Community solar is an excellent option if you’re looking for an easy way to benefit from solar energy without the hassle of installing solar panels on your property. With community solar, you can join a group of people who share a solar energy system and enjoy the benefits of clean energy together. It’s a simple and effective way to impact the environment while saving money on energy bills positively. It operates through solar farms that send their monetary value in the form of credits to your electric utility, and you’ll see these on your monthly bill.
Subscribers can buy or rent a stake in the solar panel system and get a discounted rate on their electricity bills. These programs are designed explicitly to deliver annual savings.
The Farm
How does community solar work? Clean energy produced by community solar farms is delivered straight to the local electricity system. Subscribing to the farm allows local businesses, organizations, and homes to earn credits on their utility bills based on their electricity. As clean solar power flows to the grid, it decreases the demand for fossil fuels and the greenhouse gases they produce.
A utility, a private company, or a nonprofit can start solar community farms. They may be owned by the subscribers or the project developer (though it is often more cost-effective to sell the electricity directly to the utility rather than having them on the system). The farms are sized to match the annual electricity consumption of the subscriptions.
After the farm is built, it’s connected to the local utility, and a meter tracks how much energy it produces each month. The utility reads the meter to determine how many bill credits the solar farm is generating for each subscriber (the term used is virtual net metering). As the farm generates more and more credit, the utility rolls over those credits into future electric bills so that the subscriber continues to save on their electricity costs.
The Subscribers
Community solar offers everyone the benefits of clean energy without the upfront cost or hassle of rooftop solar panels. It’s ideal for renters, small businesses, local schools and nonprofits, municipal buildings, and anyone else who can’t or doesn’t want to install their solar. It’s also a great way to offset your energy costs and carbon footprint even if you move homes.
One of the most influential and beneficial ways to reduce your monthly utility bills is by subscribing to a community solar project. It’s a smart move that helps you save money and contributes to a more sustainable future for everyone. Doing so can generate electricity directly from the farm and reduce energy costs. The credits generated by your subscription are reflected on your electric bill from your provider, which can be found in the Marketplace. Your energy provider may have an incentive program that rewards you with a sign-up bonus or discount for joining.
Once the community solar facility is online, it is connected to your local power grid through an electric meter that keeps track of its production. The meter then sends the solar energy to your utility company, which offsets your utility charges and bills.
Unlike customer-owned residential rooftop solar, which often has up-front maintenance costs, community solar projects include those maintenance costs in their subscription packages and pass them on to subscribers. They can also monetize the federal investment tax credit to provide additional savings to their subscribers. Picture a bustling terminal where numerous neighbors benefit from the cost-saving power generated by the community solar farm.
The Utility
Solar community allows anyone to save on their electric bills, even if they can’t install solar panels at home. It includes people who rent or live in a home that needs a better roof, is concerned about shade from trees or homeowners associations, or need help to afford the upfront investment of installing rooftop panels.
Some providers offer sign-up bonuses like bill discounts or gift cards.
Then, your provider will analyze your electricity consumption and determine the size of your subscription. They’ll also communicate with your local utility company to report the energy your share produces for your utility, then credit your monthly bills with these kilowatt-hours (or “solar credits”), reducing your electric charges.
Sometimes, your subscription includes a fixed annual savings rate based on a specific contract term. It helps stabilize your energy costs and protects you against rising utility rates. It can also help you lock in your savings for 20 or 25 years. But most community solar providers don’t require a long-term agreement and let you cancel for free anytime.
The Operator
Community solar is a great way to go solar without a rooftop installation’s upfront cost and roof constraints. Participants buy a share of a local solar project, or “farm,” and get credit on their utility bill for its energy. It is made possible by state renewable energy incentives.
Each participating homeowner, apartment dweller, or business gets credit on their electric bill based on how many kilowatt-hours (kWh) their share of the solar farm generates each month. The credit is applied to their electricity costs through a subscription with an operator, usually an investor-owned or cooperative utility or a special-purpose entity. The operator tells the utility company how much electricity their community solar farm generates each month, and the utility applies those credits directly to your electricity bill.
This system is very efficient and allows more people to enjoy the benefits of solar power than ever before. And it helps clean up the grid, reducing the need for more fossil fuels and greenhouse gas emissions.
Everyone can benefit from community solar, whether they rent or own their homes, live in an apartment, have poor credit, or work for a large corporation. It’s a powerful economic tool that helps the whole community: small businesses, hospitals and schools, religious organizations, and nonprofits can save money while lowering their carbon footprint.
