Community-Driven Solar Investments Bring Clean Power to Underserved Neighborhoods

The nonprofit solar provider RE-volv recently closed a $3 million investment to finance solar installations at nonprofit organizations in underserved neighborhoods across the U.S. The investment from the Kresge Foundation and the Schmidt Family Foundation builds on RE-volv's recent contract with the U.S. Department of Energy to help BIPOC (Black, Indigenous and people of color)-led houses of worship go solar. 

A pay-it-forward solar model for nonprofits 

RE-volv is based on a pay-it-forward model for solar energy. Nonprofits can make the switch to rooftop solar with long-term financing and no upfront cost, saving 15 percent or more on their energy bills right away. When these organizations make payments on their panels, RE-volv  reinvests the money into its Solar Seed Fund — which backs more solar projects in more communities across the country, creating what it calls a "revolving fund for solar energy that continually perpetuates itself." 

"Nonprofits provide vital services in the U.S. — from affordable housing to health care, from addressing food insecurity to providing education and job training," Andreas Karelas, founder and executive director of RE-volv, told TriplePundit. "Whatever the charitable mission of the organization may be, nonprofits spend a large percentage of their budget on operational costs like keeping the lights on. By saving them money on their electricity bills through solar, nonprofits are able to put that money back into their mission, better serving their constituents."

RE-volv has installed over 3.5 megawatts of solar capacity for more than 50 community-based nonprofits across 14 states over the past decade, saving these organizations $20 million collectively on their energy bills.

While it's able to solarize nonprofits anywhere in the country, its focus areas for the new investment include communities in New York, New Jersey and Massachusetts, as well as a push to reach nonprofits in California before a rule change on April 14 will limit savings for customers, Karelas said. RE-volv also works with university students across the country through its Solar Ambassador Fellowship Program, "who are looking for projects to spearhead in their areas," he told us. They'll get some help from new mapping tools developed in partnership with the National Renewable Energy Laboratory, which identify areas and communities where solar projects will have the most meaningful positive impact.

"In particular we prioritize bringing solar to communities where solar is less common, with the goal of accelerating local solar adoption rates," Karelas explained. "With each new project, the Solar Seed Fund is able to provide more nonprofits with solar — planting additional seeds for solar in communities across the country." 

RE-volv's solar finance model is unique in that it exclusively serves nonprofits, but it's not the only way funders are looking to bring clean power to communities that are traditionally underserved. The Kresge Foundation's investment in RE-volv, for example, is part of a broader $7 million package aimed at boosting solar capacity in neighborhoods of color across the country. That includes another $1.1 million to bring community solar to environmental justice groups and affordable housing developments through the Working Power Impact Fund, one of many new community solar deals to hit the U.S. over the past year. 

“Climate change overburdens people of color and low-wealth communities, which are more likely to face power affordability issues, experience intermittent power loss, and live adjacent to polluting energy sources that impact health,” said Joe Evans, portfolio director and social investment officer at the Kresge Foundation, in a statement. “Investing into community-serving nonprofits ensures the benefits of solar will meet communities where the need is greatest.”

Community solar is on the rise

As the name implies, community solar installations are shared by multiple local subscribers, who each receive credit on their energy bills for their share of the power the panels generate. It's a model with vast potential to bring clean energy access to those who can't afford it on their own or who live in parts of the country that are traditionally overlooked and undeserved. 

While the number of new community solar installations dipped in 2022, this model is projected to grow rapidly, with at least 6 gigawatts of new capacity expected to come online over the next five years. 

The Community Power Accelerator Prize, a $10 million competition announced by the Department of Energy in January to increase the development of community solar projects in underrepresented communities, will offer a welcome boost. Designed to "fast-track the efforts" of emerging community solar developers, the prize is part of the DOE's broader Community Power Accelerator that connects developers, investors, philanthropists and community groups to get more community solar projects online.

In total, the DOE aims to enable enough community solar to power the equivalent of 5 million households and create $1 billion in energy savings by 2025 through its National Community Solar Partnership.

“Community solar is one of the most powerful tools we have to provide affordable solar energy to all American households, regardless of whether they own a home or have a roof suitable for solar panels,” Energy Secretary Jennifer M. Granholm said in a statement announcing the Community Solar Partnership back in 2021. “Achieving these ambitious targets will lead to meaningful energy cost savings, create jobs in these communities, and make our clean energy transition more equitable.”

Tax credits included in the Inflation Reduction Act of 2022 will address many of the funding roadblocks that hold community solar back — and there's already growing interest at the state level. States including Illinois, Maryland, Washington, New Hampshire and New Mexico enacted new laws last year to enable community solar development, and the call for proposals on New Mexico's program has already yielded over 400 applications for new community solar projects. 

Image credit: Los Muertes Crew/Pexels