Protecting communities from HUD overregulation

Posted by Bennett Hanson on Oct 28, 2021 9:27:32 PM

Navigating constantly evolving regulations can be a pain, but SaveSolar has a stellar track record of doing just that. In fact, we recently discovered a problem of overlapping regulations that could cost residents of affordable housing communities who are receiving the benefits of community solar, potentially causing them to get their benefits cut or be forced to pay money back to HUD (the U.S. Department of Housing and Urban Development).

With the help of Steve Morgan from Clean Energy Solutions, we drafted a memo  (available for download below) offering a clear and detailed explanation of the issue, along with a few workarounds for regulators – all of which protect the interests and benefits of affordable housing communities. Though the example we cite comes from our experience with Washington, D.C.'s community solar program, the argument applies to most solar programs nationwide that participate with HUD.

Essentially, the problem is this: community solar offers affordable housing residents savings on their electricity bills (great, right?!), but, this means that HUD can 1) reduce the amount of utility allowances it gives to tenants, or 2) HUD could treat those energy savings as income, effectively raising the rent on assisted housing properties. Neither is acceptable.

This is all due to HUD’s current interpretation of regulations addressing utility allowances (or cash benefits to pay for low-income households' utility bills), which says that any benefit from a solar credit or tariff that lowers the tenant utility bill must be 100% offset by an increase in tenant rent. We at SaveSolar find this interpretation to be contrary to both precedent and statutory language, and, frankly, just arbitrary and logically backwards. (Importantly, we did find one exception to this HUD interpretation in the California multi-family solar program known as SOMAH.) For more on SOMAH, enter your email below to download our memo.

HUD’s choice to shift the debt burden of energy savings onto landlords and tenants of affordable housing communities only lessens the chance that they will participate in solar programs. As of 2018, only an estimated 4-8% of low-income households have participated in solar programs, despite the growth in community solar which sets money aside for low-income earners.

If the United States is really going to cut its greenhouse gas emissions in half by 2030, solar panels need to be on as many roofs as possible, and HUD regulations need to make that easier, not more difficult.


About SaveSolar

SaveSolar is a Washington, D.C.-based organization that specializes in developing community solar assets. We work with building owners to finance and build solar assets, to compensate owners with long-term revenue and to generate solar energy back into the utility. This energy is then provided at a discount to residential, low-income and community subscribers. Our mission is to help our district reach its renewable energy goals and to lower the cost of electricity.

The SaveSolar executive leadership team has over 60 years of combined experience in renewable energy markets in Canada, Australia, New Zealand and the U.S. We have diversified experience across construction, finance, project management, technology and sustainability. Our expertise spans numerous countries that have previously established renewable energy programs.

If you would like to contact SaveSolar to discuss a project, please visit Rooftop Solar Lease - SaveSolar | Leasing Rooftops From Property Owners to book an appointment, or call us at (202) 846-6928 to speak to one of our Community Project Specialists.

Topics: Community Solar, Solar for All, DC Solar, SaveSolar