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Background

For many potential solar customers, installing a system at their home or business may seem impossible or undesirable. On-site systems require certain roof and site characteristics—such as adequate unshaded space—and rely on permission from the property owner, who may not live or work on the property. Community solar programs give customers alternative pathways to access solar by enabling them to share solar generation from an on- or off-site solar energy system with multiple end users.

What is community solar?
The Smart Electric Power Alliance defines community solar as “a voluntary program whereby a solar-electric system provides power and/or financial benefit to multiple community members in which community members may or may not own the system itself.”

Through Solar Market Pathways, projects worked to:

  • Enable more people, businesses, and communities to participate in community solar programs.
  • Develop and implement programs in markets that have not previously had community solar.
  • Identify best practices and consumer preferences to improve existing program models.
  • Standardize community solar models to reduce costs and simplify program development and implementation.
  • Provide technical assistance to expand and improve utility-administered community solar programs.
  • Enhance the value of community solar programs by integrating demand response.

Toolkit

This toolkit provides a suite of resources to guide the development of, and investment in, community solar and equip diverse stakeholders with tools to navigate relevant policy issues, program design and implementation, and consumer and community engagement. The resources in this toolkit are built for the audiences they serve—utilities, policy makers, investors and financiers; the renewable energy industry; and residential and non-residential end users. The toolkit may also be helpful for community groups and local governments interested in advancing community solar in their respective localities.

Fundamentals of Community Solar

Community solar, also known as shared solar, represents a promising frontier in the expansion and acceleration of solar deployment nationwide. Community solar programs give consumers an alternative to placing solar on their own property and enable multiple participants to benefit from electricity generated by a shared solar energy system that is typically located off site. These programs offer great potential for long-term growth—between 2015 and 2020, cumulative community solar installations could constitute 5.5-11 GW of solar PV for residential and non-residential customers.[1]

As a starting point for those who want to develop community solar projects, the National Renewable Energy Laboratory produced A Guide to Community Solar, providing a detailed overview of the different community solar ownership models for utility, private, and nonprofit projects. The tools in the Solar Energy Resource Center provide an overview of key concepts, offering a helpful resource for those seeking to learn more about community solar issues, program designs, and models.

Resources

Tool:
A Guide to Community Solar: Utility, Private, and Non-profit ... A Guide to Community Solar: Utility, Private, and Non-profit Project Development
Author:  NREL

This guide provides an overview of the different community solar ownership models.

Report:
Community Solar Opportunity Assessment for Cook County Community Solar Opportunity Assessment for Cook County
Author:  Cook County

This analysis quantifies the shared solar market potential by site, characteristics or type, subscriber type, and ownership model in the county.

Policy

Before beginning a community solar project, decision-makers and stakeholders should take into account important policy issues that affect program design and implementation.

The National Renewable Energy Laboratory created a report that examines the current U.S. shared solar landscape and provides an estimate of market potential for U.S. shared solar deployment.

Various policy options—including virtual net metering, group net metering, meter aggregation, and group billing—enable community solar. Colorado, California, Maine, Massachusetts, and Vermont serve as case studies of enabling community solar policies. A comprehensive summary of California’s Virtual Net Metering Tariff for general market multi-tenant units also offers an overview of other state virtual net metering and community solar policies across the country, and the Center for Sustainable Energy created a report exploring ways to expand virtual net metering, a policy enabling multi-family tenants and building owners to participate in community solar.

Resources

Report:
Community Shared Solar: Policy and Regulatory Considerations Community Shared Solar: Policy and Regulatory Considerations
Author:  NREL

This paper explores the ways in which the shared solar business model interacts with existing policy and regulations and provides options for creating a supportive policy environment.

Report:
Community-Scale Solar: Why developers and buyers focus on this ... Community-Scale Solar: Why developers and buyers focus on this high-potential market segment
Author:  RMI

This report highlights the potential for community-scale solar (0.5–5MW projects) and the key attributes and opportunities associated with this untapped market.

