Last Updated on November 1, 2023 by admin
There are approximately two billion gigawatts of community solar installed across the United States. These solar projects support rural communities by generating local revenue and helping them build a clean and sustainable future. Community solar projects are authorized in 19 states, along with the District of Columbia, allowing residents, farmers, small businesses, and municipalities to receive credit on their electricity bills. A paper by SEIA shows how to build a community solar project. Through these papers, local residents will be able to access to solar energy without the help of professional consultants.
Solar farms contribute to rural communities economically and socially. Community solar provides electricity to residents at a lower cost than utility stations. If the owner chooses to lease instead of purchasing the property, local farmers and landowners can also benefit from the project. The lifespan of solar system is about 25 to 30 years, which can cause the system owner to pay the lease for decades.
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Important Points To Remember:
- A community solar program enables individuals, small businesses, municipalities, and other entities to receive credits on their electricity bills by harnessing the power generated from a shared solar array.
- A community solar project is a centralized solar power plant that supplies electricity to multiple properties, rather than just one.
- The subscription-based model is the most popular and common option available in the community solar program.
- Crowdfunding, also known as online investment platforms, allows companies to open up online portfolios for renewable energy.
- Community solar farms have the potential to effectively utilize land that was previously unusable, such as landfills, generating clean energy from otherwise untillable sites.
What is in this article?
What are Community Solar Programs?
A community solar program enables individuals, small businesses, municipalities, and other entities to receive credits on their electricity bills by harnessing the power generated from a shared solar array. This allows them to offset their electricity costs and reap the economic and environmental advantages of solar energy, regardless of whether they can install solar panels on their own property. Community solar projects are typically smaller in scale, with electrical capacities of less than five megawatts. Unlike residential or commercial installations, community solar programs are often installed on leased land and can be restored to their original condition after use. In the United States, over 1,800 megawatts of community solar capacity have been installed since 2019.
How Does Community Solar Program Work?
A community solar project is a centralized solar power plant that supplies electricity to multiple properties, rather than just one. Unlike residential solar installations, community solar projects are much larger. The capacities of these projects are measured in megawatts, and they have the ability to power hundreds or even thousands of homes. Community solar, also known as roofless solar, solar gardens, or shared solar, offers a solution for individuals who are unable to install solar panels on their rooftops, such as renters or those living in shared housing. By purchasing a share or subscribing to a community solar project, anyone can enjoy the benefits of solar energy and save on their electricity bills.
There are multiple agreements that farmers can use. Generally, farmers may lease a portion of their property for solar development during the lifespan of the project, which is about 30 years. If the solar project is completed, the solar company pays the landlords for the use of the property. Farmers can also become subscribers to the solar project, receiving additional savings on their electric bills.
Collaborative initiatives like these offer rural communities access to clean and sustainable energy. These programs will also provide farmers with an extra source of income, which can be crucial for their family businesses. Projects like these not only support states and towns in achieving their clean energy and climate goals but also ensure that agricultural production isn’t affected.
Community solar is mostly located on leased land. This program provides the economic and environmental benefits of solar energy without having ownership of a home or business. As the popularity of community solar grows, the agreement between landowners and community solar developers is becoming more common.
Model of Community Solar Program
Once you join the community solar program, you can either buy solar panels in the community or pay for just the electricity. The cost of this electricity is usually lower in comparison to the utility station. The Community solar program can offer:
Ownership-Based Model:
In this program, you can buy a certain number of panels or a share of solar community projects. When you buy from community programs, you will receive electric bill credits for the power produced by the solar panels you own. This program is similar to purchasing rooftop solar panels, with the only difference being that the installation of solar panels does not take place on your rooftop. Instead, you own a certain number of panels from the community solar arrays. The only drawback of this model is that you cannot buy panels beyond your household electricity needs. The actual output of the entire project will be indicated on your monthly electricity bill
Subscription-Based Model:
The subscription-based model is the most popular and common option available in solar community programs. Most subscription programs are easy to sign up and easy to cancel. This model allows participants to become subscribers and pay a lower rate on their monthly electricity bills. Instead of owning a system, you are simply purchasing electricity at a lower rate than the utility grid. There is no upfront fee to join this program. Signing up for a subscription model is similar to joining a green power program. The only difference is that the cost of electricity is higher than the community solar program.
