Rural Renewable Energy Alliance
Report date
December 2018
What has been most instrumental to your progress?
It takes a community to realize a low-income community solar solution. Most instrumental to our success was the constellation of partners and advocates that assembled around our innovative program.
In August 2017, RREAL completed the first Community Solar for Community Action (CS4CA) project, the first 100% low-income solar project in Minnesota and Native Nations. Of the many successful aspects of our project, the innumerable partners that assembled were instrumental to its success. Partners included the Leech Lake Band of Ojibwe Tribal Council, the Leech Lake Energy Assistance Program, Leech Lake Tribal College, Minnesota Power, Leech Lake Division of Resource Management, the Shakopee Mdewakanton Sioux, the Legislative Citizens Commission on Minnesota Resources, and the Department of Energy.
The support for the CS4CA innovation from a variety of partners on the local, state, and federal level is a lasting testament to the fact that the model works and is a supported effective solution that can be integrated even more into the energy assistance program. The work completed throughout this grant process in Minnesota is now helping scale similar projects across the United States.
In August 2017, RREAL completed the first Community Solar for Community Action (CS4CA) project, the first 100% low-income solar project in Minnesota and Native Nations. Of the many successful aspects of our project, the innumerable partners that assembled were instrumental to its success. Partners included the Leech Lake Band of Ojibwe Tribal Council, the Leech Lake Energy Assistance Program, Leech Lake Tribal College, Minnesota Power, Leech Lake Division of Resource Management, the Shakopee Mdewakanton Sioux, the Legislative Citizens Commission on Minnesota Resources, and the Department of Energy.
The support for the CS4CA innovation from a variety of partners on the local, state, and federal level is a lasting testament to the fact that the model works and is a supported effective solution that can be integrated even more into the energy assistance program. The work completed throughout this grant process in Minnesota is now helping scale similar projects across the United States.
Also instrumental to our success during the grant period was RREAL’s concurrent participation in the Department of Energy’s Solar in Your Community Challenge, a national challenge designed to vet low-income solar models. The Department of Energy selected 178 teams spanning 40 states, the District of Columbia, Guam, and Puerto Rico to identify innovative approaches to support solar deployment in underserved communities. Over the 18-month challenge, RREAL’s team met our goal of completing seven projects that serve 100% low-income populations and deployed 252 kW of solar power. Projects developed during this time will serve a total of 128 households per year for at least 25 years. In addition, three community action agencies, their employees, and visitors were educated about community solar and its benefits in mitigating energy poverty and reducing greenhouse gas emissions.
Participation in the Department of Energy Challenge further elevated our conversation to the national stage and was instrumental in the project’s success.
Participation in the Department of Energy Challenge further elevated our conversation to the national stage and was instrumental in the project’s success.
RREAL is particularly proud of fostering an inclusive solar workforce during the grant period. As part of the Leech Lake CS4CA partnership, RREAL hired interns from the Leech Lake Tribal College to be an integral part of our installation team. The training allowed the students to obtain the training and the entry level certification required by the State of Minnesota to be on a solar job site. After the training, we hired one of the students, and he has become an essential part of our team as a full-time site supervisor.
The training is part of a broader effort to create an inclusive clean energy workforce in Minnesota and the United States. In 2017, clean energy employed 59,079 Minnesotans, and those opportunities are projected to grow at about 4.6% within the next year. As the need for more workers in the clean energy economy increases, so does the opportunity for affordable paying jobs. RREAL has been part of creating an inclusive workforce in Central Minnesota and will continue to as clean energy grows. This aspect of our work was instrumental to our success and that success is enhanced every day when our trainees arrive to the job sites to pay it forward.
The training is part of a broader effort to create an inclusive clean energy workforce in Minnesota and the United States. In 2017, clean energy employed 59,079 Minnesotans, and those opportunities are projected to grow at about 4.6% within the next year. As the need for more workers in the clean energy economy increases, so does the opportunity for affordable paying jobs. RREAL has been part of creating an inclusive workforce in Central Minnesota and will continue to as clean energy grows. This aspect of our work was instrumental to our success and that success is enhanced every day when our trainees arrive to the job sites to pay it forward.
