 7 The Blue Wave project is likely able to offer a zero up-front cost model because of the high SREC values 

in Massachusetts. 

29%

16%

14%

12%

11%

10%

8% Initial investment (29%)

Percent of bill covered (16%)

Duration of contract at initial sign-up (14%)

Incentive (12%)

Net monthly impact on bill 5 years out (11%)

What you lease or own (10%)

Initial net monthly impact on bill (8%)
23

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Text Box 3. On-Bill Financing Options through Utility-Owned LMI Community Solar 

Grand Valley Power

The Grand Valley Power (GVP) Solar Garden is a 100-kW utility-owned community solar array in 

Grand Junction, Colorado. GRID Alternatives operates and manages the array on GVP property. 

GVP manages subscriptions. The project serves eight LMI households in GVP’s service territory. 

Housing Resources of Western Colorado, a non-profit energy efficiency services firm, vets eligible 

program participants. Subscribers receive monthly net metering credits at about $50/month. 

Subscribers pay no up-front cost but pay a fee of about $0.02/kWh, or about $9/month, to defray 

management costs. 

GVP also offers an on-bill financing program for a separate 17-kW community solar array. The 

program allows customers to subscribe with no money down and a zero-interest loan paid through 

monthly on-bill installments of $15/month for five years. The on-bill financing program is available 

to all GVP customers, regardless of credit history.

Fort Collins Utilities

The Fort Collins Utilities (FCU) Rooftop Solar Garden is a 65-kW utility-owned community solar 

array in Fort Collins, Colorado. The array serves about 20 LMI households per year in the FCU 

service territory and is qualified annually through the utility’s Low-Income Energy Assistance 

Program, prioritizing customers who are all-electric. Subscribers receive a monthly bill credit worth 

about $25/month that is designed to reduce subscriber energy burdens to 4% of annual income. 

Subscribers make no up-front or ongoing payments. Subscribers agree to complete FCU-provided 

energy efficiency upgrades and participate in energy education events.

Option 2: Lower interest rates loan

In Massachusetts, LMI customers are eligible for lower interest rates under the Massachusetts 

Solar Loan program. This can be used for community solar subscriptions in Massachusetts that 

require an up-front payment. The Mass Solar Loan program offers to reduce interest rates for 

solar loans by 1.5 percentage points. Furthermore, the program pays down 20% of the loan 

principal for customers below 120% of state median income, and 30% of the principal for 

customers below 80% of state median income. 

Advantages Disadvantages

• LMI customers pay lower interest rates, thus 

making subscription more financially attractive.

• Such loans require a subsidy to cover risk and 

buydown.

• Customers may be resistant to signing a loan.

Administrative process and paperwork could be 

barrier.

4.3 How Can Existing LMI Programs be Leveraged to Incentivize 

Community Solar Participation? 

Existing rate subsidies for LMI households may support participation in community solar arrays. 

Programs could be designed to leverage utility low-income bill subsidies, federal LIHEAP 

dollars, and/or federal Weatherization Assistance Program dollars. 
24

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Option 1: Utility low-income bill subsidies

Many utilities provide energy subsidies to low-income customers through ratepayer surcharges. 

These public utilities commission-mandated actions are known as utility-funded energy subsidies 

and are different from government assistance programs. Just as these “discounts” are given to lowincome citizens, they could also be used for community solar subscriptions. These dollars are 

separate from any government assistance programs described below. An informal survey by SEPA

(2017a) found that nationally several utilities had bill reduction programs ranging from 10% to 

50% of customers’ bill. In California, the Interstate Renewable Energy Council (IREC 2016) has 

proposed using some of the revenue that supports the California Alternate Rates for Energy 

program to fund a 5-MW community solar pilot program. 

Advantages Disadvantages

• This option would invest in an asset with 

potential financial return, instead of spending 

additional dollars each year. 

• It requires approval from state utility regulators.

• Would require buy-in from stakeholders 

involved, who may be reluctant to divert energy 

subsidies to solar investments.

