AMA: How Does Community Solar Work?
An #askmeanything series on Community Solar
My name is Dakota Malone & I co-founded Community Solar Authority.
We’ve unlocked access to over $20M+ in future energy savings for corporations, municipalities, and big businesses using community solar.
From our perspective, community solar is the lowest barrier to entry from benefitting from the clean energy economy.
Due to it’s simplicity, the couple of top questions we get are:
- How Does It Work?
- Why Does This Sound Too Good To Be True?
The purpose of this AMA is to address both of these questions.
How Does Community Solar Work?
Community solar is state-level legislation that helps a given state meet its renewable energy commitments.
States like NY & IL have announced that they’ll be 100% renewable by x amount of time- and they dump state & federal incentives into different programs to help make that happen.
Community solar is one of many programs that help clean the greater energy grid, and it starts with solar developers building solar farms and capturing incentives that make up the trillion-dollar clean energy economy.
Solar assets clean the energy grid to meet the renewable commitments made, and the community solar model allows for multiple subscribers to benefit by participating in the asset.
In exchange for participating in community solar and helping clean the energy grid, the solar developers share a piece of those incentives with you in the form of a bill credit designed to lower utility costs.
This means that you can effectively use community solar as a business sustainability practice and on a $0 investment, without installing solar on your property- can benefit from a hedge against electricity inflation and improved operating costs.
Community solar is a symbiotic relationship between the solar developer and the subscribers. Our company helps large electricity users find available anchor tenant positions, take up most of a solar asset, and serve as a partner to those solar developers looking to build projects.
The solar developer cannot monetize the project without an off-taker, and the off-taker cannot get the bill credits without participation. The model is effective because it gets community participation and allows entities to step towards sustainability while benefitting powerfully.
It’s why major corporations are involved in community solar. Walmart, Home Depot, AT&T, & many other Fortune companies are already involved because they want to claim these incentives while they are available.
The last thing I’ll say is that my company, Community Solar Authority, is a stakeholder in the National Community Solar Partnership- an energy.gov initiative designed to deploy $1B in future electricity savings using the community solar program.
It is a powerful piece of legislation, and we help large electricity users unlock these available incentives turnkey to save an average of ~$25,000+/yr on a $0 investment.
Why Does This Sound Too Good To Be True?
I smile every time I hear this question because I already know it’s coming for anyone’s first time hearing about community solar.
The truth is- it does sound too good to be true, but it’s not.
It is a small piece of the trillion-dollar clean energy economy and is predicted to grow over the next decade.
It is state-level legislation, managed by governing bodies, powered on incentives, and a tool designed for grid flexibility.
You can participate in the legislation and receive bill credits directly back to your utility bill in exchange for being a subscriber in a community solar asset.
Below is a sample bill with a CDG (community distributed generation) credit applied.
Imagine a coupon for your electricity costs, just for capturing incentives while they are available.
The reality is, not everybody can capture these credits, and there isn’t an unlimited amount of them.
When people wrap their heads around the idea that community solar is limited, there are only so many incentives, and the developers building them are sharing a small piece of the pie with the subscriber- all of a sudden it starts to make a lot more sense.
Conclusion
I love answering questions for our clients to help them understand all things community solar.
For the last six years, it’s been a priority for us to keep our clients educated so that they can unlock these incentives while they are available.
Community solar rollouts are the first and easiest step towards sustainability, and it’s what we always explore first for a sustainability strategy with our clients.
Seeking to get more information on community solar? You can get started by booking a complimentary strategy call on our website.
communitysolarauthority.com
