9. Ensuring Benefits to Lower Income Households

Section 2866(d) requires that low-income households benefit from the installation of SWH. Specifically, the statute states:

The commission shall ensure that lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (c), ratepayers participating in a LIEE program, that receive gas service at residential housing with a solar water heating system receiving incentives pursuant to subdivision (a), benefit from the installation of the solar water heating systems through reduced or lowered energy costs.

In the case of single-family households, it is likely that the household will have a dedicated natural gas meter and that the family will pay a separate utility bill. Thus, the benefits of the SWH installation should to flow to the household through reduced natural gas consumption.

In the case of multifamily housing, SWH is usually installed on multifamily buildings where hot water to the apartments is provided by a central boiler, and tenants are unlikely to pay a separate natural gas bill for hot water. In this scenario, the cost of natural gas for water heating is incorporated into the monthly rent, and monthly rent charges are often dictated by Section 8 of the United States Housing Act of 1937. Building owners who invest in a SWH system will most likely want to recoup the original cost of the investment in the SWH system, which makes it challenging for the Commission to ensure sharing of SWH benefits between building owners and lower-income residents.

In order to comply with Section 2866(d), we will require that where an applicant for low-income SWH incentives intends to install a SWH system on a multifamily property, the relevant PA shall obtain an affidavit from the applicant explaining how the applicant will pass reduced energy costs to qualifying lower-income residents.