What is Community or Shared Solar?
Community solar, sometimes called shared solar, is a novel approach to mass marketing solar energy without the need for costly or inconvenient rooftop installations.
Conventional rooftop solar is feasible for a small percentage of residential and business consumers. No more than 10-15% of structures are suitable for rooftop installations.
The obstacles to rooftop are many and commonplace:
· Roofs in bad condition or in need of replacement over the next 10-20 years;
· Roofs that are in shade from trees, telegraph poles, flagpoles, or HVAC equipment;
· Roofs that face north or east and do not receive enough insolation or sunlight during the day;
· Roofs that are too steep for installers;
· Roofs that are made of materials like Spanish tile that may require costly or dangerous roof penetrations;
· Roofs that are too small, for example, the top of multi-story apartment buildings;
· Roofs that do not have enough structural support to bear the weight of panels; or
· Roofs that are cluttered with other equipment.
Even if a roof is suitable for solar panels several other factors may stand in the way of conventional rooftop installations, such as:
· Aesthetic concerns by the building owner;
· Permitting obstacles by local historical commission;
· Restrictions imposed by housing associations;
· Concerns about making a 20 year commitment;
· Concerns by building owners that tenants may leave within next 20 years;
· Desire to be flexible and be able to move without potential penalty or need to assign the solar agreement to another homebuyer, for example;
· Cost; and
· Inconvenience to tenants and homeowners.
Community or shared solar systems are available to all consumers irrespective of the condition of the roof or local permitting or other obstacles. Community or shared solar can be enjoyed by renters, tenants in multi-family apartment buildings, homeowners whose rooftops are unsuitable for solar, and businesses with short term leases.
With community or shared solar, solar panels are installed on non-contiguous land or rooftops. The solar electricity produced is sold to the local utility which then credits the value of the solar energy to homes or businesses that voluntarily participate in the community or shared solar program. The consumer pays two bills: One to the utility for their electricity with the bill reduced by the amount of the credits awarded by the utility; and a second to the solar developer.
The solar developer might be paid in the form of a price per kilowatt hour of solar electricity generated by the remote solar facility. Or the consumer might buy the solar panels used at the remote facility.
Technically, consumers who participate in a community or shared solar program are not buying solar energy. They are buying electricity off the grid, not from the remote solar farm or rooftop. They are receiving the benefits of solar, not the solar electricity itself.
Community or shared solar provides consumers with more flexibility than with most rooftop installations. With the exception of community solar facilities in which consumers purchase the panels used to generate electricity, buyers of community or shared solar can cancel their supply contracts at any time.
If residential consumers move within a utility territory they may take their solar credit agreement with them. Or if they move outside the territory they can cancel their supply contract without penalty.