Key lessons learned
Since RREAL’s inception in 2000, we have integrated solar energy into the federal Low-Income Home Energy Assistance Program (LIHEAP). Although LIHEAP provides a necessary service of paying low-income families’ energy bills, a stopgap is not a solution. Integrating solar into the energy assistance program, however, offers a fiscally responsible, environmentally appropriate solution and long-term solution to energy poverty.
As we scale CS4CA, we learn more about LIHEAP funding volatility that affects the number of families served and the staff who work directly with families in need. According to the LIHEAP Clearinghouse, the FY2018 program was funded at $3.64 billion, compared to $5.1 billion in FY2010. The 2018 report also indicated that the President’s FY2019 budget proposed to eliminate funding LIHEAP. In Minnesota, LIHEAP only serves 20% of eligible customers.
This world of federal funding scarcity makes it difficult to introduce an innovative new approach. However, as fewer families continue to be served by LIHEAP each year, the CS4CA model offers predictable electricity production, enabling agencies extended capacity to reach more people over time.
As we scale CS4CA, we learn more about LIHEAP funding volatility that affects the number of families served and the staff who work directly with families in need. According to the LIHEAP Clearinghouse, the FY2018 program was funded at $3.64 billion, compared to $5.1 billion in FY2010. The 2018 report also indicated that the President’s FY2019 budget proposed to eliminate funding LIHEAP. In Minnesota, LIHEAP only serves 20% of eligible customers.
This world of federal funding scarcity makes it difficult to introduce an innovative new approach. However, as fewer families continue to be served by LIHEAP each year, the CS4CA model offers predictable electricity production, enabling agencies extended capacity to reach more people over time.
The installation of the CS4CA model in partnership with the Leech Lake Nation was, at times, difficult because of utility obstructionism.
There are 173 electric utilities in Minnesota and 5 utilities serving the Leech Lake Nation. RREAL and the Leech Lake partners chose to work with the utilities that served the greatest number of people, one of which was a rural electric cooperative.
In Minnesota, cooperative utilities have fewer regulations than investor owned utilities. There was stiff resistance from the utility in providing virtual net metering, a mechanism that distributes the financial benefits of the community solar array to individual families. Because of the blockade from the utility, RREAL developed a work around CS4CA model that still serves families that qualify for energy assistance.
The work around model built five scattered arrays and an energy trust between the array host sites. The trust ensures that the savings from the solar array go back in to the Leech Lake energy assistance program to serve more families.
Initially this setback seemed like a failure, but ultimately it helped us forge an approach that can work in unfavorable regulatory ecosystems.
There are 173 electric utilities in Minnesota and 5 utilities serving the Leech Lake Nation. RREAL and the Leech Lake partners chose to work with the utilities that served the greatest number of people, one of which was a rural electric cooperative.
In Minnesota, cooperative utilities have fewer regulations than investor owned utilities. There was stiff resistance from the utility in providing virtual net metering, a mechanism that distributes the financial benefits of the community solar array to individual families. Because of the blockade from the utility, RREAL developed a work around CS4CA model that still serves families that qualify for energy assistance.
The work around model built five scattered arrays and an energy trust between the array host sites. The trust ensures that the savings from the solar array go back in to the Leech Lake energy assistance program to serve more families.
Initially this setback seemed like a failure, but ultimately it helped us forge an approach that can work in unfavorable regulatory ecosystems.
RREAL has also learned that we must develop a project finance mechanism that is not based on contributed income or philanthropy to scale our service delivery innovation. Although we have demonstrated the efficacy of integrating solar into the federal energy assistance program, we have yet to achieve a long-term sustainable finance mechanism.
