A Boston Nonprofit is Bringing Community-Owned Solar Power — and Profit — to Low-Income Neighborhoods
By Kana Ruhalter and Arun Rath April 15, 2024
Craig LeMoult WGBH News
On this week’s edition of the Joy Beat, we’re celebrating the work of the Boston Community Solar Cooperative. Their plan is to place a solar project on the roof of the Dorchester Food Co-op and launch a community-owned solar cooperative.
Advocates say this will bring energy equity to Boston’s low-income and historically disadvantaged communities, all while reducing carbon emissions. Greg King, co-founder of the co-op and interim president of the board, joined GBH’s All Things Considered host Arun Rath to discuss the company’s vision for a clean and equitable future. What follows is a lightly edited transcript of their conversation.
Arun Rath: Before we dive into the Boston Community Solar Cooperative’s plans in Dorchester specifically, give us a bit more background about the roots of the community solar movement and how this approach works for low-income communities.
Greg King: Community solar, as a concept, has been around for probably a little over 15 years. The idea behind community-owned solar was that many households or renters may not have locations that are suitable for installing a solar array on a rooftop, so community solar was born out of the idea that we could have a solar system somewhere on the grid, and people who use [its] power somewhere else on the grid.
At the Boston Community Solar Cooperative, we are creating what we refer to as a “community solar 2.0 model.” This is a model where, in addition to trying to provide the environmental benefit of clean energy — meaning lower costs, no fossil fuel use to generate power — we’re also trying to help communities with the wealth gap by having members of communities actually own the solar arrays that are used to generate power.
At the Boston Community Solar Cooperative, we see a future powered by the sun and owned by the community.
Rath: Tell us about how the organization came together.
King: Our organization was organized just after the Inflation Reduction Act was passed, about 15 months ago. As you’re probably aware, as part of the Investing in America agenda, the Biden administration put forward a very sweeping clean energy initiative that used grant money as well as tax incentives to attract private investment.
There are some provisions in the IRA that made the type of model that we have been working on possible. The biggest single part of that is the investment tax credit for solar [that] was extended and increased. In addition, there were bonus ITC credits that were created that would incentivize development in low-to-moderate income communities to encourage people to use domestically sourced products, and for programs or projects to support prevailing wage and pre-apprentice programs.
The breakthrough was the ability for an organization like ourselves to be qualified for those tax credits and then be able to monetize them by selling them. Prior to this era, if you used what we call tax equity financing — meaning you sold your tax credit to a high net-worth individual who could use the tax credit to reduce their income — that person who purchased the tax credit had to own the asset for five years. Under the IRA, that goes away, so we can actually finance projects using tax credits that we can qualify up to 60% of the project cost for.
That gives us a new tool to be able to finance projects. It’s literally free money.
Rath: Brilliant. Give us a sense of the long-term vision with this “community solar 2.0.” You’ve talked about how this is about building wealth in low-income communities. How long will that take to happen and grow?
King: The Boston Community Solar Cooperative was really formed around the idea of developing rooftop solar in urban environments solely in Boston, with the idea that the cooperative as a development entity would own and operate the solar array, and would leverage these creative financing solutions around tax credit monetization and develop multiple projects.
As part of that effort, we would be able to bring members — both workers and subscribers and investors — into the co-op and be able to share profits. At Community Solar, our goal is to distribute all of our profits to our members as passive income, not just to pay for energy but for housing, food and education.
Of course, every day the sun shines, we make money through the sale of electricity. The more solar panels we have, the more revenue we generate and the more passive income generated for our members.
Rath: How unusual is this? It seems remarkable — people who are not homeowners are able to actually share in the benefits of solar in a way that more affluent people can.
King: Yeah, this is a pretty unique model, insomuch that it was born of the IRA. It wasn’t possible before because, again, solar development is quite labor-intensive. Typically, if you wanted to do a megawatt of solar capacity, you’re talking somewhere near $2 million, give or take, for purchasing panels, inverters and meters.
But once you’ve built it, and there’s a ray of sunshine, you generate electricity. Between the incentives that we received to help with the revenue and the tax credit, we can monetize, and we’ve created a unique model.
It certainly works very well here in Massachusetts, and we believe it’s a game changer. We’re going to need a lot of new solar generation to support decarbonizing buildings, electrification, transportation and [to] reduce our reliance on fossil fuels. This is a unique opportunity for communities that use the power and actually own the sources of power in a distributed energy future that is made possible by modern technology.
Rath: You talked about how you got the idea for the Boston Solar Cooperative’s plans, but I want to know more [about] what inspired it. What inspires you and your colleagues to do this work?
King: What inspires me is the reality of the energy system transition. McKinsey put out a report a little over a year ago that says it’s going to take 265 trillion in capital to decarbonize. With that reality of a need to transition our energy systems off of fossil fuels and onto renewable sources, there’s this tremendous economic development opportunity.
What motivates us — Boston Community Solar — is the idea of being able to create a community-centric development process; to have a development entity that is owned and operated by community members and to have income and profits that can be used for other purposes, like education and housing.
We have a big racial wealth gap here in Boston, so a lot of our work is focused on those communities that have suffered the most. We believe there is a great opportunity for those communities to be uplifted by this energy system transition. All the investment, both private and public, is going to be used to save our planet.
[When] you look at the news every day, the weather conditions around the country become increasingly extreme. This is no accident. This is a result of us pouring lots of CO2 into the atmosphere and not expecting [it] to change the chemistry of the atmosphere. The atmosphere is changing, and with it [come] some of the worst consequences.
So we are trying to create a movement. We’re hoping that other organizations around the country learn about what we’re doing and emulate what we’re doing because we think it’s the wave of the future. We’re going to have a whole new energy system landscape — why can’t the community own it?