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How California Is Pioneering ‘Energy Justice’

California’s cap-and-trade program raises billions, and some of that money is helping the state’s disadvantaged communities

Newly installed carport solar arrays will soon be providing electricity to the low-income residents of the Casas de la Viña complex in California's Central Valley. (Photo credit: The Association for Energy Affordability)

Diana Guzman, a 30-year-old widow, works in a peach packing plant in California’s Central Valley. She lives with her two children at Casas de la Viña, a nonprofit housing development for farmworkers in an agricultural region buffeted by poverty and some of the nation’s most polluted air.

Not long ago, the family lived in a drafty, dilapidated ranch building rife with mold and insects. Now, they reside in one of the country’s first farmworker housing projects to achieve zero net energy.

The improvements to the complex have included energy-efficient heat-pump water heaters, low-e windows, and futuristic-looking solar carports that produce power for the development. The extensive retrofits are the result of a novel and far-reaching set of state laws that require 35% of California’s cap-and-trade auction proceeds to be spent on clean energy projects in disadvantaged communities and low-income neighborhoods.

For Guzman, whose husband was hit by a car en route to the fields, the energy improvements have taken some of the struggle out of life, reducing her monthly utility bill by 75%. The savings provide money for school supplies for her kids, clothes, and the occasional family night out at the local pizza parlor. “It makes it possible for me to make it alone,” she says.

The idea of using funds from greenhouse gas cap-and-trade auctions to address energy inequality — what advocates call “energy justice” — is not solely the province of California. Auction proceeds from the Regional Greenhouse Gas Initiative, a coalition of nine Eastern U.S. states, also support programs that help low-income residents with their energy bills.

But while California Governor Jerry Brown has made headlines as President Trump’s resister-in-chief on climate change, his state has also taken the lead on a lesser-known front: confronting the interwoven issues of poverty and pollution by funneling hundreds of millions of cap-and-trade dollars into bringing free renewable energy, energy efficient upgrades, and technical assistance to the dwellings of its most vulnerable citizens.

The target is low-income multifamily rentals

The main vehicle so far has been the $38 million Low-Income Weatherization Program (LIWP), which the state estimates has reduced energy use by an average of 44% for those participating since the initiative began in 2016. LIWP’s initial focus has been on the places where the vast majority of poor people live — low-income multifamily rental properties like Casas de la Viña.

Home to 56 farmworker families, Casas de la Viña is located in an isolated rural community surrounded by fields where overcrowded and substandard housing has been the norm. The project was developed by Self-Help Enterprises, a nonprofit organization that specializes in affordable housing in the Central Valley, an agricultural stronghold in the state’s midsection where cap-and-trade is not infrequently viewed as a conceit of coastal elites.

Working with the Association for Energy Affordability, a nonprofit energy service provider, Casas de la Viña upgraded its hot water systems, put in interior and exterior LED lighting, replaced old refrigerators and faucets, sealed ductwork, installed heat-pump water heaters (which are about three times as efficient as the old models), and a host of other improvements. Later this month, five carport PV solar arrays will begin generating electricity for residents’ units and the common areas.

“It was the first time we could have someone look holistically at energy consumption in a project,” says Tom Collishaw, Self-Help’s president and CEO.

Energy burden for low income families is higher

In a 2016 study, the American Council for an Energy-Efficient Economy, a nonprofit policy and advocacy organization, found that low-income households, particularly among African Americans and Latinos, pay more for utilities per square foot than the average household — by some estimates triple the rate. This can trigger tough choices about whether to “heat or eat,” advocates say.

Though California recently became, to much fanfare, the first state to require all new homes to have solar power, the move seems unlikely to bridge the green divide — particularly in communities of color.

Energy insecurity for the poor is tethered to numerous structural barriers, including low home ownership rates, limited disposable income, and shoddy and energy inefficient housing conditions.

In high poverty areas, houses can become financially difficult to maintain and thus deteriorate, exposing occupants to a variety of negative health impacts. Improper ventilation, heating, and cooling can affect indoor air quality, giving rise to moisture, mold, mildew, and a variety of pests that can exacerbate respiratory diseases such as asthma.

Living in drafty, poorly insulated spaces also makes children and other sensitive people more susceptible to air pollution, especially in areas like the Central Valley, which has some of the nation’s worst air quality. Simple changes – the use of an air conditioner instead of an evaporative “swamp” cooler, for instance — also help protect residents from extreme heat events that are likely to be more frequent and more intense due to climate change, according to the California Department of Public Health.

Cape-and-trade raises $6.5 billion

Since taking effect in 2013, California’s cap-and-trade program has raised more than $6.5 billion, and it is now the fourth largest in the world (the European Union’s program is the largest). To further California’s goal of reducing greenhouse gas emissions to 40% below 1990 levels by 2030, state law directs 35% of greenhouse gas auction proceeds to benefit low-income neighborhoods and disadvantaged communities.

To identify those communities, the state Environmental Protection Agency developed a public mapping tool called the Cal EnviroScreen, which scores each of the state’s 8,000 census tracts based on environmental and socioeconomic indicators, including pesticide use, contaminated drinking water, and educational levels. There are currently 2,007 designated disadvantaged communities (known as “DACs”), where cap-and-trade investments have ranged from rebates on electric vehicles to subsidizing fleets of electric rural school buses.

These initiatives serve to “democratize climate policies and benefits,” says Ethan Elkind, director of the climate program at the Center for Law, Energy & the Environment at the University of California Berkeley School of Law. “Energy efficiency is really the first step we should be taking, so investment in these programs makes sense.”

