Solar Power to the People: Understanding Community Solar

Published December 15, 2015

Solar Power to the People: Understanding Community Solar

DATE PUBLISHED: December 15, 2015
Category: Blog Article

Community solar projects have been consistently popping up throughout the U.S. and by now, most of us have heard something about it. We understand why everyone is abuzz; community solar is a model that enables property owners, renters and communities to access solar energy, even if they cannot put solar on their roofs or do not have suitable land for a solar array.

In its most basic form, community solar allows you to generate solar power in one location and use it in a different one. Electricity is produced at an off-site solar array and then purchased and consumed by multiple shareholders in that community.

While the mechanics and technology behind community solar may be complex, the concept is really very simple.  We’ve broken it down for you in four easy steps, illustrated below.

  1. Community Solar ExplainedSunlight hits the solar panels in the community solar field, generating electricity.
  2. The electricity generated flows through an on-site meter to the electrical utility grid.
  3. The utility company measures the electricity generated, calculates a dollar value for the power, and distributes this dollar value proportionately to the members of the community solar program (residents, businesses, municipalities and institutions).
  4. The value of the solar electricity produced from the array is applied as a monetary credit to each member’s electric bill.

Even with a simple understanding of community solar, there are many questions left to answer. We explain the details of ommunity solar below.

Who can participate in Community Solar?

Virtually anyone can participate in community solar, provided the property consuming the energy is located in the same part of the electric grid (load zone) as the community solar array.

What are the benefits of Community Solar?

Community Solar allows people to take advantage of reduced electricity rates and clean energy without having to install or own a solar array on their property. It also allows people who may not own property to save money on their electric bill and support renewable energy.  Community solar is great for cities or towns who wish to power buildings such as a school, town hall, police station or other facilities, and is also beneficial to individual homeowners, renters and businesses who wish to offset their existing electric bill with solar energy.

If I join a Community Solar program, do I have to buy solar panels?

No; the great thing about community solar is that members can take advantage of reduced cost, clean energy without purchasing solar panels. Typically, the solar array is owned by a solar company or third party investor who builds the array on a field or on a large commercial rooftop. The owner of the array then sells the electricity to members of a community who want to buy renewable solar energy.

How does Community Solar effect my electric bill?

Community solar will usually lower your electric bill, and allows you to enjoy renewable solar energy. Each billing cycle, your utility company will deduct the assigned value of your percentage of the electricity generated from your bill, charging you only for the electricity consumed beyond that level. If there is a remaining balance on your utility bill after the value of the solar credit has been applied, you would remain obligated to pay the remaining balance on the Utility bill.

So how do I pay for my solar electricity?

As a community solar member, you will also get a bill from the owner of the community solar project, charging you for the credit they have applied to your electric bill.  The benefit of community solar is that you purchase a dollar credit at a discounted rate. For example, you would pay for electricity generated by the community solar project at a discounted rate of $0.85 for $1.00 worth of energy – ultimately saving 15% off your electric bill. Think of it like a Groupon for solar – where you might pay $10 for a $20 gift certificate.

During particularly sunny months, your solar credits might exceed your electricity consumption. In that case, you remain obligated to pay the solar company for the credit assigned to your account. Any unused credits will roll over month to month, and they never expire.