Policy Memo: Proposed Low and Moderate Income Solar PV Pilot Program for Chicago

To: The Honorable Brandon Johnson, Mayor of Chicago

From: Jane Bartman, Policy Advisor

 

 

Executive Summary

 

Chicago households – particularly those of low- and moderate-income – face high energy burdens and limited access to the benefits of clean energy, despite the City’s ambitious climate goals. The City of Chicago’s 2022 Climate Action Plan (CAP) sets out net-zero targets that place equity and environmental justice at the heart of climate action, working to ensure that communities that have disproportionately suffered from environmental and climate impacts can benefit from the energy transition.

To achieve these aims, I recommend a residential solar program for low- and middle-income (LMI) residents, offering access to renewables at no upfront cost. This program is particularly needed given the expected slowdown in renewables deployment with the gutting of the Inflation Reduction Act (IRA) and Solar for All. The program should build on other cities’ best practices, including the Solarize Greater Philadelphia campaign. Chicago should pilot this program in 1-3 neighborhoods facing high energy burden, expanding citywide based on pilot learnings. 

 

Chicago Energy Burden

 

20% of Chicago households experience high energy burden, spending 6%+ of their income on energy; over 25% of low-income households spend 15%+ of their income on energy (ACEEE, 2023). These burdens are linked to housing/income instability and adverse health outcomes, and disproportionately impact low-income families with children, minorities, and seniors (Elevate Energy, 2017 and 2019).

Renewables can alleviate these burdens. While solar adoption is disproportionately low in LMI census tracts, research indicates that these areas actually have Chicago’s highest solar potential (Heeter et al., 2021).

 

Why Chicago Must Act to Broaden Access to Solar

 

Chicago’s 2022 Climate Action Plan sets a goal of 100% renewable energy citywide by 2035; focusing on ensuring that LMI residents benefit from the energy transition.

Barriers to LMI solar adoption are well-documented, including high upfront costs, limited credit access, and structural challenges from rental housing and split incentives (Heeter et al., 2021). The IRA’s Solar for All program promised to address these gaps: 88% of grantees planned to fund solar deployment in disadvantaged communities (EPA, 2025). However, clawbacks have created a hole in pathways to access – now, City action is even more critical. 

 

Recommendation: A Solar Financing and Implementation Pilot for LMI Residents

 

A City-led, blended-finance program, integrating local, state, federal, and utility funding, City-backed green finance, and public-private partnerships, offers a proven path to impact.

Successful peer-city programs have effectively eliminated cost barriers through third-party ownership and revolving loan funds. One model is the Philadelphia Green Capital Corporation’s (PGCC) Solar Renewable Energy Credit (SREC)

A pool of loans made to individuals or small-businesses which self-funds via the proceeds received from loans within the portfolio.

, which subsidizes solar lease costs for LMI Solarize Philly participants. The Fund, which supports 1,300+ homes, offers capital partners stability via a guaranteed SREC price; PGCC uses SREC proceeds to support additional households (Author interview, 2025). 

The program can effectively complement existing renewables supports. Illinois’ Solar for All Program (ILSFA) is oversubscribed and must serve residents statewide; it is also likely to be cut back with the loss of EPA funds (Illinois SFA, 2025). Chicago can therefore meet a gap by assisting more local residents. The City should integrate ComEd utility incentives (i.e., Solar Rebate Program) and expand on-bill financing or community solar bill credits to further reduce upfront costs. For renters and small landlords, often unable to benefit from rooftop solar, subsidized community solar subscriptions can deliver savings and address split incentives.

Structural issues – notably, roof condition – present deployment barriers. Chicago’s existing Home Repair Program, if expanded to properties serving LMI tenants, can address these needs (City of Chicago, 2025). Participants will receive no- or low-cost roof repairs, a benefit that can also encourage landlord buy-in. 

Building resident trust is essential. Community-based organizations (CBOs) with strong local networks should manage resident outreach and offer multilingual support. The City should also pre-vet/qualify contractors, following a similar model to ILSFA, addressing potential risks and concerns about unscrupulous contractors.

To mitigate displacement risk from increased property values, program design must include tenant protections, including enforceable rent increase limits. Chicago can look to other cities’ approaches for net zero upgrades, including Boston’s Healthy and Green Retrofit Pilot.