Option 2: Federal Weatherization Assistance Program (WAP)

Federal appropriations provide formula grants to states to weatherize homes for low-income

residents. Each state develops a plan outlining their weatherization goals, which are to be 

implemented by weatherization subgrantees. Those state plans are submitted to and approved by 

a DOE project officer. Though renewable energy has been approved for use under the Energy 

Policy Act of 2005, any project must be able to achieve a savings-to-investment ratio of 1.0 or 

greater. In addition to meeting the savings-to-investment ratio requirement, the maximum 

amount that could be spent on a renewable energy system was $3,598 in 2017 (DOE 2017); this

limits the size of system that could be installed. At $2.50/W, the spending cap would limit 

installations to a 1.4-kW system. 

To date, no state has used WAP funds for community solar, though a recent WAP memo (DOE 

2017) indicates this may be possible. New York is investigating this issue and has put it into their 

WAP state plan. WAP Memorandum 0248 outlines the general process for including solar and 

provides tools and resources for determining the savings-to-investment ratio. 

 8 “WAP Memorandum 024: The Use of Solar PV in the WAP,” DOE, 

https://www.energy.gov/eere/wipo/downloads/wap-memorandum-024-use-solar-pv-wap. 
25

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Advantages Disadvantages

• This option would invest in an asset with 

potential financial return, instead of spending 

additional dollars each year. 

• Getting a state plan approved and implemented

could be time-consuming.

• Individual project approval could be timeconsuming.

• No examples exist to our knowledge of a WAP 

being used for community solar.

• The funding amount is capped so that the 

system purchase may not meet 100% of the 

household’s electricity needs (depending on the 

household size) unless paired with other 

funding mechanisms.

Option 3: Federal Low Income Home Energy Assistance Program (LIHEAP)

Federal LIHEAP dollars are used to provide energy bill assistance to low-income residents. The 

program primarily provides bill assistance by paying the utility. LIHEAP dollars are also used 

for weatherization efforts (typically 5%–15% of a state’s LIHEAP allocation go to 

weatherization). If a low-income resident were a subscriber to a community solar array, LIHEAP 

dollars could be used to pay their community solar subscription, though this structure has not 

been used to our knowledge. A few states are exploring using funds they typically allocate from 

LIHEAP to pay for multifamily solar or community solar projects. 

While no state has used LIHEAP or WAP funds for community solar, Colorado is using a 

combination of WAP and LIHEAP dollars, along with funding from the state’s two investorowned utilities, to install solar on 300 single-family homes This was the first solar PV pilot 

supported by the WAP, and it installs panels on homes that will also have energy efficiency 

upgrades. New York was more recently approved by their federal project officer to use WAP 

dollars for solar on multifamily buildings.9

 

Advantages Disadvantages

• This option would invest in an asset with 

potential financial return, instead of spending 

additional dollars each year. 

• This option could result in more households 

reached with federal dollars, since fewer 

households would need ongoing energy 

assistance if their community solar subscription 

were pre-paid via federal funds. 

• Getting a state plan approved and implemented

could be time-consuming.

• No examples exist to our knowledge of LIHEAP 

being used for community solar.

 9 To get approval, New York included solar for multifamily buildings in its state WAP plan, which then was 

approved by its federal project officer. 
26

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

4.4 What Other Incentives Help Developers Offer More Favorable 

Rates to LMI Customers?

Unlike some other customers, LMI customers may require quicker returns (e.g. savings from 

day-one) from community solar participation. Incentives may be necessary to help developers 

offer more favorable rates to LMI customers without overburdening other subscribers. Examples 

of incentives include the following four options.

Option 1: Community Reinvestment Act investments

Some banks may be willing to invest in community solar and donate the shares to LMI 

customers, thus eliminating the up-front cost barrier, as one way to fulfill their Community 

Reinvestment Act (CRA) obligations. Alpine Bank purchased 25 kW from Clean Energy 

Collective’s Breckenridge Ullr Community Solar Array in Colorado. The bank then donated the 

shares to the Family & Intercultural Resource Center, which assigns monthly bill credits to local 

families needing assistance. This structure enables Clean Energy Collective to meet the 5% LMI 

carve-out requirement. Alpine Bank benefits from being able to take a tax deduction for the 

donation as well as potentially being able to use the donation to meet CRA obligations. Federal 

regulators recently clarified that investments in off-site renewables are eligible for banks to use 

to demonstrate CRA activities, “so long as the benefit from the energy generated is provided to 

an affordable housing project or a community facility that has a community development 

purpose” (Federal Register 2016). 

