1. The current guidance on the IRA’s Low-Income Communities Bonus Credit Program for community solar can be restrictive in its methods for delivering benefits to low-income households.
2. Implementing a direct payment model for financial benefits of community solar can be challenging due to concerns about auditability and potential impacts on eligibility for other assistance programs.
3. Proposed alternative models, such as listing qualified households as community solar beneficiaries and distributing benefits through prepaid cards, aim to address these concerns and make community solar more accessible and beneficial for all Americans.
The third part of an article series on the IRA’s Low-Income Communities Bonus Credit Program for community solar explores the issues of auditability and impacts on low-income assistance program eligibility. Treasury’s rules currently require benefits to be managed through a utility, but utilities often struggle to accurately apply bill credits as expected. Community solar providers are capable of directly distributing the benefits to subscribers and maintaining adequate records for compliance.
There are concerns that direct benefit payments could unintentionally become taxable income, potentially affecting eligibility for programs like SNAP or affordable housing. However, research shows that the amount of benefit received from community solar would likely not disqualify individuals from these programs, as it represents a small percentage of their annual income.
A proposed model suggests redefining low-income households as community solar beneficiaries, who do not enroll directly in the project. Instead, non-low-income households pay for the full value of credits, with the equivalent of 20% savings distributed directly to low-income beneficiaries. This alternative approach aims to mitigate risks to low-income households and ensure they receive the benefits without complications.
Ultimately, flexibility in the rules is necessary to allow for creative solutions to deliver financial benefits to low-income households. The goal is to develop a community solar program that is accessible and beneficial to all Americans, regardless of economic status, location, or historical access to clean energy. With the right guidance and innovative problem-solving, this vision could become a reality.