Report:
The Ecology of Community Solar Gardening: A ‘Companion’ Planting ... The Ecology of Community Solar Gardening: A ‘Companion’ Planting Guide
Author:  National Regulatory Research Institute

This report provides an overview of community solar activities around the country, highlighting state activities as well as utility-led initiatives.

Report:
Virtual Net Metering Policy Background and Summary Report Virtual Net Metering Policy Background and Summary Report
Author:  Center for Sustainable Energy

This report summarizes California’s Virtual Net Metering Tariff for general market multi-tenant units and provides an overview of VNM and community solar policies across the country.

Report:
Policies to Support Community Solar Initiatives: Best Practice ... Policies to Support Community Solar Initiatives: Best Practice to Enhance Net Metering
Author:  Center for Energy and Environmental Policy

This report examines policy options to enable community solar, including virtual net metering, group net metering, meter aggregation, and group billing through state case studies.

Report:
California NEM-V Market Assessment California NEM-V Market Assessment
Author:  CSE

This report assesses the current NEM-V Market within CA and highlighting potential market developments that could support greater NEM-V adoption throughout the state.

Report:
Shared Solar: Current Landscape, Market Potential, and the Impact ... Shared Solar: Current Landscape, Market Potential, and the Impact of Federal Securities Regulation
Author:  NREL

Overview of the shared solar landscape and estimate of market potential for the U.S., and the impact a shared solar program’s structure has on requiring federal securities oversight.

Program Design and Implementation

There are many ways to design and implement a community solar program involving different business models, program design considerations, and project implementation tools.

The State Shared Renewable Energy Program Catalog assists policymakers, regulators, and other stakeholders in understanding the details of existing and proposed state shared-renewables statutes and program rules.

Under the U.S. Department of Energy’s National Community Solar Partnership, utility cooperatives and developers installed solar in local communities. These organizations worked to streamline procurement, coordinate installation, drive down solar costs, and make solar more accessible for residents of all income levels. It is important for these organizations—developers, utilities, and nonprofits alike—to consider barriers to participation—such as income level—for potential energy program customers. Enabling policy guidelines and program design recommendations help ensure community solar programs are designed to be effective for all end users, especially low- to moderate-income consumers.

To foster utility-led community solar models closely aligned with the needs and interests of consumers and stakeholders, the Smart Electric Power Alliance published a report on 12 key community solar design decisions, surveying existing community solar programs and providing case studies for the most prevalent models. The types of utility-owned community solar projects outlined in this report are becoming increasingly prevalent across the U.S., especially among publicly owned utilities.

Community solar projects can also be designed to help utilities avoid costly engineering solutions and provide regional-level ancillary services. New business models can increase the scale, reach, and value of utility-based community solar. Utility solar program managers can include appropriate demand response measures to enhance the value of distributed solar and utility-driven community solar. Community Solar Value Project’s pricing model fact sheet provides a side-by-side comparison of community solar pricing strategies at seven utilities nationwide.

Resources

Report:
Community Solar Best Practices Analysis Community Solar Best Practices Analysis
Author:  Cook County

The study identifies model programs and national best practices in Community Solar and provides a baseline framework for policy positions to accelerate community solar in Cook County.

Tool:
Multifamily Solar Market Development Plan Multifamily Solar Market Development Plan
Author:  CSE

This plan is intended to help policymakers, regulators, local governments, multifamily stakeholders and others in CA and beyond to expand multifamily solar in their jurisdictions.

Case study:
Project Makes Solar Ownership Possible for More Customers in ... Project Makes Solar Ownership Possible for More Customers in Lansing and East Lansing
Author:  ISC

An overview of Michigan Community Solar’s work under the U.S. Department of Energy’s National Community Solar Partnership to develop a large solar installation in the community.