Advantages Disadvantages

• CRA investments would reduce the cost of LMI 

subscriptions.

• Banks could bundle CRA investments with their

own subscription to gain a bulk discount (as 

Alpine Bank did). 

• Can be financially beneficial for a bank.

• Banks have many options for CRA investments 

with which community solar would need to 

compete.

Option 2: New Markets Tax Credit (NMTC)

Project developers could also use the New Markets Tax Credit (NMTC) to lower the cost of 

community solar subscriptions. The NMTC provides investors with a tax credit of 39% of the 

qualified equity investment made, realized over a seven-year period. The NMTC applies to 

investments made in business or economic development projects located in census tracts where 

the poverty rate is at least 20% or where median family income does not exceed 80% of the area 

median. The NMTC has been used for utility-scale solar arrays (e.g., 1.65 MW in Salt Lake 

County and 1.56 MW in Cincinnati) (NDC 2015), but no examples of NMTC being used for 

community solar exist to our knowledge. One project in California used NMTC to finance solar 

on affordable multifamily housing units, taking advantage of California’s Multifamily 

Affordable Solar Housing virtual net metering program as well. The project provided solar 

energy to tenants at no cost (Treasury 2011).
27

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Advantages Disadvantages

• NMTC would lower the project cost and enable 

greater LMI participation.

• Obtaining NMTC can be a complex process.

• No NMTC examples for community solar exist.

Option 3: Grant funding

Several states are providing—or plan to provide—grant funding for LMI community solar 

projects. Some states have conditioned funding on requirements that the demonstration projects 

benefit LMI customers. Grant funding can be also tailored to provide additional benefits, such as 

job training. For example, the Colorado Energy Office provided $1.2 million in grant funding 

for 8 LMI demonstration projects. The grant funding was used to achieve a 50% target energy 

burden reduction for LMI customers. The Connecticut pilot program favors project proposals 

with more than 20% LMI participation. Washington, D.C. provided up to $100,000 for projects 

that demonstrate how community solar can benefit LMI customers.

Advantages Disadvantages

• This option would directly lower the project cost 

and enable greater LMI participation.

• Grant-making organizations may be able to 

fulfill multiple objectives (e.g., including job 

training).

• It requires state or other appropriations.

• It may not be sustainable for future projects.

Option 4: Incentive multipliers or customer acquisition subsidies

Many states have existing solar incentive programs, such as net metering, solar renewable energy 

certificate (SREC), and low-interest loan programs. LMI customer participation in community 

solar programs can be subsidized through incentive multipliers in such pre-existing programs. 

For example, the Mississippi net metering program included a $0.02/kWh net metering adder 

for the first 1,000 income-qualified LMI customers to enroll in the program. State programs 

could also provide per-customer subsidies to defray the costs of LMI customer outreach (see 

Section 5). For instance, the Rhode Island program provides a $200 subsidy to developers for 

each LMI customer subscription. The program requires developers to pass the subsidy through to 

the customer in the customer’s rate agreement.

Advantages Disadvantages

• It provides flexibility for developers to enroll as 

many LMI customers as possible.

• Setting an appropriate incentive amount may 

be challenging.

• It requires state or other appropriations.

• May still have risk of under-enrollment.
28

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

5 Customer Outreach

Interviewees consistently cited customer outreach as a primary challenge of implementing LMI 

community solar programs. The first outreach challenge is to identify program-eligible LMI 

customers. The second challenge is to enroll program-eligible customers through effective 

messaging catered to LMI customers. Ongoing partnerships may be a crucial component of 

effective customer outreach. Challenges with reaching LMI customers can increase customer 

acquisition and retention costs.

5.1 How to Reach Eligible LMI Customers and Potentially Target 

Specific Customer Types? 

