Solar Shift: Feeding Apartments, Not the Grid

There are always changes in the solar industry. People call the industry, as a joke, the solar coaster, because it’s like a roller coaster ride with new programs and new subsidies coming and going. In 2017, the city came out with the Community Solar program, which was focused on providing energy savings to renters and low- to moderate-income people. The program made it easy for contractors to plug their solar arrays directly into the power grid and then sell credits to people who subscribed to the system, who received 10% in electricity savings.

Changing gears. It was a great program, but in 2021 the city basically said: “We think we’re going to go in a different direction. We’re going to change the subsidies.” Our business is focused on multifamily buildings in the Bronx, Brooklyn, Queens and Upper Manhattan, and we knew that there was a lot of value in the electricity from the solar arrays we were installing on buildings. So now we’ve gone back to an old-school way of feeding solar electricity directly into people’s apartments as opposed to putting it into the grid.

Behind the meter. We’re now installing a solar array at a six-story, 185-unit co-op in the University Heights section of the Bronx. It was built in 1955, so it’s postwar but definitely on the older side. We’re going to be one of the first projects like this in New York City, where, instead of using the Community Solar program, we’re using what we call a behind-the-meter system, feeding the energy directly to people’s electricity loads. But similar to Community Solar, we sell the electricity at a 10% discount of whatever the building’s residents are paying Con Edison. There will be some cases when the solar arrays actually generate more electricity than an individual apartment is using. In that case, the energy is put back into the grid. They call that net metering, and it spins the meter backwards. The Bronx building as a whole, we estimate, will see roughly $7,000 in total reduced electrical costs annually.

A good deal all around. Urban Energy designs the system, pays for it and owns it, so it’s very straightforward. For the co-op, it’s literally just signing a 25-year lease at $10,000 a year and then reaping the benefits. We’re like another tenant living on the roof. First we come in and make sure the roof is in good condition. Then we figure out exactly how many solar panels we can fit, how much weight or attachments we need to put in the roof. At this building, the roof was about 25 to 30 years old, but fortunately there was no moisture trapped underneath, and there wasn’t a ton of work that needed to be done other than adding a new layer of TPO, a white, single-ply roofing membrane that reflects heat instead of absorbing it. And we didn’t need to install any attachments. It’s all weighted down with cinder blocks.

The total cost for us to build the Bronx system is roughly $600,000. There are a lot of rebates and things from the federal, state and city governments that help us subsidize that cost a little bit. We also work with private equity firms and other large infrastructure funds that like the returns on this. It’s roughly a 9% return, so it’s a little bit better than the stock market. 

Grasping the benefits. It’s nice to know that the solar panels are powering your apartment rather than having that energy going into the grid, which feels like more of a virtual experiment. It’s actually a little bit easier to understand when the solar is directly tying into people’s apartments. The challenging thing is when programs change, you want to make sure people fully understand how the deal works. If you can help with that as opposed to just coming in saying, “We want this roof space,” then you’re actually solving a problem.