The high cost of rooftop solar has been the greatest obstacle to industry growth and is still a barrier for many households.
A new study suggests that one factor may make some homeowners more willing to give solar a try.
In a paper published by the Lawrence Berkeley National Lab, researchers explore a surprising variable in solar power adoption. Published in November 2023 in the journal “Energy Economics,” the paper examines how peer influence can encourage homeowners to install solar rooftop panels, and how this dynamic varies across income levels.
By examining rooftop solar installation records and modeled household-level income estimates, the researchers observed some patterns. First, they note that rooftop solar adoption benefits from the so-called “solar bug.” When one household installs new panels, the idea becomes “contagious,” and other neighbors are likely to do the same.
Homeowners can catch the “bug” in several ways. They might see the panels installed and decide to do the same. Sometimes the benefits of solar travel through word-of-mouth, as neighbors tell other neighbors. Finally, the idea catches on when neighbors refer the professionals who installed their panels to other nearby homeowners.
According to the study, however, the contagious effect of solar installations is less effective in lower-income neighborhoods. This negative correlation is due primarily to the known obstacles that low-income households still face when it comes to installing solar, the greatest barrier being cost.
As the study explains, household budget constraints and the high up-front costs to buy and install panels make rooftop solar a much more cost-prohibitive proposition for low-income households than they do for households with the means to invest in solar. With that in mind, low-income households may catch the “solar bug” just as easily as more affluent ones, but they are less likely and able to make the commitment even when they do.
On that note, the study makes another finding. The analysis suggests that low-income households are more likely to adopt solar when they live near other low-income adopters than when their neighbors are in a higher income bracket. In other words, low-income households respond more strongly to the influence of other low-income households.