To avail yourself of the benefits of community solar projects, you need to live within a certain distance from these programs. Many companies also impose limits on how much energy you can receive from the community’s panels.
Availability of Community Solar Programs
State-level legislation is necessary for community solar programs. Many states in the U.S. have passed legislation to ensure the proper functioning of community solar projects. This demonstrates that the community solar market has the potential to grow nationwide.
Here is a list of states where community solar projects are actively working:
- Rhode Island
- Massachusetts
- Maryland
- California
- New York
- Illinois
- Colorado
- Minnesota
- Maine
- New Jersey
Difference Between Community Solar and Other Programs
Community solar programs are often confused with other types of electricity rates and incentives, such as:
Group Purchasing:
This program allows large corporations and bigger households to purchase their own solar panel systems at bulk rates. This purchase is mostly negotiated with the solar installation company. The best example of group purchasing is Philadelphia’s Solarize Program. In community solar projects, all participants benefit from one central system. However, in a group purchasing project, each participant purchases their own solar system.
Green Power:
The Green Power program allows customers of the grid station to purchase electricity from renewable energy companies, such as large-scale hydro, wind, and solar power stations. Green power projects are often more expensive than other programs. The energy in green power programs mostly comes from pre-existing communities. People usually affiliate with this program with the primary motive of saving the planet rather than saving money on their electricity bills. In contrast, community solar projects are solely for the purpose to save money on participants’ electricity bills.
Crowdfunding:
Crowdfunding, also known as online investment platforms, allows companies to open up online portfolios for renewable energy. This enables individuals to invest in solar installations from the comfort of their homes. Participants do not receive electricity from these projects to offset their monthly utility bills. The projects in crowdfunding are taxable since these panels are considered as investments. On the other hand, electricity bills from community solar programs are not taxable.
How Does Community Solar Help Urban Areas?
In urban areas, there is often unused rooftop space and community land that can be utilized to generate solar energy at a lower cost for local governments, schools, nonprofits, businesses, and residents at all income levels. Here are the ways in which community solar can help urban areas:
Save Municipal Money:
Cities can enter into power purchase agreements with solar developers, allowing homeowners to access affordable, clean energy in exchange for their unused rooftop space or land. In these agreements, the solar system ownership belongs to the developer. The contractor will then sell the solar energy to the city at a lower price than the utility grid.
Solar developers also offer low-cost, well-paying jobs and training opportunities, boosting the local economy. In 2016, the Philadelphia Energy Experts launched a billion-dollar campaign for clean energy. This program has the ability to create 10,000 jobs for local residents and can save up to $200 million for the local economy over 10 years.
Clean Energy for All:
Community solar programs provide a viable solution for individuals who are unable to install solar panels on their own homes or businesses. These initiatives enable people from diverse income levels to access clean energy and reduce their energy costs.
By implementing community solar projects, municipalities can harness the benefits of solar energy. The centralized approach of community program makes solar energy more cost-effective for residents. These savings can then be used by municipalities to allocate resources for assisting their residents. Examples of such programs include Low-Income Energy Assistance, Energy Efficiency Programs, Housing Assistance, Renewable Energy Education and Outreach, and Community Development Programs.
Create Local Resilience:
In certain cities, natural disasters such as floods, fires, and mudslides can cause power outages. To address this issue and reduce the impact of future outages, some cities form partnerships with renewable energy providers. An example of this is Santa Barbara County in California, which was devasted by wildfires in 2017 and subsequent flooding and mudslides in 2018, resulting in severe power disruptions. In response, local cities in the area recognized the potential of implementing renewable electricity systems combined with microgrids and energy storage. These measures aim to enhance resilience, ensure backup energy supply, and mitigate the adverse effects of similar events in the future.