In general, one of the biggest challenges with obtaining participants in community solar projects 

is getting the attention of customers and having the opportunity to explain the program. For 

subscriber-based programs like community solar, gaining access to customers is a key challenge, 

and it can be more pronounced for LMI customers, who can be even more difficult to reach. 

Lessons from energy efficiency programs that target LMI customers indicate several LMI 

customer types are particularly difficult to reach, including renters, foreign language-speaking 

households, and others (Table 5). For these reasons, piggy-backing on existing LMI programs or 

partnering with groups that are regularly interacting with the LMI community can be effective. 

Some programs have relied on referrals of existing participants to spread the word. Often, this 

can be effective once a customer experiences real financial benefit from a program. Referrals 

from friends and relatives can provide a trusted source of information for LMI customers who 

may be leery of third-party marketing efforts. Referrals have been shown to be a successful way 

of acquiring residential PV customers, providing $250 to over $1,000 in rewards to an existing 

customer for their successful referral (GTM 2017). GTM (2017) estimates the cost of referrals at 

$0.31/Watt with community events also being a lower-cost customer acquisition option, at 

$0.40/Watt. These estimates are for on-site residential PV systems. 

Table 5. Hard-to-Reach Low-Income Customers

Hard-to-Reach Low-Income Customers

Renters in multifamily properties 

Rural households

Foreign-language-only households

Undocumented immigrants

Seniors

People with disabilities

Source: Hoffman 2017

Program eligibility definitions can also exacerbate customer outreach challenges if eligibility 

requirements are complex, require income documentation from customers, or are otherwise

difficult to verify. Easily verified eligibility criteria facilitate the identification of programeligible customers, while complex criteria or criteria that are difficult to readily verify can make 
29

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

it more challenging to target customers and conduct outreach through partners. For example, 

customers may not be willing to provide certain types of documentation of their income levels. 

A common method to facilitate LMI customer identification is to define program eligibility 

consistently with pre-existing programs. For example, several programs allow customers 

participating in state LIHEAP programs to participate in LMI community solar programs, by 

default. Consistent program eligibility criteria across LMI programs allow outreach coordinators 

to use existing lists of program-eligible LMI customers. One outreach coordinator noted that 

customers who already participate in other LMI energy programs are more likely to enroll in 

LMI community solar programs.

5.2 What Are Effective Partnerships for LMI Customer Outreach? 

Several interviewees reported that effective LMI customer outreach requires engagement with 

multiple partners. Effective partnerships may reduce program costs associated with LMI 

customer identification and acquisition. Partners can include a variety of types of organizations 

(see Table 6) such as utilities, community LMI groups/NGOs, low-income weatherization or 

efficiency programs, housing authorities, or solar developers. Each of these can play a slightly 

different role in the program—from basic education and outreach to potentially enrolling 

customers directly. In some cases, affordable housing programs can play a role in subscription 

management as well. 

The most promising partners are generally those that are trusted and have frequent touch-points 

with LMI customers to leverage existing outreach efforts and channels. It can be effective to 

approach LMI customers with a bundle of several related programs and use existing outreach for 

related offerings, such as efficiency programs. These partners often are known within the LMI 

community and can have the trust of community members, which is important for subscribing 

customers. Figure 3 presents survey data from potential low-income customers, ranking their 

preferences for sources of information on community solar programs, from most trusted sources 

(10) to least trusted sources (0). 
30

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Table 6. Partnerships for LMI Customer Outreach

Partner Value of the Partnership

Utilities

Utilities have the most direct access to customer information and can 

most readily estimate customer energy burdens and customers 

participating in low-income programs. Some utilities already have ratesubsidized customers that may automatically be eligible for LMI 

community solar programs. Also, utilities are known by LMI customers 

with outreach channels. 

Community LMI 

groups/NGOs

While utilities may be trusted sources of information (Figure 3), LMI 

customers may still be skeptical of their utility. Working with a non-utility 

partner may help programs overcome LMI customer skepticism. 

Community groups already have established relationships with LMI 

customers that facilitate customer education and acquisition.

Existing LMI programs 

(e.g., LIHEAP)

Collaboration with other LMI programs to raise awareness can be 

effective. Leveraging existing outreach materials can reduce subscription 

costs. 

