How Community Solar Works

You might be thinking, “Community solar? Is that when my neighbors all go outside to catch some rays together?”

You could be forgiven for thinking that, as community solar is one of the nation’s most impactful but lesser-known clean energy sources. Community solar is defined as any collection of solar panels that produces energy for multiple families, businesses, or other buildings within an area. These types of projects allow communities that might not have the ability to purchase rooftop solar to get cleaner and cheaper energy from the sun.

Community solar projects always provide energy through solar power within a certain geographic area. However, they can take on different forms; they can be owned by a developer, utility company, or even the local community. This is our favorite form of community solar because it provides subscribers with the greatest number of benefits — locally owned community solar projects can keep money in the community, improve local grid resilience, and create local jobs. 

Community solar projects led by developers or utility companies can still offer more than just affordable, clean energy. When developers collaborate with local communities to create a Community Benefit Agreement (CBA), the project can bring additional benefits that support local residents. These agreements can be designed to ensure that communities see real value beyond the energy savings. For example, CBAs can include commitments to hire people from the local area, contribute to community funds, or provide job training programs. When done right, communities and developers can create projects that provide clean energy and boost local economies and job opportunities.

The bottom line is clear, regardless of the owner: Community solar provides subscribers with cheaper, cleaner, and more reliable energy.

Benefits for Renters and Low-Income Households

Community solar projects also address the barriers to access faced by nearly 75% of Americans who either don’t own their home, don’t have rooftop space, or face financial barriers. Renters can often subscribe to community solar programs, allowing them to save on energy bills while still making a green choice that renters usually don’t feel they have. For example, this Baltimore school is aiding the low to middle-income folks in their community using community solar by sharing its solar system with local communities. The project is expected to save these families $200 a month and $1.1 million over the project’s lifetime.

Do you rent, and are you interested in making more eco-friendly choices? Our guide has more options for electrifying as a renter.

Community solar also addresses one of the most fundamental solar issues: the high upfront cost. Even with great incentives like the federal tax credit for up to 30% off the solar installation cost, with an average upfront cost of $30,000, residential solar can still be out of reach. 

That’s where community solar comes in! With no major upfront costs and a subscription model, community solar presents a much more approachable way to get cleaner power for your home or business. Some states have even created “carve-outs,” requiring that a certain percentage of solar power goes toward lower-income communities. Maryland’s community solar law requires projects to give 40% of their capacity to low- to moderate-income households (with at least a 10% discount) and mandates utilities to handle consolidated billing. As community solar continues to grow, it is essential to ensure that lower-income households are able to subscribe and benefit. Explore community solar options in your area. 

Community Solar In Action

In a partnership between the City of Denver, Denver Public Schools (DPS), and Energy Outreach Colorado (EOC), five schools and 72 families are now subscribed to the Renewable Denver Community Solar Program at no cost, collectively saving over $63,000 annually and reducing their electricity costs by 64%. Over the next year, five more DPS high schools will become community solar sites with solar panels and electric vehicle chargers. All of the energy generated from these sites will be donated to Denver Public School families to relieve their energy bills. Once fully developed, the Denver Community Solar Program will serve approximately 450 local families. This story is just one example of the many ways community solar benefits families, schools, and businesses throughout the country. Here’s another example at a Minnesota high school. 

Ready to explore how to tap into the benefits of community solar? Check out Energy Sage’s resources below to find and choose a local community solar project near you!

While you’re at it, dive into the first part of this series about the green tech we love—heat pumps and induction stoves.