You’re not alone if you’re considering joining a solar community project. There are plenty of benefits to joining a project. But you should be aware of the regulations associated with community solar before you jump in. This article explores community solar in general and the challenges that can arise when it comes to implementing a project. After reading it, you’ll know whether it’s for you.
Community solar
A community solar project is a system where subscribers purchase a share of the electricity generated by a project. The system has three prominent actors: the project developer, the sponsor, and the subscribers. The developer owns the project, and the subscribers purchase a share of the electricity that the system generates in exchange for a monthly lease payment. In return, they get credit on their utility bills. The community solar system is a hybrid of private and public ownership.
Community solar facilities are typically smaller than five megawatts in electrical capacity, and the number of acres they affect can range from a few hundred to many thousand. They are often installed on leased land and are meant to reduce energy costs for low-income households. In most cases, these systems are reversible. A well-designed system will be able to return to its original state. In addition, community solar helps increase clean, renewable energy availability in California by allowing multiple households to be involved in a larger-scale shared installation.
Challenges of implementing a community solar project
A few key challenges can be overcome before launching a community solar project. First, state laws may not allow virtual net metering and other policies to promote community solar. Second, establishing ownership structures for community solar projects has legal implications. Such ownership structures may affect the project’s eligibility for tax credits and other benefits. Here are some key considerations to make during the planning phase. Once these considerations are addressed, the process can move forward smoothly.
Despite its many benefits, community solar is not without its challenges. While many community members are interested in solar power, they might not be able to install a residential solar system. For example, they may rent in multi-unit buildings, have a poor roof, or live in areas of intense shade. A community solar project may be an effective solution to these challenges in such circumstances. In addition to providing low-income residents with access to solar energy, community solar programs like community solar gardens are often supplemented by other renewable energy programs in the community.
Benefits of joining a community solar project
Investing in a community solar project is a great way to reduce your electricity bill and lock in savings for years to come. You also help clean the power grid while making a small financial investment in a renewable energy resource. In addition to saving money, community solar projects can also benefit electric utilities since they can strategically site roofless solar gardens on the grid. This helps stabilize the grid, saving the utility money.
As a community solar subscriber, you get credits against your electricity bill for the power generated by the shared solar system. Additionally, you can switch to another property if you wish. This is an excellent option if you do not have your own roof space or cannot afford the high upfront cost of installing solar panels. By joining a community solar project, you can be part of a growing movement to promote renewable energy.
Regulations of community solar
The regulatory framework for community solar programs varies from state to state. State regulators govern most programs and set rates and pay-outs for customers. Generally, the rates are related to existing retail rates, but in some cases, customers receive full credit at the retail rate for all energy used during a year. Minnesota, for example, initially permitted customers to receive compensation at the retail rate applicable to the class of customers they represent. Recently, regulators have changed this policy to a uniform solar rate for all customers.
In addition to federal and state securities laws, community solar developers and marketers must comply with various state consumer protection laws. Consumer protection laws vary by state but generally look at the funds raised for the business venture, the transaction offered, and the participants’ inability to influence the enterprise’s success. Unfortunately, the federal government has not formally extended its consumer protection laws to renewable energy, so developers must sift through applicable state law and apply it appropriately.