Because RREAL continues to demonstrate an innovation within a state and federal social service delivery program, we believe that Pay for Success (aka Pay for Performance and/or Social Impact Bonding) is well suited to further scale and elevate our model. Pay for Success financing is a market-based approach to financing projects designed to help existing public programs evolve and de-risk innovation in the public sector. Going forward, RREAL will invest in the development of a Pay for Success financed CS4CA project. Pay for Success financing is a near term opportunity that promotes a sustainable, scalable solution of community solar into energy assistance programs. RREAL is developing a performance-based finance mechanism that provides low-cost, locally produced, and community owned solar energy assets for the benefit of low-income populations
Because RREAL continues to demonstrate an innovation within a state and federal social service delivery program, we believe that Pay for Success (aka Pay for Performance and/or Social Impact Bonding) is well suited to further scale and elevate our model. Pay for Success financing is a market-based approach to financing projects designed to help existing public programs evolve and de-risk innovation in the public sector. Going forward, RREAL will invest in the development of a Pay for Success financed CS4CA project. Pay for Success financing is a near term opportunity that promotes a sustainable, scalable solution of community solar into energy assistance programs. RREAL is developing a performance-based finance mechanism that provides low-cost, locally produced, and community owned solar energy assets for the benefit of low-income populations
Reflections on the community innovation process
The three gears working in unison identify three components that were essential to getting our work completed. These CS4CA projects require inclusivity and collaboration to be successful. The many stakeholders from the communities served made the model a valuable community asset and raised awareness of the pressing issue of energy poverty. Through the guidance and collaboration with the Leech Lake Band of Ojibwe Council, Division of Resource Management, and Housing, the Leech Lake project was able to include and benefit many people. These three gears worked in tandem to make the innovation happen and will continue to be an essential part of the CS4CA innovation.
Progress toward an innovation
Our innovation is a significant breakthrough in our nation’s approach to supporting the well-being of low our low-income communities. Rather than simply paying for families’ energy bills, we are proving that solar energy can provide energy assistance, or solar assistance, for decades. Our work is already spreading nationwide!
To continue to integrate CS4CA into the federal energy assistance program, RREAL is working to scale the model with the Pay for Success (PFS) funding mechanism. This financing tool allows an investor to provide upfront capital for an innovation like CS4CA. If the model proves it serves more people, a unit of government pays back the investor and ideally embraces the innovation.
In February 2018, Congress enacted the Social Impact Partnerships to Pay for Results Act (SIPPRA), creating a $100 million standing fund within the U.S. Department of the Treasury that allows the federal government to serve as the end payor for PFS projects in state and local governments (Urban Institute, July 2018). RREAL is working to initiate a Pay for Success innovation in Minnesota to take the next step in serving more families through the energy assistance program.
To continue to integrate CS4CA into the federal energy assistance program, RREAL is working to scale the model with the Pay for Success (PFS) funding mechanism. This financing tool allows an investor to provide upfront capital for an innovation like CS4CA. If the model proves it serves more people, a unit of government pays back the investor and ideally embraces the innovation.
In February 2018, Congress enacted the Social Impact Partnerships to Pay for Results Act (SIPPRA), creating a $100 million standing fund within the U.S. Department of the Treasury that allows the federal government to serve as the end payor for PFS projects in state and local governments (Urban Institute, July 2018). RREAL is working to initiate a Pay for Success innovation in Minnesota to take the next step in serving more families through the energy assistance program.
What it will take to reach an innovation?
NA
What's next?
We intend to license and supervise CS4CA projects by other developers to advance this Minnesota made, nationally scalable model.
The CS4CA team is negotiating its two-year project development pipeline as:
• In progress and fully funded: 2019 Vermont SEVCA CS4CA—will serve 50 families through on-bill credits.
• In progress and fully funded: 2019 Minnesota White Earth Nation CS4CA Minnesota—will serve 100 households in partnership with the energy assistance provider.
