How Local Governments Can Prepare for New Federal Funding Opportunities for Solar Energy

| By Andrew Light and Zach Greene, World Resources Institute

Communities across the U.S. are excited about clean energy right now, and for good reason: the Environmental Protection Agency’s Greenhouse Gas Reduction Fund (GGRF) presents unprecedented new financing opportunities for solar energy deployment. The GGRF is a massive investment in projects and programs that will put more renewable power on the grid and drive economic development at the local level, particularly in disadvantaged communities that have historically been left out of the clean energy transition. Fortunately, the experts at SolSmart are ready to help local governments prepare for this influx of capital and the local solar projects it will spur.  

The GGRF is made up of three sub-programs: 

  1. The National Clean Investment Fund (NCIF), which delivers $14 billion to national-scale entities with proven clean energy project lending experience; 
  2. The Clean Communities Investment Accelerator (CCIA), delivering $6 billion to local lending institutions to support communities that historically have been unable to access clean energy funding; and 
  3. The Solar for All program, which will provide $7 billion to awarded organizations to support rooftop solar in low-income communities across the country; 

While EPA has announced this massive capital injection, it will be multiple months before any money starts to flow. Still, local governments should immediately start taking steps to ensure their communities can access this funding and accelerate local deployment of solar. 

Local governments can play a significant role in ensuring these funds are used to their full potential, as well as maximizing the number of local recipients and the amount of capital that goes to hardware costs. Further, there are many ways local governments can remove barriers to solar energy deployment in their communities that typically make it more expensive or disallow it completely. One way is to use tools like SolSmart, which is a federally funded, free technical assistance program that can help local governments nationwide review their codes, ordinances, and policies to ensure they are best situated to take advantage of these new funds. 

SolSmart can help local governments identify and reduce the “soft costs” associated with solar development. Soft costs, or the non-hardware costs, represent a significant portion of overall project costs – about 66% for distributed solar – and are unnecessarily inflated in certain communities. These soft costs are tied to navigating issues like complex permitting processes, restrictive zoning ordinance language, and marketing costs. Fortunately, local governments can address these costs through both their internal and external-facing processes. Local governments should reach out to SolSmart staff to access technical assistance and also consider taking the following actions now to address these barriers and capture the influx of capital for solar energy development.

Connect With Community Stakeholders and Align on Priorities 

External and internal stakeholder engagement are critical to local governments successfully enabling community uptake of funding initiatives. For external engagement, local governments should prioritize hearing from community affected by the clean energy transition, especially residents from historically disadvantaged communities, and integrate community feedback and priorities into their strategies. In terms of internal engagement, local government staff should seek to educate colleagues on the funding opportunity presented by the GGRF and align on clean energy priorities across departments and with leadership. Broad engagement can play an important role in ensuring policies and programs reach communities that have historically been left out of the clean energy economy. The SolSmart team can help local governments by supporting them in devising strategies to maximize engagement and developing partnerships with community-based organizations to best identify community priorities.  

Address Solar Energy in Local Zoning Ordinances 

Local zoning ordinances that are overly restrictive or unclear can limit solar energy deployment, whether intentionally or unintentionally. Local governments should ensure their zoning ordinances both define residential rooftop and ground-mounted solar and enable them as by-right accessory uses in all zoning districts (in highly urban communities, ground-mounted solar may continue to be conditional). Unnecessary aesthetic requirements (such as requiring panels to be a certain color or to be hidden from public view), height limits, and setback requirements are all common zoning ordinance challenges that may preclude certain solar installations from moving forward. Achieving precise zoning ordinance language can take time and resources, so it can be helpful to look at model ordinances and at what other local governments have written in their ordinances. Also, local governments can make a quick, short-term fix (especially if a zoning ordinance is silent on solar) by issuing a zoning determination letter that cites solar as a by-right accessory use. The SolSmart team can review local governments’ zoning ordinances and provide guidance on barriers and best practice solutions. 

Review Local Permitting Practices 

In pursuit of transparency, local governments might streamline and publicly share permitting requirements for new solar energy projects. Making the permitting process clearer and easier for installers to follow should reduce errors in submissions, thereby reducing the number of permit applications submitted. To take it a step further, reducing the fees associated with the permitting process can encourage even more solar energy deployment. Certain communities have waived permit fees for residents, which would be particularly impactful for residential installations supported by GGRF funds.  

For local governments looking to expedite permitting processes in an easy, free, and verified way, the federal government has developed SolarAPP+. This free software tool integrates into existing permitting software and instantly and automatically reviews permits, approving them if they meet the required standards. 

Local governments can also increase internal capacity by training permitting and inspection officials on best practices for solar deployment. SolSmart offers both live and recorded trainings for local officials, which will help staff understand the challenges and opportunities related to solar permitting and inspection processes. 

Be a Conduit for Trustworthy Information 

Local governments can provide resources and accurate information to support residents in installing new rooftop and ground-mounted solar projects. For example, providing information on state regulations, local installers , incentives, and other related topics can lower the barrier to entry that many homeowners face when looking to install a new project. Many local governments  use external-facing resources like a solar landing page or host informational sessions to communicate this information to interested residents. Similarly, if a local government has made recent updates to its zoning ordinance or permitting processes, a solar landing page is a good place to highlight the work being done. These relatively low-effort actions can reap big benefits by quickly increasing the knowledge needed among residents to stand up impactful projects that add solar energy to the grid and save money.   

Complement GGRF with Other Funding Streams to Deepen Impact 

Connecting additional funding opportunities with GGRF capital can further reduce the cost of solar energy development and support deeper energy savings. Here are a few additional actions local governments can consider: 

The Key Takeaway 

Local governments are in a unique position to influence solar energy deployment in disadvantaged communities. The influx of GGRF funds and the development of associated projects is happening soon, so now is the time for local governments to ensure their communities are primed for investment. Local governments need to ensure their communities can take advantage of this once-in-a-lifetime opportunity and maximize the local economic development and health benefits that it can support. 

Fortunately, there are plenty of excellent resources available to local governments that need assistance reducing soft costs, finding new ways to fund their priorities, and deploying more solar energy. SolSmart is a free, federally funded technical assistance and designation program that is available to all local governments. SolSmart provides the expertise and capacity that local governments might need as they work to reduce barriers to solar energy deployment and recognizes those that complete necessary criteria with a designation that highlights their commitment to growing the local market for solar. To connect with experts to both learn more about the SolSmart program and jumpstart local action, visit our “Join SolSmart” page today.