The declining cost of rooftop solar panels - down over 90 per cent since 2000 - has offered hope for increasing small-scale electricity generation. Canadian

The declining cost of rooftop solar panels - down over 90 per cent since 2000 - has offered hope for increasing small-scale electricity generation.

Industry heavyweights such as General Electric are heralding a "wave of decentralization," while the International Energy Agency claims "the sun could be the world's largest source of electricity by 2050, ahead of fossil fuels, wind, hydro and nuclear."

And while the Trudeau government seems to be jumping on board, calling for Canada's developers to build more "net zero" homes - buildings that produce as much energy as they use - the future of solar in Canada remains "highly speculative," according to the National Energy Board.

One barrier that few in Canada consider is the issue of home ownership. Soaring housing prices and a red-hot market are blocking many Canadians from buying a home, and renters have little reason to go solar.

  •  Canada's renewable power share grows from 2% to 11%

  •  Wind, solar energy real options for Canada's remote Arctic

The Canada Mortgage and Housing Corporation (CMHC) warns that affordability issues in the real estate market are spreading beyond Vancouver and Toronto. Earlier this week, it issued its first "red" warning for the national housing market.

Investment analytics firm MSCI reports that home ownership costs in Vancouver and Toronto now represent more than half the median monthly household income in these centres. Household debt levels among Canadians are at record highs and fewer people are opting for home ownership before 35 than ever before.

In 2015, rentals accounted for the largest share of new residential urban construction since 1992, according to CMHC.

These trends paint a bleak picture for the continued rise of rooftop solar.

"There is basically zero incentive for a renter to spend the money to install a renewable energy system," says Jessica McIlroy with the BC Sustainable Energy Association.

But renters, ironically, are often those most in need of the lower monthly electric bills solar can deliver.

Lower income households, nearly 70 per cent of which are renters, spend up to four times more of their monthly income on electricity than their higher-earning counterparts. And rental housing costs already hover at the "unaffordable threshold" of 40 per cent of median monthly income in two-thirds of Canadian cities surveyed by MSCI.

Solar income gap

Similar trends in the U.S. are drawing attention to what Amit Ronen, director of the George Washington University Solar Institute, calls the solar income gap.

The gap includes higher rates of renting or living in multi-family buildings, and having less access to financing.

The American response hasn't been to implement controversial feed-in tariffs, as Ontario has. These tariffs provide producers with a 20-year guaranteed price per kilowatt hour that can be significantly above market rates.

  •  Losing business to solar, U.S. companies fight to kill consumer trend

  •  Solar on the roof taxed as income

The U.S. often instead relies on net-metering regulation, which allows customers to connect a small electricity-generating unit, like solar panels, to the utility grid in order to trade power for credit toward their bills.

For those who can't afford to install such a system, Americans can take advantage of third-party ownership and financing arrangements - something Canadian jurisdictions have yet to allow in net-metering policies in place here.

Jared Lang, with the U.S.-based National Housing Trust, says programs that allow residents to have panels on their roof - but are owned and financed by a company, such as SolarCity - eliminate a major cost barrier.

Residents can have the panels installed without upfront costs and repay the company over time with the savings on their electricity bills.

And for the 50 per cent of American electricity consumers who don't own their home, live in a multi-family building or simply live in a shaded area, community solar projects - in which nearby residents can buy a share and receive a proportional credit on their electricity bill - are filling in the gap.

Community solar

While no Canadian jurisdiction has a net-metering policy applicable to community units, in the U.S., community solar is expected to represent up to half of the solar market by 2020.

That's because organizations like the National Housing Trust are working to find space for panels, such as unused commercial rooftops, where the utility savings can be passed on to nearby residential tenants.

"It is not a priority for office owners to install solar, so there is a lot of open roof space," Lang says. "Through community solar, we can connect good rooftops with people in need."

Landlords are also being brought into the conversation. "We've seen landlords convert high turnover buildings into much higher demand units with a longer term, stable tenancy by reducing utility costs," says Khalil Shahyd, with the Natural Resources Defense Council.

Yet there remains opposition to making solar power available to everyone.

Net-metering policies are being contested in 46 states, usually by major utility companies raising such concerns as the distribution of grid-maintenance costs.

But John Gorman, president and CEO of the Canadian Solar Industries Association, is confident similar concerns can be accommodated as Canadian jurisdictions work to develop their own policies through a "very managed" approach.

"There are enough options out there that we can meet everyone's concerns and still design robust solar policies," he says.

Kara Sherwin is a Fellow in Global Journalism at the Munk School of Global Affairs, University of Toronto.

The U.S. has more than 70 million single-family homes and nearly all have something in common: They are covered by some kind of roof.

