Cheaper, cleaner, quiet energy. It’s an easy sell. That’s why community solar farms have been sprouting up across the nation. Forty states have at least one community solar project, and 1,523 megawatts (MW) of this type of solar were installed in 2018.
Community solar allows residents near a solar installation to purchase a share of the facility and in return, gain the economic benefits of clean energy. These installations are smaller in size and generation than utility-scale projects and face less opposition from neighbors, who look forward to a reduction on their electricity bill.
Community solar installations work like neighborhood P-Patches. Subscribers receive credit on their electricity bills based on how much their share of the project generated. Because these installations are small and nearby residents gain the benefits, the projects often face less opposition in county zoning hearings than utility-scale solar, which is usually purchased by a utility or big energy user.
Community solar can expand access to renewable energy for many Americans that may not have optimal roofs for generating solar. Renters, those with a shaded roof, those that can’t afford rooftop solar, or those that live in a multi-family dwelling can enjoy the benefits and cheaper electricity provided by solar without having to pay thousands to install panels.
Washington and Oregon have policies in place to help support and implement more community solar, while Montana and Idaho each have at least one project online, even without any specific community solar policies.
Legislation passed in the state in 2017 allows more flexibility on where projects can be built, their maximum size, how people can participate, and incentives offered to customers. By 2018, 26 more projects had been approved under the new legislation. In Washington, community solar projects must have at least 10 participants and the project must be 1 MW or smaller.
Oregon passed legislation in 2016 to encourage community solar. These installations can be up to 3 MW in size, and 10 percent of each project must serve low-income customers. An initial pool of 40 MW total generation was allocated for these types of projects during the first phase of the program roll out in December 2019.
Although Montana doesn’t have legislation in place to expand community solar, the Montana Energy Office and U.S. Department of Energy have partnered to create the Montana Solar Community Project, an initiative aimed at expanding community solar development in the state. This group hosts meetings to inform the public and listen to opinions on solar, offers resources to assist developers, and makes some policy recommendations.
Community solar has not fared well in Idaho. Idaho Power suspended its community solar program when a proposed project outside of Boise only received 15 percent of the subscriptions necessary to keep the project financed. In Idaho, community solar participants would be credited the wholesale price of the electricity instead of the retail price. The wholesale price is the price it costs utilities to produce power, while the retail price is the price you pay on your power bill, about three times more than the wholesale price.
Most rooftop arrays credit the owners back at the retail price, and many states price community solar the same way, making it a worthwhile investment. In Idaho, the utility has struggled selling subscriptions to community solar with low returns and long payback periods.
Community solar has proven successful at expanding solar power across the U.S. Customers buying into the program pay the majority of the upfront installation and equipment costs, allowing utilities to build more solar without a huge initial investment. In addition, community solar allows people to feel ownership over their power and creates the opportunity for solar for more people throughout the country.