Housing authorities

Housing authorities have access to customers for outreach. They may be 

able to serve as the community solar subscriber and pass benefits 

through to their tenants.

Solar developers Solar developers can provide expertise on customer acquisition, even 

if these practices must be modified in the LMI context.

Figure 3. Trusted sources of information for community solar programs

among low-income potential customers 

Source: Pacific Consulting Group 2017

0 2 4 6 8 10

Well-known personality

State Governor

Neighbor

Local community spokesman

Solar organization

Non-profit organization

Utility

Source Priorities
31

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

5.3 What Are Effective Messaging Strategies to Reach 

LMI Customers? 

Several interviewees stated that LMI customer outreach requires different messaging techniques 

than typical solar customer acquisition. However, if community solar projects can offer customer 

savings from the outset (e.g., through pay-as-you-go models that yield net savings), overall 

customer messaging strategies about savings may be the most effective for all customer types. 

However, for community solar projects in markets where the economics are not attractive for all 

customers, such messaging may not be feasible. 

In addition to cost savings, ease of access can be important. A survey of approximately 500

potential LMI customers that was conducted by Pacific Consulting Group (PCG 2017) found that 

the most appealing messaging to respondents was messaging about availability to everyone 

(homeowners and renters), no start-up costs, cost savings, and the ability to buy solar 

immediately (see Figure 4). Messages about the environmental benefits and the fact that 

community solar is local were among the next most appealing messages (PCG 2017). 

Figure 4. Most compelling messaging for LMI customers based on survey data 

Source: Pacific Consulting Group 2017

Interviews conducted by NREL with LMI program practitioners resulted in several additional 

insights about effective messaging strategies, including those described in the rest of this section.

Avoiding Customer Skepticism. LMI customers in particular may be skeptical about 

opportunities that sound too good to be true. Messaging based only on benefits may increase 

0 2 4 6 8 10

Buying or leasing too expensive

Grows the solar industy

Solar panels are not on your roof

Avoids use of fossil fuels

No maintenance

Growing demand for community

Promotes renewable energy

Community solar is local

Conserve natural resources

Hedge against rising utility costs

If you move you can take it with you

Get started right away

Saves you $

No start-up costs

Every homeowner or renter eligible

Communications Priorities
32

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

customer skepticism of the program’s legitimacy. Instead, messaging should convey benefits and 

costs. Information that can be useful includes customer’s current electricity costs, the customer’s 

subscription cost (even if the program is subsidized), and the value of the customer’s bill credits. 

Messaging with cost information reinforces the program’s legitimacy. A clear cost structure 

reduces perceived risks. With transparent cost structures, customers can see there are no hidden 

contractual terms that could hurt the customer in the long term. Avoiding customer skepticism 

can also be addressed by having the messaging come from a known and trusted entity, such as a 

utility or non-profit organization. 

Audience-Specific Messaging. In some cases, it may be best to assume LMI customer bases 

have lower education levels and tailor a simpler message for LMI customers. Promotional 

materials could include basic educational information about solar and energy in general. 

Outreach groups should be prepared to speak languages that are prevalent in local LMI 

communities and prepare promotional materials in those languages. Outreach efforts should 

concentrate on local media frequently used by LMI customers (see section 5.4). 

Localized Messaging and Pilots. Effective LMI messaging may vary in different contexts. 

For this reason, several interviewees indicated they are piloting different LMI outreach

techniques in local areas to better understand effective marketing approaches. Some programs 

are using pilot programs to test messaging in certain regions and evaluating results to refine 

messaging. This approach may help identify effective LMI messaging approaches catered to 

local nuances.

5.4 What Are Effective Communications Vehicles? 

Another consideration is distributing messaging and related materials through effective media 

sources. According to the PCG (2107) survey of LMI customers, the most effective outreach 

channels are information on the utility bill, followed by more mainstream media channels such 

as TV and direct mail (see Figure 5). 

The cost of outreach is an important consideration, and the need for continued outreach over the 

duration of the project can be a challenge. For this reason, lower-cost approaches may be 

required to minimize subscription costs. Language barriers are also a consideration when 

selecting appropriate communications vehicles. 

