Community Solar: The Truth You Need to Know

by Jenny Kim | Last Updated: November 5, 2021
 

Community solar programs allow residents to benefit from solar energy even if they don’t have the space or means to put solar panels on their property.

And chances are, no matter where you live, you’ve seen a community solar garden pop up.

If you’re new to the idea of shared solar power, it can be hard to tell whether signing up for one of these programs is worth your time. (Spoiler alert: it probably is.)

Here’s what you need to know about community solar, how it affects the community, and what it can save you.

What is Community Solar, and How Does it Work?

Community solar is loosely defined as any solar project that benefits multiple residents or businesses.

Here’s a rundown of how it most commonly works:

Programs like these allow renters, apartment building dwellers, and other multifamily homeowners the chance to use solar energy even if they don’t have a roof to place solar panels on. Community solar is also very advantageous for anyone who doesn’t have the means to cover the cost of solar panels.

There are a couple of ways to participate in community solar, including subscription-based and ownership-based models. Here’s how they work.

Subscription Based Community Solar

Subscription-based community solar programs allow you to receive solar electricity up to a specific limit. These programs help you save money on your electric bill, usually 5-15%

While all programs are slightly different, with a subscription-based model, you’ll pay the community solar program a monthly fee. You’ll then receive credits on your regular electric bill based on how much solar power you used for the month.

Community solar programs are free and easy to join. There are typically no start-up fees or cancellation fees.

Ownership Based Community Solar

Ownership-based community solar programs are less common than subscription-based models. These work by allowing community members to purchase a specific amount of panels or enough kilowatts to provide electricity to their homes.

This model is very similar to purchasing your own solar panels. The big difference is that instead of putting them on your roof, they’re in a community solar farm or garden.

What Else is Community Solar Referred to As?

You may also hear community solar referred to as different names, including:

Is Community Solar Better than Home Solar?

Community solar is very similar to home solar in that they both provide your home with electric energy.

The big difference is that through a community solar program, there is no work required from you. You won’t have to worry about financing, installation, or upkeep of solar panels.

This makes community solar ideal for renters or those that live in multi-family homes.

Community solar is also the way to go if you don’t plan on living in the same house forever. For instance, most community solar subscriptions don’t have cancellation fees, so if you move and there’s no coverage in your area, you just cancel your plan. You can’t do that with your own set of financed solar panels.

With home solar panels, you have to purchase or lease your equipment, making monthly payments on it.

Home solar is better if you own your home and plan to be there for many years. On the other hand, community solar is ideal if you rent, live in a multifamily dwelling, or plan on moving in the near future.

Who Runs Community Solar Programs?

Community solar programs are not government-run. Instead, they can be run by utility companies or third-party businesses as long as they follow the state’s rules and regulations.

Here’s how it works:

Each state sets its own rules around community solar.

Do Community Solar Programs Use Solar Farms?

Solar farms are large groups of solar panels that span across several to hundreds of acres.

These extensive collections of solar panels are sometimes called solar gardens and roofless solar panels.

Solar farms and solar gardens provide energy for community solar programs. However, utility companies can also own them and use these solar farms to send electricity to the grid. These are often referred to as power plants. Solar farms owned by the utility company are not community solar.

What are the Benefits of Community Solar?

There are many benefits of community solar. Here is a look at the most common:

Cost Savings

One of the most significant benefits of community solar is the cost savings it provides. On average, most community solar subscribers save 5-15% on electricity compared to their previous costs.

No Up-Front Fees

While individual companies will run each community solar project a little differently, there are typically zero upfront fees to join a community solar program. Compare this to purchasing your own solar panels, and you’d be out thousands of dollars or be making monthly lease payments.

Easy to Join

In comparison to putting up rooftop solar panels, community solar is easy to join. All you need to do is contact a community solar provider, and if you live in an eligible area, you can easily and quickly join.

Fair Access to Clean Renewable Energy

Perhaps one of the most significant benefits of community solar is that it gives fair access to clean renewable energy to groups of people who didn’t previously have access. Community solar is especially beneficial for renters and apartment dwellers.

Support of Local Power Projects

Community solar projects give more control over energy to local sources. They also bring money into the community and can even create jobs.

Pros and Cons

When it comes to any important issue, you need to look at both the pros and cons. There are many benefits when it comes to community solar, but there are also a couple of downsides.

Pros of Community Solar

There are a lot of pros to community solar. The main pro is that community solar gives fair access to solar power across the community and helps residents save money on electricity costs.

Here’s a complete look at the pros:

Cons of Community Solar

Even though community solar has its fair share of advantages, it wouldn’t be fair if we didn’t cover the cons.

Here are the cons of community solar:

In some areas, residents have protested solar farms simply because they don’t like how they look.

How Much Does Community Solar Cost?

Community solar costs vary from region to region but are almost always less than traditional electricity costs. According to the Department of Energy, the median amount of savings of a subscription versus credits is $0.19 per watt used. The average range of savings is $0.16 – $0.25 per watt.

FAQs

Is community solar the same as green power?

Community solar is not the same as green power. Green power is any form of naturally generated electricity. This can be from solar, heat, wind, and more. Green power programs enable you to pay your utility company to use green power, but you’re not using it yourself.

With a community solar program, you benefit from the actual use of solar energy and receive credits on your utility bill. Also, most community solar programs are third-party run.

What is the catch with community solar?

There is no catch with community solar. Community solar programs are free to join and help you save 5-15% on your energy bills. However, the most common complaint about community solar is that residents don’t like how solar farms look and are afraid these farms will negatively impact property values.

How does community solar make money?

Community solar makes money through customer subscriptions. These subscriptions or investor cash are what enable the programs to purchase solar panels initially. Since there are many tax credits for solar energy, the business also takes advantage of that.

When the business pays off the cost of the solar panels, the community solar program will be very profitable while still saving its subscribers money on electricity.

What is bad about solar farms?

Solar farms are large groups of solar panels that provide solar power to the electrical grid or community solar programs. The pushback against solar farms, especially in rural areas, is primarily due to the fear of dropping property values and agricultural land use.

Also, large solar farms that expand over hundreds of acres can adversely affect wildlife and local vegetation.

Who Can I Contact if I’m Interested in Community Solar?

If you’re interested in community solar, try searching on Google to find a program available in your area.

In addition, you can check with these community solar program companies:

 
Jenny Kim - President, joined DC Sun in 2016 with the simple goal of helping make solar power more accessible and affordable to anyone that wants to take advantage of the many benefits. As President, she has led an effort to assist more than 400 homeowners in the Washington DC area to go solar. Jenny holds a Master of Science in electrical engineering from Virginia Tech where she paid her way through college as a top-performing inside sales representative for SolarCity. You can connect with Jenny on LinkedIN.