Case study:
Bringing Community Solar to Virginia Bringing Community Solar to Virginia
Author:  ISC

An overview of BARC Electric Cooperative’s work under the U.S. Department of Energy’s National Community Solar Partnership to bring the first community solar project to Virginia

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Webinar:
Tools You Can Use for Community ... Tools You Can Use for Community Solar Webinar
Author:  ISC, IREC

An overview of the Community Solar Toolkit and case studies by SMP awardees featuring innovative tools and approaches to advance community solar programs across diverse markets.

Tool:
Community Shared Solar: Implementation Guidelines for Massachusetts ... Community Shared Solar: Implementation Guidelines for Massachusetts Communities
Author:  Massachusetts Department of Energy Resources

This comprehensive guide is intended as a resource for project organizers seeking to implement community solar projects in their community.

   
Report:
Model Rules for Shared Renewable Energy Programs Model Rules for Shared Renewable Energy Programs
Author:  IREC

A consolidated overview and discussion of community solar program design components and an adaptable template for policies and rulemaking purposes.

 
Case study:
Solar Success for Nonprofit Utilities: Grand Valley Power’s ... Solar Success for Nonprofit Utilities: Grand Valley Power’s Low-Income Community Solar Program
Author:  SEPA

This case study spotlights the Grand Valley Rural Cooperative Community Solar project in Colorado completed in partnership with GRID Alternatives.

 
Report:
Texas Community Solar Guidelines for Cooperatives and Municipally ... Texas Community Solar Guidelines for Cooperatives and Municipally Owned Utilities
Author:  North Central Texas Council of Governments

A summary of community solar, its recent growth in Texas, technical resources to reference, and an overview of the major community solar decision points.

 
Tool:
Utility Community Solar Handbook Utility Community Solar Handbook
Author:  SEPA

An overview of the utility’s perspective on utility managed community solar program development and the major design elements the utility needs to address during program development.

   
Tool:
Pricing Model of Interest for Utility-driven Community Solar ... Pricing Model of Interest for Utility-driven Community Solar Programs
Author:  Community Solar Value Project

This table provides a side-by-side comparison of community solar pricing strategies at seven utilities nationwide.

Report:
Shared Renewable Energy for Low-to-Moderate-Income Consumers: ... Shared Renewable Energy for Low-to-Moderate-Income Consumers: Policy Guidelines and Model
Author:  IREC

This report provides an overview of key barriers to LMI customer participation in shared renewable energy programs and key policy guidelines and program design recommendations.

Report:
Community Solar: Program Design Models Community Solar: Program Design Models
Author:  SEPA

This report provides an overview of community solar program models through 12 key design decisions and discusses what options are most prevalent. Case studies of each model type are provided.

Report:
Incorporating Demand Response into Community Solar Programs Incorporating Demand Response into Community Solar Programs
Author:  Community Solar Value Project

This report assists utility solar program managers in including appropriate demand response measures to enhance the value of distributed solar.

Case study:
Crowdfunding Models Brings Solar to Community Organizations in ... Crowdfunding Models Brings Solar to Community Organizations in Appalachia
Author:  ISC

An overview of Solar Holler’s work to develop a creative crowdfunding model to leverage revenue from energy efficiency to put solar on nonprofit buildings.

 
Case study:
Leveraging Funding Sources to Bring Solar to Low-Income Households ... Leveraging Funding Sources to Bring Solar to Low-Income Households in Minnesota
Author:  ISC

An overview of Rural Renewable Energy Alliance’s work to provide weatherization, solar thermal and solar electric systems for low-income households.

 
Case study:
Bulk Purchasing Power for Cape Cod Communities Bulk Purchasing Power for Cape Cod Communities
Author:  ISC

An overview of Cape & Vineyard Electric Cooperative’s work to streamline procurement, coordinate installation and drive down costs of solar in the community.

 
Case study:
Shared Solar for the Community Shared Solar for the Community
Author:  ISC

An overview of Kit Carson Electric Cooperative’s work to engage their community to bring a solar array to residents of multiple income levels.

Finance

There are many important financial considerations and opportunities for community solar, including low-income community solar financing.