Figure 5. Most effective messaging channels for LMI community solar customers

Source: Pacific Consulting Group 2017

0 2 4 6 8 10

Radio spot

Social Media

Newspaper

E-mail

Web

Utility bill stuffer

Mailer

TV spot

Message on utility bill

Media Priorities
33

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

6 Summary 

Many states are acting to ensure LMI customers can participate in community solar programs. 

To date, 11 states and Washington, D.C., have made efforts to expand LMI access to community 

solar, though programs range widely and are generally in the first stages of implementation. 

Policymakers developing new LMI community solar programs are considering options related to 

program design and structure, incentives and financing, and customer outreach.

Program design and structure set the foundation for successful implementation. 

Key considerations include the following: 

• What is the program’s goal? 

• Will LMI participation be mandated, incentivized, or otherwise supported?

• How might LMI community solar subscriptions be financed or subsidized?

• How will LMI customers be defined?

• Who is responsible for signing up and retaining LMI customers?

• How can customer turnover and default risk be reduced?

• How is billing and crediting handled?

• Where should LMI community solar projects be sited?

For LMI community solar, additional incentives and financing options are often needed to 

make the program work for LMI customers. While some community solar programs do offer 

pay-as-you-go options, most require an up-front payment. State policymakers can consider what 

funding options may be available to address upfront costs and increase bill savings for LMI 

customers. Policymakers can also work with project developers to create lower-cost project 

financing options. 

Finally, the LMI population can be difficult to reach and skeptical of free or low-cost products. 

LMI community solar can be effective by partnering with groups that already interact with LMI 

populations, including utilities, community groups, existing LMI energy programs, and housing 

authorities. Effective messages include that all renters and homeowners are eligible and what the 

cost savings potential are. However, the limited experience in LMI community solar suggests 

that benefits paired with a discussion of costs can facilitate participation, even if the only cost is 

the time to sign up. 
34

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

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This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

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New Approaches,” Presentation by LBNL to CESA Webinar, March 23, 2017 

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Renewable Resources Public Act 99-0906, Illinois Public Service Commission,

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IREC (Interstate Renewable Energy Council). 2016. Shared Renewable Energy for Low- to 

Moderate-Income Consumers: Policy Guidelines and Model Provisions.

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Office. November. 

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37

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

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_income_rfp.
39

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

Appendix

Overview of Existing Programs—Information Current as of May 2018

State 

Program

Program 

Status 

(Launch 

Date)

Program Structure / Capacity Targets 

for LMI Customer Eligibility Incentives and Financing

Outreach and 

Partnerships

California 

Solar Initiative 

Multifamily 

Affordable 

Solar Housing

Closed to 

new 

applications 

(2017)

33.75 MW currently interconnected, and 

28 MW of active reservations. Systems 

with virtual net metering and over 50% of 

credit directly benefiting tenants receive 

$1,800 per kW installed. Rooftop 

installations or those with less than 50% 

directed toward tenant benefit receive 

$1,100 per kW installed. 

House received financing 

from low-income housing tax 

credits, tax-exempt mortgage 

revenue bonds, general 

obligation bonds, or any 

government grants. 

Financed through state 

legislature. Extended by 

$108 million and five 

years in 2013. 

Go Solar 

California

Colorado 

Community 

Solar Gardens

Active (2011)

5% LMI requirement for each individual 

community solar array, designated 

through rulemaking.

Customers must qualify for 

LIHEAP or be a member of 

Energy Outreach Colorado, 

GRID Alternatives, or The 

Atmosphere Conservancy. 

Municipal housing authorities 

are also eligible.

Free subscriptions given 

to LMI customers by 

developers (costs 

presumably passed on 

to non-LMI community 

solar subscribers). 

Denver 

Housing 

Authority, 

Alpine Bank.

Colorado LowIncome 

Community 

Shared Solar 

Demonstration 

Project

Closed

(2015)

Five demonstration projects (total 1.5 

MW) designed for majority LMI.

$1.2 million in grant 

funding.

GRID 

Alternatives.