The U.S. has more than 70 million single-family homes and nearly all have something in common: They are covered by some kind of roof. If Elon Musk has his way, those rooftops will all be generating solar power using technology provided by a combined Tesla and SolarCity. He showed off his new vision at an event yesterday, with prototypes of a new roof combining shingles and solar cells. Musk says it will cost homeowners less than a traditional roof plus typical electrical costs. Given Musk is already trying to build a high-volume automaker and develop spacecraft capable of reaching Mars, he’s going to have a lot of work to do before it’s real.

The idea behind this roof isn’t entirely a new one; solar shingles first reached the market in 2005. Those weren’t as elegant as what Musk demoed yesterday and their high cost relative to ordinary solar panels has led to little market presence. The reasons why Tesla / SolarCity might succeed where others haven not go beyond the aesthetics however. SolarCity has direct sales efforts where it operates and handles everything from permitting to installation. But Musk’s presentation left many questions unanswered.

First, will the materials be available to other installers, particularly traditional roofers? While few have embraced solar, they might like this product if it provides them higher incomes and installation is easy enough. They also have expertise in building weatherproof roofs that SolarCity doesn’t. On the plus side, solar permitting should be streamlined with the Tesla roof. There are often issues regarding installs too close to the edges of the home, which should fade with these integrated panels.

The rules are often about firefighter access, however. And that raises a question as to whether local fire codes allow for roofs entirely covered with potentially live solar panels. The individual roof titles are glass covered and non-conductive on the top, but exactly how they will interconnect to one another and to the home’s electrical system were among the many questions yet to be answered. Another issue is cost. Most solar installs today are south facing or at least oriented to capture maximum sunlight. The Tesla roof ostensibly could receive sunlight all day, with the side oriented toward the sun receiving the highest power output.

There’s nothing simple about that, however. First, it means a lot of solar cells that are not receiving optimal sunlight. Those aren’t free to add even once SolarCity’s new “gigafactory” for panel making opens in Buffalo, New York. Second, it means that sections of the roof will have differential amounts of output at different times of day. That causes problems for traditional solar installations which tend to have all panels drop to the output of the one getting the worst light. There are solutions using technologies like solar optimizers and micro-inverters but those also have costs.

It’s possible Tesla will sell a combination of their roof tiles (which come in four styles to mimic traditional roofs, slate roofs, and terra cotta tiles) both active and passive. If you have a shady side of your house, the roof will match aesthetically but it might not be active. And in many homes the optimal solar array today doesn’t cover the entirety of the roof so tomorrow’s need not either.

Of course, Musk is also expecting a lot of customers to want to generate excess power to charge their Tesla vehicles. In many cases, that won’t happen directly as cars tend to be away from home during peak solar hours. But Musk will have you covered there as well so long as you have a Tesla Powerwall 2, the company’s new home battery pack. The new model is twice as larger (14 kilowatt-hours) as the original while sporting a retail price of $5500 — less than twice the $3000 of the first model.

The vision is impressive, the lack of detail suggests it isn’t close to fruition. Musk has done demos like this one before, demonstrating a battery-swapping setup for Tesla cars that never got past the testing phase and seems to have been abandoned. That there was no sample cost calculation for what a Tesla roof might run someone doesn’t inspire confidence this deal will be compelling to most homeowners. Roofing costs vary widely, but typically run $7,000-$15,000. The average home uses about $1300 of power each year as well.

When Musk says the Tesla roof will cost less than the combination, he leaves out a critical variable: How many years of power we’re talking about? On a new home, this should be less of an issue; the incremental cost of the Tesla roof will be a small portion of a typical bill for new construction. When it’s time to re-roof — which Musk says happens 4-5 million times per year in the U.S. — that math is very different. While SolarCity has mostly installed solar on various leases and “power purchase agreements” it seems likely this is a product you would buy outright. From an insurance and financing perspective, that might be the only way it can be sold.

Residential solar has fallen to as low as $3 per watt in the U.S., though some people pay nearly twice that. A revolutionary product would bring that down to more like $2 — a price that is achievable in other expensive labor markets, notably Germany. The Tesla roof might allow that to happen here but Musk wasn’t talking up such benefit. Instead, his talk was about batteries, EVs and solar roofs working together to help combat climate change.

That’s the right kind of giant goal. With nearly all roofs in the country due to be replaced over the next 20 years, the new Tesla roof could be the first product that leads to the vast majority of them becoming miniature green power plants. But cost, installation, local rules and the uncertainty surrounding shareholder approval of the Tesla / SolarCity deal all stand as possible roadblocks. They’re just the beginning of a longer list of questions Musk and the combined company will need to answer.

It’s worth noting that yesterday’s demo was conducted on “Wisteria Lane”, where the fictional homes from the defunct television show Desperate Housewives are located. Those structures aren’t even themselves fully realized, which provides a perfect metaphor for the Tesla roof. Musk presumably plans to be even busier to turn that Potemkin Village into reality. The planet may depend on it.

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