State Responsibility Towards Climate:
Many cities are committed to sustainability by setting net-zero goals. Cities can reduce their greenhouse gas emissions by implementing local community solar projects. When a city builds a community solar project, it achieves three important objectives:
- It sends a powerful message about the city’s dedication to environmental sustainability. By investing in renewable energy like community solar projects, the city demonstrates its commitment to a sustainable future.
- It sets an example for its citizens, highlighting the significance of using renewable energy sources. By implementing community solar projects, the city serves as a role model, demonstrating the practicality and importance of adopting renewable energy technologies to its residents. This encourages individuals and businesses within the community to follow suit and make their own sustainable energy choices.
- It optimizes the use of limited resources to maximize support for its citizens. Community solar allows the city to pool its available resources for a collective renewable energy solution. This approach ensures that a broader segment of the community, including those who may not have the means or ability to install solar panels individually, can still benefit from clean energy and savings.
How do Community Solar Projects Help Rural Areas?
While rural areas often offer more space for large solar farms compared to urban areas, there are many factors to consider beyond just space. The Solar Energy Industries Association (SEIA) states that community solar projects typically utilize leased land, which can be easily restored to its original state. This makes it a more flexible and reversible form of development compared to many other types of projects. Here are some benefits that community solar projects can provide to rural areas:
Create New Sources of Income for Farmers:
Farmers can benefit from leasing a portion of their property for solar development, providing them with a stable and reliable source of income. In this arrangement, farmers typically lease a section of their land for the duration of the solar project, which can extend up to 30 years. Once the solar farm is built, the solar company pays the landowner for the use of their property.
By leasing their land for solar development, farmers can enjoy financial benefits throughout the project’s lifespan. The income generated from the lease provides a consistent source of income. This can help stabilize the farmers’ finances and mitigate the risks associated with fluctuations in agricultural markets.
Furthermore, farmers have the opportunity to become subscribers to the solar project itself. This means that in addition to receiving payment for the use of their land, they can also benefit from lower electricity costs. The specific savings on their electric bill will vary depending on the state and the particular program in place.
Access to Clean Energy:
Individuals living in rural areas often face difficulty in saving money due to factors such as lack of homeownership or financial resources to install solar panels. This is particularly true for residents living on farms with unstable incomes, such as in rural manufactured home parks, low-income housing, or on local lands where many indigenous people may live below the Federal poverty level. These communities often lack reliable and affordable access to energy.
Community solar initiatives offer a solution by providing these marginalized rural residents with access to reliable and clean energy. Through community solar projects, individuals who are unable to install solar panels individually can still benefit from solar energy. The Cannon Ball Community Solar Farm in North Dakota is the best example.
By utilizing community solar, the Sioux Nation community is estimated to save around $7,000 to $10,000 annually in energy costs. These savings have allowed the community to allocate funds towards infrastructure such as a community center and gym. Additionally, the savings have facilitated the establishment of a scholarship program, providing educational opportunities for community members.
Improve Local Economy:
Community solar projects provide steady income and stable jobs for farmers, while also helping to lower local taxes. These projects also provide new training opportunities, stimulating the local economy. Solar farms can help rural and urban communities achieve their sustainable goals without disrupting agricultural production.
Utilizing Untillable Land:
Community solar farms have the potential to effectively utilize land that was previously unusable, such as landfills, generating clean energy from otherwise untillable sites. In rural areas, community solar projects offer renewable energy that can reduce the carbon footprint. These solar arrays can also provide space for bees and birds.
Agrivoltaics is a growing trend in the Western United States and developing countries. This method involves using land for solar power generation alongside agricultural practices. This innovative approach involves installing solar arrays over specific crops that can benefit from the shade provided by the solar panels, such as root vegetables. Agrivoltaics allows for the use of land, promoting both renewable energy generation and agricultural productivity.
Conclusion:
In conclusion, community solar programs empower local communities and foster collective responsibility. These projects address energy inequalities by providing access to clean energy for low-income households and marginalized communities. Through these programs, individuals and businesses can participate in solar energy production, promote sustainability, reduce their carbon footprint, and create opportunities for economic growth.