Colorado Xcel 

Energy 

Settlement

In 

development 

(2016)

13.5 MW of LMI community solar. 

Procured annually (2017–2019) through a 

4-MW RFP, and 0.5 MW through 

standard offer; Xcel Energy assuming the 

5% carveout through a new program 

(under development).

REC incentive paid by 

ratepayer funds.

To be 

determined.
40

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

State 

Program

Program 

Status 

(Launch 

Date)

Program Structure / Capacity Targets 

for LMI Customer Eligibility Incentives and Financing

Outreach and 

Partnerships

Connecticut 

Shared Clean 

Energy Facility 

Pilot Program

Pilot (2015)

Three pilot projects (total 5.2 MW) 

selected, each with 20% LMI 

participation; Senate Bill 9 (2018) made 

the Shared Clean Energy Facility program 

permanent, allowing up to 25 MW of 

projects per year, with 10% of capacity 

towards low-income subscribers, 10% to 

LMI or low-income service organizations. 

Households, master-metered 

households, and affordable 

housing building owners are 

eligible.

CT Green Bank has 

proposed offering lower 

interest rates to projects 

that provide greater 

costs savings to LMI 

customers.

Voluntary 

partnerships 

with CT Green 

Bank, 

PosiGen.

District of 

Columbia 

Solar For All

Active (2016)

Program to reduce electricity bills of at 

least 100,000 low-income households by 

at least 50% (community solar is one 

piece of this program).

Low-income defined as 

households with below at or 

below 80% of area median 

income.

$13 million in grants, 

initially.

WAP, 

Employment 

Services, DC 

Housing 

Authority.

Hawaii 

CommunityBased 

Renewable 

Energy

In 

development 

(2015)

50% LMI carve-out for 9 MW of utility-led 

projects. Peak-dispatch incentives 

encourage community storage projects. 

Utilities and third-party 

organizations instructed to 

work with state and federal 

entities in forming a definition 

of verification process. 

None now. Funding may 

be available from the 

Hawaii Green 

Infrastructure Authority.

Hawaii’s 

Public Utilities 

Commission

instructs 

utilities and 

developers to 

work with 

local 

organizations. 
41

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

State 

Program

Program 

Status 

(Launch 

Date)

Program Structure / Capacity Targets 

for LMI Customer Eligibility Incentives and Financing

Outreach and 

Partnerships

Illinois 

Community 

Renewable 

Generation 

Program

In 

development 

(2016)

The Low-Income Community Solar 

Project Initiative provides incentives to 

LMI customers; program will also include 

Low-Income Community Solar Pilot 

Projects. Small subscribers receive an 

adder that anchor tenets do not. 

Not yet determined.

Guaranteed funding 

from ComEd ($10

million/year), plus 

possible additional 

funding from Renewable 

Energy Resources Fund 

(about $160 million). 

37.5% of Solar for All 

funds will subsidize LMI 

customer for community 

solar participation; 

22.5% of funds will go to 

LMI community solar 

pilot projects. 

Legislation 

requires 

program 

developers to 

contract with 

third-party 

program 

administrators 

to interface 

with LMI 

customers, 

Pilot Projects 

program 

requires 

partnership 

with at least 

one 

communitybased 

organization.

Maryland 

Community 

Solar Energy 

Generating 

Systems Pilot 

Program

Pilot (2017)

60 MW carve-out for projects where LMI 

customers own 20% of output; additional 

60 MW carve-out for “small” projects 

including projects with more than 50% 

LMI participation.

LMI customers at or below 

80% of federal poverty line or 

certified as eligible for bill 

assistance from the Maryland 

Office of Home Energy 

Programs. Operators of lowincome housing may apply as 

subscribers.

LMI customers who 

subscribe to community 

solar under an 

ownership model 

receive an incentive of 

$240/kW (compared 

with $80/kW for non-LMI 

customers).

Works with 

existing 

programs 

(Maryland 

Office of 

Home Energy 

Programs). 

