Community solar lets you benefit from clean energy without a costly installation. It uses virtual net metering to offset the electricity you consume through your utility bill with solar credits. Subscribers (individuals, businesses, municipalities, co-ops/condos) receive credits on their monthly electric bills. These credits are based on the amount of clean energy the community solar project generates.
It’s a Group Purchase
With community solar, you “subscribe” to a local project, often located on capped landfills or open fields in your utility service area. These projects offset your electricity usage with solar energy credits, reducing your utility bill. Subscribers essentially pay for their share of the community solar farm’s energy production at a discounted rate, typically 5 to 15% below standard electricity rates. The discounted amount is then applied to your utility bill each month, lowering the total amount you owe to the utility. Because community solar farms produce power based on seasonality, your monthly credit billing may fluctuate.
Community solar can benefit residents and businesses (including schools, hospitals, religious organs, and non-profits). By reducing their energy bills, they can save money while supporting a cleaner, more sustainable, and resilient grid. Community solar is also a great way for low-income residents to participate in a clean energy solution, which historically has been more limited to wealthier residents. It is a major benefit since polluting fossil fuel plants are often built in disadvantaged communities with lower incomes and people of color, who suffer the most from the pollution. With community solar, these residents can finally say no to dirty fossil fuels and choose to rely on cleaner energy.
Many community solar programs provide participants with credits that are applied to their electric bill at a discounted rate. It can save homeowners (or renters), businesses, municipalities and other organizations on utility bills. Community solar programs are more affordable than rooftop options because they don’t require upfront costs or installation fees on your home. You sign a subscription agreement, and your electricity provider covers the rest. Plus, there are typically no cancellation fees if you want to cancel your program. A subscriber organization – a third-party company that manages community solar projects for subscribers – bills your electric company each month, reporting how much electricity your share of the array produced that month. Then, the utility uses those kilowatt-hours to offset its dependence on fossil fuels or brown power and lower electricity rates. The monetary credits that you receive are thanks to your local government and state-legislated renewable energy incentive programs. These credits are then used to discount your energy cost at the point of sale, allowing you to get a great deal on your electricity.
Community solar is also available to people who can’t install their rooftop solar panels, making it accessible for more households than ever. It’s ideal for individuals with a low credit score, those who live in multi-tenant buildings or cannot afford to alter their roofs, and more. Unlike green power rates, which generally only allow you to choose from a handful of different renewable options and are not necessarily tied to local sources, most community solar programs are rental- or subscription-based. It means you won’t be able to access most of the same solar rebates and incentives available to homeowners who own their systems.
Community solar projects pump clean energy into your local electric grid. Residents, businesses and organizations can subscribe to these farms and get credit for some of their electricity. These credits are then applied to the electric bills they receive from their local utility company. In most states, these credits are discounted to reflect the value of clean energy. So, by going solar with a community solar program, you’re saving money and supporting new projects that create jobs in your backyard. These professions can help us rely less on brown power and fossil fuels. They can also make our local communities more resilient during weather events like heat waves and storms.
The different types of community solar offerings vary by state and even utility area. Some offer a fixed discount on the bill credits you receive (like 10%), and others have savings built into the rates offered by your provider. Once enrolled in a community solar program, your kilowatt-hour credits are delivered monthly to your local electric utility company. They are reported on the bill as “Renewable Energy Credits.” You’ll continue receiving one electric invoice from your provider, with an additional line item showing how many kilowatt-hours of community solar credits you received.
Community solar is so sustainable because, unlike green power options offered by your electric utility, you do not sign up for it to “do the right thing.” Instead, your participation helps save you money. The company that manages your community solar project subscription delivers these credits to you. The company then reports the amount of electricity generated to your local utility. Depending on your location and subscription structure, you may receive a separate monthly statement from the project along with your regular electricity statement. In other cases, the community solar credits are subtracted from your average electricity bill. Either way, the savings add up, as does the environmental benefit. Whether through community solar or panels on your roof, solar energy avoids harmful air pollution emissions. That helps reduce the toxins contributing to rising temperatures and extreme weather events in our communities.