Community solar offers to bring clean energy to the masses
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GOLDEN, Colo. — The sun is out and so are the solar salesmen. They wander door to door promising home owners lower electric bills and energy independence, all while helping the planet.
Not everybody is happy with their rooftop solar, but for many, the benefits are real.
According to EnergySage, installing solar panels can save homeowners anywhere from $31,000 to $100,000 over 25 years.
But a study by the National Renewable Energy Laboratory (NREL) indicates that nearly half of U.S. households and businesses are unable to host a photovoltaic system — i.e., solar panels on their property — because their roof is too old, steep or shaded, or because of restrictions from homeowners associations. That data do not include the roughly one-third of Americans who rent.
But community solar offers a solution, bringing the benefits and savings of solar to all.
This is how it works: Developers build large solar arrays that feed energy into the electrical grid.
Customers who live near the solar array pay for a subscription, receiving a share of the electricity the panels generate.
Subscribers then earn a monthly credit from their utility company for the energy the panels produce. This credit is typically subtracted from their utility bill. Subscribers save 10% on average.
In May, Rocky Mountain PBS spoke with Sudha Kannan, a researcher at NREL who oversees the agency’s nationwide database of community solar projects to understand how the model works and what consumers should look for in community solar projects.
“Community solar helps people who cannot install panels on their own property for a variety of reasons. They could be in a rental property, an HOA or condo association would not allow them, or just because the roof is really old and it's not capable of mounting solar panels,” said Kannan.
Where are these arrays located?
Community solar arrays are typically built off-site from where subscribers live. Subscribers check with their utility to see if they have a community solar project, then sign up.
But Kannan said that right now, “not all [utilities] have a project that's large enough to support all the residents in a particular area.”
Colorado is currently home to 177 community solar projects with the capacity to produce 272.32 megawatts-DC, enough to power roughly 52,000 homes. The number of homes a single mega-watt is capable of powering varies state to state by average electricity consumption and the efficiency of solar panels.
In the United States, 44 states including the District of Columbia have a community solar project, but community solar projects generate only enough electricity to power one percent of U.S. households.
And 75% of the total capacity is concentrated in just four states: Florida, New York, Minnesota and Massachusetts, said Kannan.
How do the costs of subscribing to community solar compare to traditional utility costs in Colorado?
Kannan said that costs vary widely by community solar projects.
In many cases, subscribers pay less for energy from a community solar project than the retail price for the same number of watts.
EnergySage estimates that community solar subscribers save between 5 and 20 percent on their annual electricity bill.
Unlike residential solar, community solar subscribers don’t have to pay for installation of panels.
Why haven’t we seen even more projects?
According to Kannan, there are a lot of barriers to permitting and building community solar arrays.
“Things can get delayed a lot, and so projects can be in the queue before they're being energized,” she said.
Another problem is connecting developers with financing, she said.
Twenty-four states, including Colorado, passed laws related to community solar. Such legislation can make developing community solar projects smoother, said Kannan.
Laws passed in Colorado, like Senate Bill 24-207, mandate that community solar developers reserve at least 51% of each community solar project for income-qualified residential subscribers and prevent solar companies from denying subscription to customers based on credit score or home ownership status.
Other legislation, like House Bill 19-1003, expands the size of community solar gardens.
What should consumers ask if they’re thinking about subscribing to a community solar project?
“One of the things that consumers need to consider is the contract terms. Some of the community solar projects might have a long term commitment. Some might have sign up fees, subscription fees and some of them don't,” said Kannan.
Kannan said consumers should also ask about are whether the project offers guaranteed savings and what the penalties are if a customer moves or decides to end the contract.
Type of story: Explainer
Provides context or background, definition and detail on a specific topic.
Provides context or background, definition and detail on a specific topic.
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