What Is Community Solar?
- Posted on July 11, 2018
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For many people the words “solar energy” bring to mind a house in a sunny climate with solar panels on the roof. However, according to the Solar Energy Industries Association (SEIA), “many American households and businesses do not have access to solar because they rent, live in multi-tenant buildings, have roofs that are unable to host a solar system, or experience some other mitigating factor.”
The good news is that these people can still have access to solar energy via community solar programs. The SEIA states, “Community solar expands access to solar for all, including in particular low-to-moderate income customers most impacted by a lack of access, all while building a stronger, distributed, and more resilient electric grid.”
Community solar is a local solar facility to which a number of households and businesses can subscribe, and get a corresponding credit on their electricity bill. Just as in other industries (think Netflix), the subscription model for energy is quickly gaining popularity throughout the U.S.
Community Solar Flavors
Community Solar can be deployed in a variety of ways. According to Smart Grid, “the solar panel arrays are usually owned by either your electric utility, a solar developer or a third party ‘special purpose entity,’ a non-profit or business enterprise created for the purpose of developing a community-owned shared solar project.”
The most typical model is ownership by a utility. In this scenario, “The customer may purchase a set amount of electricity at a fixed rate for a term, ranging from as short as a kilowatt-hour block to as long as 20 years,” explains the SEIA. It adds that the rate may be slightly higher, but paying the higher amount guards against rising electricity rates.
Community Solar Benefits
The Coalition for Community Solar Access lists the following benefits of community solar:
- Equal Access. As mentioned above, anyone in the community can take advantage of community solar.
- Favorable Economics. “Sunshine is free, which means solar offers reliable energy at a predictable rate for decades.”
- It’s Easy. “Customers can sign up to participate in a community solar project in a few minutes and begin receiving power production credits on their next utility bill.”
- It’s Mobile. Utility customers can move within the distribution area and maintain their community solar subscription.
- Utility Partnerships. “The community solar model is based on a mutually beneficial relationship with utilities, allowing them to provide a product their customers want – locally-made clean energy.”
Additionally, according to EnergySage, federal and state tax credits may be available to companies who develop community solar plants. “In some cases, community solar project participants may be able to claim…tax credits for themselves.”
Community Solar Projects
The SEIA notes, “There are 36 states with at least one community solar project on-line, with 1,023 cumulative megawatts installed through Q1 2018.”
Just one example is Coyote Ridge Community Solar Farm in Fort Collins, Colorado, which, according to Conor Ryan writing for PV Tech, was developed to “cut down on electric bills for qualified low-income residents.” Ryan adds that the project “is part of a statewide initiative to demonstrate how low-income community solar can be used to cut energy costs for utilities’ highest need customers.”
According to a press release from the Colorado Energy Office (CEO), “The 1.95 megawatt Coyote Ridge Community Solar Farm will demonstrate complex financial modeling, a mix of low-income and community benefit subscribers, and unique location siting…. The project is sited on nine acres of land south of the Larimer County Landfill near Fort Collins.” Project development also involved GRID Alternatives, whose mission is to “make renewable energy technology and job training accessible to underserved communities.”
Given the environmental, economic, and social benefits of solar energy, community solar will likely continue to grow in popularity as just one method for harnessing this plentiful power supply.