Solar energy use has skyrocketed in popularity in recent years, but mostly within certain market segments. In particular, renters, low-income families, residents of multiunit buildings, and households with shaded properties have largely been left out. In many states, an alternative ownership model, community solar, has made renewable energy use feasible, practical, and affordable for many more households and businesses.
How Does Community Solar Work?
Community solar farms, also known as community solar gardens or shared solar, are installations that provide renewable energy for a group of households, organizations, or businesses. This arrangement enables participants to enjoy the benefits of clean energy without having solar PV modules installed on their properties.
Typically, the electricity generated from community solar farms is more economical than grid power from electric utilities. This ownership model is relatively new to the solar power market and allows more households and businesses to join the clean energy movement.
Community solar programs utilize a concept called virtual net metering, allowing utility customers to receive credits on their electricity bills from solar power generated by the photovoltaic project. Typically, subscribers have two bills: one from the utility company and another from the solar farm.
The ownership of a community solar farm varies by project, and a couple of popular models exist. Typically, the solar farm is owned by a solar developer, utility company, investment company, or the members themselves. The exact cost to customers varies depending on the size of the subscription or the amount of power generated.
Variable Prescription Options for Community Solar
These pay-as-you-go plans require members to sign up for a portion of a solar farm. Then, they make monthly payments for the electricity produced by their portion. The monthly payments vary depending on the climate and weather.
Therefore, subscribers will likely pay less in the winter when the days are shorter and pay more in the summer. It is important for solar subscribers to understand that their monthly bills will vary, so they can budget accordingly.
Fixed Prescription Options for Community Solar
With this type of plan, subscribers sign up for a specific proportion of the community solar farm. Thus, they pay a fixed monthly fee based on the subscription size. The payments are the same throughout the year, regardless of how much electricity the solar panels produce.
Where are There Community Solar Farms?
There are community solar farms in 41 states and Washington, D.C., with more than 5,800 megawatts of installed PV capacity, according to the Solar Energy Industries Association. But, there is far more community solar in some states than in others. This concept is growing in popularity, especially in states with supportive laws and policies.
The leading states for community solar include California, Colorado, Florida, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, Rhode Island, and Virginia. Policies make community solar farms prohibitively expensive or difficult to develop in some states. For example, some states might have policies that limit the number of subscribers who can join a community solar installation, making the projects less economical to develop and operate.
Many states are intentionally updating their policies to make community solar farms an attractive option for increasing solar access. When this happens, there is often a spur of development to make up for the pent-up demand and a surge in project development.
What Are The Benefits Of Community Solar?
Community solar farms have numerous advantages for utility customers, communities, electric utilities, and the planet.
Financial Savings
Often, joining a community solar farm results in lower utility bills, and it usually doesn’t require any upfront investment. Unfortunately, purchasing a solar array is not affordable to all homeowners, so community solar farms make clean energy available to people with low to moderate incomes. Some states or utility territories have special programs available for low-income residents that make solar gardens even more affordable.
However, joining a community solar project doesn’t always result in greater cost savings in the long term compared to purchasing a solar energy system, especially for people with sunny properties. Also, members of community solar farms don’t usually get tax credits, renewable energy credits, or other incentives, but the savings can be indirectly passed down to solar subscribers through lower-cost electricity.
Flexibility And Ease
Most solar farms allow members to cancel with a certain amount of notice, often for no fee. Also, many programs allow members to continue their membership with a community solar farm if they move within the same utility service territory. Many subscribers appreciate that it is so easy to join a solar farm or terminate the contract,
Environmental Protection With Solar Energy
Just like rooftop solar, community solar gardens have no emissions and reduce reliance on fossil fuels. As concerns about climate change increase, these solar projects provide convenient solutions.
Expanded Renewable Energy Options
Unfortunately, not all utility customers are a good fit for installing solar panels on their homes and businesses. In particular, renters, owners of shaded properties, and residents of multifamily buildings often can’t install solar panels. Thus, community solar subscriptions overcome these hurdles. Many states with renewable portfolio standards are exploring ways to increase the use of clean energy and phase out coal, oil, and natural gas-fired power plants.
Community-Building
Solar gardens show that great things can happen when people work together and collaborate. Often, community solar farms bring together a group with the shared value of transitioning to clean energy.
Solar System Maintenance
When a homeowner purchases a solar system, they are responsible for the maintenance and repairs, although warranties can reduce the cost. It is important to have homeowners insurance that covers the solar installation in the case of a natural disaster.
By contrast, with community solar farms, the solar farm owner is responsible for maintenance. This offers peace of mind to members that they don’t need to review solar monitoring data, utility bill credits, or inverter readouts to make sure the system is operating correctly.
How To Start A Community Solar Project
Starting a community solar farm involves several steps, and it's important to consider various aspects such as legal requirements, financing, and community engagement.
Community Solar Research and Planning Research local, state, and federal regulations regarding solar energy projects and community solar projects in particular. Different regions may have specific rules, zoning requirements, permitting challenges, and incentives for renewable energy projects. Also, identify suitable sites for your community solar farm. Consider factors such as sunlight exposure, accessibility to 3-phase power, topography, and proximity to population centers.
Form a Community Solar Team Consult with legal and financial professionals who have experience in renewable energy projects. They can help with compliance, contracts, and financial planning. Engage engineers and solar energy experts to assess the feasibility of the project, design the solar farm, and provide technical support. The GreenLancer team is available to help with a solar feasibility study, an engineering review, or solar permit plan sets.
Community Engagement Educate the community about the benefits of community solar and gather support. Hosting informational sessions, creating a website, and using social media can be effective ways to reach people. Establish a group or organization that represents the community's interests and acts as a liaison between the community and the solar project.
Legal and Regulatory Compliance for a Community Solar Project Obtain all necessary permits and approvals from local authorities and utility companies. This may include environmental permits, land use permits, and interconnection agreements. Also, choose a legal structure for your community solar farm, such as a cooperative, LLC, or nonprofit. Consult with legal experts to ensure compliance with relevant laws.
Obtain Community Solar Financing Explore funding options, including grants, loans, and community contributions. Consider government incentives and tax credits that may be available for solar projects. Explore partnerships with local businesses, investors, or solar developers to share the financial burden and expertise.
Community Solar Design and Construction Work with engineers to design the solar array, considering factors like the number of panels, orientation, solar equipment, and energy production estimates. Next, it's time to build the solar farm. Ensure that construction follows the approved design and adheres to safety standards.
Connect to the Grid Coordinate with the local utility to connect your solar farm to the grid. Ensure compliance with interconnection requirements and standards. The GreenLancer marketplace is available to complete solar interconnection applications.
Solar Farm Operation and Maintenance Develop a plan for the ongoing operation and maintenance of the solar farm. This includes monitoring solar energy production, addressing any issues promptly, and performing routine maintenance.
Launch and Outreach Celebrate the completion of the solar farm with a launch event. Use this opportunity to showcase the benefits of the project and express gratitude to the community and stakeholders. Maintain ongoing communication with the community by providing updates on energy production, environmental impact, and community benefits.
The Community Solar Market Is Growing
In many states, community solar farms are the fastest-growing segment in the industry. As each project comes online, hundreds or even thousands of households often benefit. In general, laws are changing to make community solar farm development more favorable, but it varies widely on a state-by-state basis.
There are many opportunities for solar companies to get involved in the community solar movement, especially with solar system design, construction, and maintenance.
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