Understanding project finances is an important step in designing a community solar model. The Community Solar Business Case Tool provides a flexible financial model that projects the costs and benefits to the system developer and subscriber of a single community solar project. Stakeholders can use this tool to determine the value proposition of investing in community solar.

The Cook County Department of Environmental Control, with support from the National Community Solar Partnership, polled various regional and national stakeholders to develop the Shared Solar Value Proposition, which contains an analysis of the value proposition for subscribers and developers and an overall summary report of the value proposition for community solar.

Finding a workable bill-crediting mechanism has been a barrier for Cook County, as manual or fully automated processes are too burdensome for the utility. The Utility Billing Impacts of Community Solar analyzes the potential bill-crediting processes for subscriber management of community solar projects. This analysis offers the potential to develop a significantly less costly semi-automated process.

Utility-led community solar programs have options for structuring and financing that vary based on the structure of utility (investor-owned, municipal utility, or cooperative), state policies, and upcoming changes to the federal solar tax incentives.

Resources

Report:
Shared Solar Value Proposition – Part I Shared Solar Value Proposition – Part I
Author:  Cook County

This document contains the analysis of the value proposition for subscribers and developers and an overall summary report of the value proposition for community solar.

Report:
Shared Solar Value Proposition – Part II Shared Solar Value Proposition – Part II
Author:  Cook County

Building from Part I, this analysis includes utility impacts and provisions of the 2016 legislation. Results show a positive business case for system owners and subscribers.

Tool:
Private Letter Ruling on the Eligibility of an Individual Panel ... Private Letter Ruling on the Eligibility of an Individual Panel Owner in an Offsite, Net-Metered Community-Shared Solar Project to Claim the Section 25D Tax Credit
Author:  Internal Revenue Service

From the Internal Revenue Service (IRS) determining that an owner of PV panels in an offsite community shared solar garden is eligible for the residential tax credit.

Tool:
Stoel Rives Memorandum to NREL RE: Securities Law Issues Relating ... Stoel Rives Memorandum to NREL RE: Securities Law Issues Relating to Community Solar Projects
Author:  Stoel Rives LLP

A legal memo issued to NREL discussing the federal securities legal issues surrounding community solar development.

 
Report:
Utility Billing Impacts of Community Solar Utility Billing Impacts of Community Solar
Author:  Cook County

This report analyzes the potential bill-crediting processes for subscriber management of a community solar project.

Consumer and Community Engagement

A successful community solar program relies on effective outreach and education, which can include project-specific marketing.

The Smart Electric Power Alliance provides insights into consumer preferences for solar in a summary report of two new surveys of U.S. energy customers. It includes methods for identifying and marketing to the right audiences for community solar. To engage contractors, property owners, and developers, the Multifamily Online Solar Marketplace offers a process to simplify complex multifamily solar projects by providing resources and assistance for making smart solar decisions, and to help property owners easily gather and compare solar quotes. Multifamily and contractor toolkits featuring roadmaps, checklists, and worksheets guide solar deployment for apartment and condominium communities. These toolkits also include interconnection resources and a group of interactive multifamily density maps to aid in targeting outreach regions and acquiring customers.

Resources

Tool:
Consumer Protection Trio Consumer Protection Trio
Author:  IREC

The Consumer Protection Trio spotlights safeguards and pointers for buyers, government agencies, the industry, retailers, and others.

Tool:
Guide to Land Leases Guide to Land Leases
Author:  SEIA

A guide for landowners to help them understand the opportunities and implications for leasing their land for solar development.

Tool:
Residential Consumer Guide to Community Solar Residential Consumer Guide to Community Solar
Author:  SEIA

This consumer guide provides a brief overview of key terms in agreements, questions to ask solar professionals, and other issues to consider when choosing community solar programs.

   
Report:
What the Community Solar Customer Wants What the Community Solar Customer Wants
Author:  SEPA

This report highlights findings from two new surveys of American energy customers regarding solar energy, with a focus on community solar.