Trust is still an issue

Still, there are plenty of challenges in implementing LIWP projects on the ground, not the least of which is gaining the trust of the population the cap-and-trade dollars are intended to serve.

A case in point is the single-family weatherization program in East Palo Alto, a heavily Latino city with a poverty rate of 16.6% that is a mere 2.5 miles from Facebook’s Frank Gehry-designed Silicon Valley headquarters.

“It’s ‘am I going to get a bill?’” says Joaquin Narvaez, a home repair manager with the community organization El Concilio of San Mateo County, which is partnering with experts from Build It Green, the nonprofit organization that administers LIWP in East Palo Alto. “We have to assure people that this is on the up and up.”

The process begins with an energy model of each house, which helps calculate whether the potential energy savings will justify the state’s investment. Education is a major component. “Behavior is a big part of energy efficiency,” notes Russell Bayba, a Build It Green project manager.

Two-thirds of East Palo Alto’s 28,000 residents are immigrants, both legal and undocumented. In some sections of the city, the Bay Area’s tight housing market has led to the unpermitted conversion of garages and attics into rooms, which makes assessing energy needs tougher.

“We’ve had families say ‘no’ to solar the day before installation because there were people living in the garage,” notes Violet Saena, communities program manager for Acterra, an environmental nonprofit in Palo Alto. “It’s become a problem for our work.” The national immigration crackdown, Saena says, “has added another layer of fear.”

Franciel Branch, a 78-year-old widow, found out about the program through her church. “I’d heard about solar on the TV but wasn’t interested because I couldn’t afford it,” Branch says. Through LIWP, she has gotten an energy-efficient refrigerator, new lighting, and – thanks to a group of Habitat for Humanity volunteers – will soon have a new roof that can accommodate photovoltaics and a solar hot water heater.

Solar PV systems for multifamily affordable housing in California will get a boost when a program approved by the state Public Utilities Commission goes online later this year. The program will provide $100 million in annual rebates – a whopping $1 billion over 10 years — that will allow low-income apartment tenants, in addition to property owners, to directly benefit.

Help for low-income people in the East

On the East Coast, some of the nine New England and Mid-Atlantic states that are part of the Regional Greenhouse Gas Initiative (RGGI) are also using cap-and-trade auction proceeds to assist low-income residents and communities.

According to Ben Grumbles, Maryland’s Environmental Secretary and the RGGI’s chairman, each state has discretion over how the money is spent and “determines how to define environmental and energy justice.”

In Delaware, for example, 15% of RGGI proceeds support low-income weatherization and provide heating bill assistance to low-income households. In Maryland, half the RGGI revenue goes to grants helping eligible residents pay their monthly electricity bills. New York’s Affordable Solar program offers extra solar installation incentives to those earning 80% or less of area median income.

Last year, RGGI, which was founded in 2009, tightened its cap on power plant emissions through 2030, which is expected to increase its auction revenue. The Natural Resources Defense Council and other environmental groups are urging that more of that money be directed to clean energy programs in low-income communities.

In California, where LIWP and other programs are subject to renewal by legislators, the most passionate advocates may be people like Jean Soares, who lives in North Richmond, a Bay Area community long plagued by poverty and toxic industrial emissions.

Soares and his wife Giovana Sargi, a house cleaner, “couldn’t afford 30 grand” to put in solar on the new house he built, he says, so he began searching for grants. He eventually connected with GRID Alternatives, a nonprofit that installs solar panels for LIWP.

The energy savings have inspired the couple to purchase an electric car, which they charge at home for free and allows Sargi to use the carpool lanes to get to work in San Francisco, a major time saver. “It’s helped us big-time,” Soares says. “I don’t understand why more people don’t jump on it.”

Patricia Leigh Brown is a former staff writer for The New York Times who writes about culture, community, and related issues in California. This post originally appeared at Yale Environment 360.


  1. user-6541158 | | #1

    Not much incentive to improve one's life when you take from the productive and GIVE to those who truly aren't.

    1. Expert Member
      Dana Dorsett | | #3

      Simple models are for simpletons.

      Having more money doesn't mean you are more money doesn't mean you are more productive, just as working in a low wage industry such farm worker / fruit packer doesn't mean you're NOT productive.

      Poverty alone is incentive enough to improve one's lot.

      Living in rental housing also doesn't imply low productivity, but locks the tenant out of most of the long term advantages of improving the efficiency of the housing, and property owner who isn't paying the energy bill has no simple economic incentive to improve it.

      Use of public funds to implement a policy goal where market incentives alone won't achieve those ends is common across all incomes & productivity levels. Corporations & businesses are far more tax-advantaged than their employees, but aren't necessarily more productive than their own employees, and not necessarily incentived to improve efficiency without a policy nudge that has a cash value.

      If taking climate change issue head-on has to wait for the economics of efficiency & low-carb energy to become dead obvious with positive net present value in under 3 years (typical homeowner economics, not low-income) it's not going to happen quickly enough to matter. Even WITH the policy tools covered in this blog piece it's still an uphill slog.

  2. GBA Editor
    Martin Holladay | | #2

    User 6541158,
    Income and wealth aren't a good gauge of productivity, in my estimation. A nurse's aide may be making such a low wage that she finds that her family lives in poverty -- but that doesn't mean that she is less "productive" than a lawyer making $100,000 per year.

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