Allows for 

direct 

engagement 

with housing 

authorities
42

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

State 

Program

Program 

Status 

(Launch 

Date)

Program Structure / Capacity Targets 

for LMI Customer Eligibility Incentives and Financing

Outreach and 

Partnerships

Massachusetts 

Virtual Net 

Metering

Phasing Out 

(2017)

LMI customers are eligible for low-interest 

financing from the Mass Solar Loan 

program to subsidize community solar 

subscriptions

Income-eligible customers, 

income eligibility begins at 

120% of state median 

income. Following reform to 

net metering in 2017, offsite 

virtual net metering is valued 

at a 40% deduction. 

Interest buy-downs by 

the Massachusetts 

Department of Energy 

Resources.

None.

Solar 

Massachusetts 

Renewable 

Target 

(SMART)

In 

development 

(2017)

1,600 MW declining block net-metering 

program. Community solar serving at 

least 50% low-income customers receives 

an added 6 cents/kWh; low income 

community solar projects less than 25 kW 

will receive 230% of the base 

compensation rate.

Must be subscribed to an R-2 

rate (low income). 

Qualifications for R-2 include 

income below 60% of state 

median, receiving some form 

of benefits, or in public 

housing. 

Low-income subscribers 

receive up to a $0.06 / 

kWh adder.

To be 

determined.

Minnesota 

Community 

Solar Gardens

Active (2014)

Utilities required to submit plans for LMI 

projects. Xcel’s proposal involves 0.5-

MW–1.0-MW dedicated to low-income 

customers at no up-front cost. 

LIHEAP-eligible customers. Xcel’s LMI pilot would 

be free for customers. 

Xcel, CENTS 

Coalition, 

Dayton’s Bluff 

Neighborhood 

Housing 

Association, 

Center for 

Energy and 

Environment.

New Jersey 

Senate Bill 

In 

development 

(2018)

The Board of Public Utilities was directed 

to develop a community solar pilot 

program. The program must provide 

access to LMI customers.

Not yet determined. Not yet determined. Not yet 

determined.
43

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

State 

Program

Program 

Status 

(Launch 

Date)

Program Structure / Capacity Targets 

for LMI Customer Eligibility Incentives and Financing

Outreach and 

Partnerships

New York 

State Energy 

Research and 

Development 

Authority 

(NYSERDA) 

Low Income 

Community 

Solar Initiative

In 

development 

(2017)

NYSERDA is tasked with introducing an 

initiative to provide financial support for 

pilot projects, streamline pre-development 

assistance, and develop LMI credit and 

support mechanisms such as a loan loss 

reserve. 

Generally, those at or below 

60% of the state median 

income, or otherwise qualified 

for the Home Energy 

Assistance Program.

The New York Public 

Service Commission 

backs a proposal to 

allow customers 

receiving bill assistance 

as a credit to apply that 

credit toward a 

community solar 

subscription. 

NYSERDA.

Oregon 

Community 

Solar

In 

development 

(2016)

10% LMI total, comprised of 5% 

requirement for each project, along with 

5% of overall program dedicated to LMIonly projects. 

To be determined. To be determined.

Outreach was 

not mandated 

by legislation.

Rhode Island 

Community 

Remote Net 

Metering

Active (2016)

No specific LMI requirement. Developer 

offtakers required to provide “tangible 

benefits” to their LMI tenants.

Program designed to allow 

affordable housing building 

owners to participate

$200 LMI customer 

acquisition subsidy to 

defray costs (must be

passed through to 

customer)

Rhode Island 

Housing 

involved in 

rulemaking 

process.
44

This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications.

List of Community Solar Developers

Note: This list is not exhaustive and is for informational purposes only. 

Community Solar Only

• Clean Energy Collective 

• Community Solar 

• Soveren Solar 

• Sunshare 

Solar Developers with Community Solar Experience

• Able Energy 

• Ameresco

• Arcadia Power 

• BlueWave

• Community Energy Solar

• Ecoplexus

• IGS Generation

• Innovative Power Systems 

• Nexamp

• Next Step Living

• Novel Energy Solutions 

• NRG 

• Renovus Solar 

• SoCore Energy

• SolarStone

• Solar Synergy

• Spear Point Energy 

• Sundial Solar 

• Sunrise

• Suntility

• Syncarpha

• Tangerine Power

• TruNorth Solar

Low-Income Solar Specialists

• Grid Alternatives 

• Posigen