 

Cost-Benefit and Other Considerations

 

Preliminarily, I recommend a $5 million, 3-year pilot, enabling meaningful deployment and learnings to calibrate the program before scaling. 

Emission reduction potential is heavily dependent on uptake and participating buildings’ solar potential. However, Illinois Solar for All data suggests potential impact scale: in 2023-2024, it funded 579 small residential solar projects totaling 5,041 kW, with an incentive value of $21.7 M. This achieved ~3,000 tCO2e savings annually (Illinois SFA, 2025; PowerOutage.us, 2025), or ~700 tCO2e annual savings for a $5 M program.

The program offers significant co-benefits. Energy-burdened residents are forced into painful bill tradeoffs, with consequences for health and housing/employment stability. Residential solar mitigates these tradeoffs; per RMI’s RESET, Cook County households may see $1,356 in net savings in year 1. Growing Chicago’s solar installation market can also offer good green jobs, particularly if paired with training for LMI residents. The program can also enable limited but material benefits from avoided generation capacity by reducing system peak loads, as well as reliability. Solar also offers health benefits from fewer pollutants, and is an important step towards reversing long-term patterns of inequitable development and investment in Chicago. While difficult to quantify economically, these benefits offer tangible enhancements and, importantly, reflect the City’s commitment to all of its residents. 

 

Next steps

 

Leadership from the Mayor’s Office is critical to coordinate departments, secure funding, and establish cross-sector partnerships for deployment. 

To develop the program, the City should convene partners, including technical experts, community members and LMI-community serving organizations. Their input, coupled with analyses of 1) areas facing high energy burdens and 2) solar potential, can inform pilot neighborhood selection. The City should then issue an RFP for CBOs to engage participants. 

The City should also consider establishing a revolving fund that can leverage bond proceeds, philanthropic investment, and other sources of capital to maximize program reach and impact. 

Please reach out with any questions on this proposal and recommendations.
 

Bibliography

 

American Council for an Energy-Efficient Economy. (2020). How High Are Household Energy Burdens? https://www.aceee.org/sites/default/files/pdfs/u2006.pdf

American Council for an Energy-Efficient Economy. (2023). ACEEE’s Leading with Equity Initiative: Lessons Learned in Advancing and Measuring Energy Equity. https://www.ilsag.info/wp-content/uploads/SAG-ACEEE-Presentation_Energy-Equity_3-22-23-Meeting.pdf 

City of Chicago. (2019). Support for Implementation of Clean Energy Transition Plan (R2019-157). https://chicago.legistar.com/View.ashx?M=F&ID=7091883&GUID=2E119D3B-43F9-4750-A20E-561FEE04B505 

City of Chicago. (2022). Chicago Climate Action Plan. https://www.chicago.gov/content/dam/city/sites/climate-action-plan/documents/Chicago-CAP-071822.pdf

City of Chicago. (2025). Home Repair Program. https://www.chicago.gov/city/en/depts/doh/provdrs/homeowners/svcs/home-repair-program.html 

Elevate Energy. (2019). Energy Insecurity Among Chicago Homeowners. https://www.elevatenp.org/wp-content/uploads/energy-insecurity-chicago-homeowners-report.pdf 

Elevate Energy. (2019). Energy Burden in Illinois. https://www.elevatenp.org/wp-content/uploads/Energy-Burden-in-IL.pdf

Environmental Protection Agency. (2025). Solar for All Fast Facts. https://www.epa.gov/greenhouse-gas-reduction-fund/solar-all-fast-facts

Heeter, J., Sekar, A., Fekete, E., Shah, M., & Cook, J. J. (2021). Affordable and Accessible Solar for All: Barriers, Solutions, and On-Site Adoption Potential. (NREL/TP-6A20-80532 ) https://docs.nrel.gov/docs/fy21osti/80532.pdf 

Illinois Solar for All. (2025). Residential Solar. https://www.illinoissfa.com/residential-solar/ 

Myrtetus, M., Abramson, A., Block, B. (2025). Interview by Jane Bartman.

PowerOutage.us. (2025). Illinois Solar Panel Cost: Savings and Payback. https://poweroutage.us/solar/il 

RMI (2025). Residential Emissions and Solar Economics Tool. https://bit.ly/42qHvuT