2,056 megawatts of community solar have been installed in the U.S. through 2019
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Community Solar

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Today, 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.

Community solar provides homeowners, renters, and businesses equal access to the economic and environmental benefits of solar energy generation regardless of the physical attributes or ownership of their home or business. 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 refers to local solar facilities shared by multiple community subscribers who receive credit on their electricity bills for their share of the power produced. This model for solar is being rapidly adopted nationwide.

Quick facts

Community Solar projects may be located on public or jointly-owned property, and can be an easier way for customers to benefit from a local solar energy project. A 2015 NREL and DOE report estimates that nearly 50% of consumers and businesses are unable to host photovoltaic (PV) systems, but there are many reasons why community solar might be preferred for a home, business, or individual, such as:

  • Renters may be prohibited from installing solar on the property
  • The roof may be too shaded or will need re-roofing during the solar warranty period
  • The size, type, or orientation of the roof may be improper
  • Some commercial buildings have equipment on the roof, obstructing an installation
  • Multi-tenant dwellings or businesses may not own their rooftop
  • The customer is not able to afford the up-front cost of a residential system

Community Solar Models

There are various ways that customers (or “subscribers”) may participate and receive benefits from shared renewable energy. Successful models generally include a billing mechanism that allows subscribers to receive credit on their electricity bills for their share of the power produced. The most common models are the utility-sponsored model, on-bill crediting, the special purpose entity model, and the "buy a brick" model. 

Utility-Sponsored Model

Some utilities provide their customers with the option to purchase renewable energy from a shared facility. The utility owns the array, then sells or leases shares to customers. 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. The rate, while typically slightly higher than the current retail rate, may provide protection and stability against rising rates for grid electricity. Utility models generally limit subscription to within their distribution territory. 

On-bill Crediting

The on-bill crediting model enables residents and business to invest in a portion of a local solar facility, and receive a credit on their electricity bills for their share of the power produced. Credits may be provided in the form of kilowatt hour (kWh) offsets to the customer’s consumption, or monetary credits to the customer’s bill. Because of diverse state laws and regulations, the rate at which the energy is valued is dependent on geographical area.

Special Purpose Entity (SPE) Model

In this approach, individuals or companies join in a business enterprise to develop a community solar project. The business may design, construct, and own the facility, then work with the local utility to allocate benefits to subscribers. By using an SPE, organizations may be able to take advantage of incentives and tax credits that are unavailable to utilities. University Park Solar and the Clean Energy Collective are examples of this model.

Non-Profit “Buy a Brick” Model

In this model, donors contribute to a shared renewables installation owned by a charitable non-profit organization. The non-profit Grid Alternatives is actively and successfully pursuing this model.

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Community Solar

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Additional Resources on Community Solar

Core Principles for Community Solar

SEIA promotes policies, programs and practices for community solar that adhere to the following principles:

  • Allow all consumers the opportunity to participate in and directly economically benefit from the construction and operation of new clean energy assets.
  • Provide equal access for developers to build and operate community shared renewable energy systems and interconnect those systems to the serving utility’s grid.
  • Incorporate a fair bill credit mechanism that provides subscribers with an economic benefit commensurate with the value of the long-term, clean, locally-sited energy produced by community shared renewable energy projects.
  • Support the participation of diverse customer types in renewable energy markets, and encourage customer choice with providers, product features, and attributes to catalyze innovation and best serve customers.
  • Provide assurance of on-going program operations and maintenance to ensure overall quality, that the facility lasts for decades, and that customer participation is protected. Safeguard the continuity of program benefits to protect customers and developers’ investment.
  • Ensure full and accurate disclosure of customer benefits and risks in a standard, comparable manner that presents customers with performance and cost transparency.
  • Comply with applicable securities, tax, and consumer protection laws to reduce customer risk and protect the customer.
  • Encourage transparent, non-discriminatory utility rules on siting, and interconnecting projects, and collaboration with utilities to facilitate efficient siting and interconnection.
  • Maintain a 360-degree view of community shared renewable energy market and ensure a beneficial role for all parties in the partnerships forged between subscriber, developer, and utility.

Additional Community Solar Resources

The Coalition for Community Solar Access: The Coalition for Community Solar Access (CCSA) is a national Coalition of businesses and non-profits working to expand customer choice and access to solar for all American households and businesses through community solar. Their mission is to empower every American energy consumer with the option to choose local, clean, and affordable community solar. They work with customers, utilities, local stakeholders, and policymakers to develop and implement policies and best practices that ensure community solar programs provide a win, win, win for all, starting with the customer.

Interstate Renewable Energy Council (IREC): IREC is a leading group in ensuring that shared renewables become more prevalent in the U.S. They provide resources such as a “Guiding Principles for Shared Renewable Energy Programs”, “Shared Solar Program Catalog”, and “Model Rules for Shared Renewable Energy Programs”.

Shared Renewables HQ: This is a project of Vote Solar, and is the central information center for shared renewable energy projects and policy across the U.S.

National Renewable Energy Laboratory (NREL) Guide to Community Shared Solar: This guide is a resource for those who want to develop community shared solar projects, from community organizers or solar energy advocates to government officials or utility managers.

NREL Focusing the Sun, State Considerations for designing Community Solar Policy.

Community Solar Marketplace: EnergySage has developed an easy-to-use tool to find community solar projects near you.

Department of Energy (DOE) Solar Energy Technologies Office: The U.S. Department of Energy (DOE) Solar Energy Technologies Office focuses on achieving the goals of the SunShot Initiative, which seeks to make solar energy cost-competitive with other forms of electricity by the end of the decade.

National Community Solar Partnership: The Partnership’s mission is to leverage the momentum in the public and private sector to expand solar access to new markets (demographic and geographic) and convene relevant stakeholders to assess market barriers and catalyze deployment in low- and moderate-income (LMI) communities.

Community Solar Hub: A resource for developing community solar projects, including a state-by-state listing of projects.

Grid Alternatives: GRID Alternatives' vision is a successful transition to clean, renewable energy that includes everyone. Their mission is to make renewable energy technology and job training accessible to underserved communities.

Where It's Happening

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