• 2019 Minnesota Tri-County CS4CA –proposed 20 kW community solar array that will serve 10 low-income families with weatherized homes through MN Power on-bill credits.
• 2020 Minnesota Itasca Clean Energy Team CS4CA - potential 20% low-income carve out in a proposed community solar project in Itasca County. Could serve 200 low-income families.
• 2020 Kansas City CS4CA –will serve at least 100 households with low-income carve out or new array.
• 2020 Missouri Community Action Partners CS4CA –a proposal to develop 1MW of solar to serve 200 families by the end of 2020.
• 2020 Vermont CS4CA –potentially serve 200 families and expand RREAL’s partnerships in Vermont
The CS4CA team is negotiating its two-year project development pipeline as:
• In progress and fully funded: 2019 Vermont SEVCA CS4CA—will serve 50 families through on-bill credits.
• In progress and fully funded: 2019 Minnesota White Earth Nation CS4CA Minnesota—will serve 100 households in partnership with the energy assistance provider.
• 2019 Minnesota Tri-County CS4CA –proposed 20 kW community solar array that will serve 10 low-income families with weatherized homes through MN Power on-bill credits.
• 2020 Minnesota Itasca Clean Energy Team CS4CA - potential 20% low-income carve out in a proposed community solar project in Itasca County. Could serve 200 low-income families.
• 2020 Kansas City CS4CA –will serve at least 100 households with low-income carve out or new array.
• 2020 Missouri Community Action Partners CS4CA –a proposal to develop 1MW of solar to serve 200 families by the end of 2020.
• 2020 Vermont CS4CA –potentially serve 200 families and expand RREAL’s partnerships in Vermont
If you could do it all over again...
The biggest piece of advice we would give ourselves is to focus on the strong partnerships to prove the model.
One of the most difficult and time intensive parts of the CS4CA model was working to convince key players to participate in the model. The rural electric cooperative RREAL worked with to connect the Leech Lake project was resistant to distribute virtual net metering credits to serve individual low-income families. Similarly, the Minnesota Department of Commerce has not supported innovation and the use of LIHEAP dollars to serve more families. The RREAL crew spent a lot of time trying to make agreements work with the electric cooperative and the Department of Commerce. In the end, the agreements were not successful, but we were still able to implement the project through our partnerships with the local community. RREAL instead built five scattered arrays with a trust agreement and proved CS4CA is an empowering project despite the work around model approach. RREAL is now working to market the CS4CA model more to have a broader reach to more policymakers, partners, and the general public, but our advice to ourselves would have been not to bother with the calcified entities.
One of the most difficult and time intensive parts of the CS4CA model was working to convince key players to participate in the model. The rural electric cooperative RREAL worked with to connect the Leech Lake project was resistant to distribute virtual net metering credits to serve individual low-income families. Similarly, the Minnesota Department of Commerce has not supported innovation and the use of LIHEAP dollars to serve more families. The RREAL crew spent a lot of time trying to make agreements work with the electric cooperative and the Department of Commerce. In the end, the agreements were not successful, but we were still able to implement the project through our partnerships with the local community. RREAL instead built five scattered arrays with a trust agreement and proved CS4CA is an empowering project despite the work around model approach. RREAL is now working to market the CS4CA model more to have a broader reach to more policymakers, partners, and the general public, but our advice to ourselves would have been not to bother with the calcified entities.
One last thought
If our society actually wants to make a transition to a clean energy economy, we must be intentional about ensuring that solar energy and other renewable technologies are equally available to low-income communities. If we do not, we won’t be able to make an energy transition to a 100% renewable, equitable future. Our work is an important part of ensuring that the innumerable benefits of solar energy and the clean energy workforce are equally available to low-income communities. We can scale low-income solar overnight, nationwide if we do so in partnership with the national energy assistance program. Let’s avoid a Renewable Divide and create equal access to solar by the national integration of solar into the federal energy assistance program. Together, we have the power to make a difference.