Photo: Duck River EMC in Shelbyville, TN launches a community solar project near two local schools. If you spend much time toiling in the clean energy field, I’m sure you have heard of community shared solar and community wind. Community renewables is an established and still-evolving segment of the renewable energy market, through which customers invest in a share of a project and receive production-based returns.
Early-on, these projects just gave customers a chance to “vote with their pocketbooks,” to subsidize premium-priced local wind and solar projects. Nobody talked about “payback” on the investment—in fact, one early community solar project in Oregon penciled out with a 70-year return on investment—but still it was fully subscribed. Today, renewable energy costs have greatly declined, so this is no longer mere charity. Project participants typically get a virtual net metering payment from the utility, calculated as if part of the project were up on their own roof. Sometimes they get a payment that more closely resembles a feed-in tariff (FIT) for the kWh output of their share, separate from the utility bill for their monthly energy use. These and a few other business models for community solar and wind create a win-win—a good payback for the individual participant and benefits for the community where the project is based. In some cases, these projects are sited on public buildings or on some other site that offers a distinct public benefit, such as saving on energy bills for a school or non-profit agency, offering equitable energy choices for renters or low-income participants, or driving technical innovations that may not save money right-off, but help the community reach long-term sustainability goals.
Make no mistake: there are a growing number of models for community renewables--more rightly called "shared solar"--that focus mostly on the benefits of the deal--from Mosaic's approach that look a bit like Kickstarter with a payback, to one new community wind project in Texas, which plans to top 1 GW, with hundreds of turbines across a vast landscape. In the excitement over the prospect of big returns, some projects might inadvertently add risks and costs, or of divide communities between customers who can get in on the deal, versus those who cannot. These are all out there. But I am more interested in projects that follow the inclusive motto: “Making clean energy work for consumer-owned utilities and the communities they serve.”
When I had the chance to speak at a Clean Energy Ambassadors webinar on Community Renewables on November 18, I tried to highlight primarily those projects that unite communities around clean energy. In fact, it was a fast-moving hour. We covered some of the most successful utility-based programs, which typically maintain an 85 to 88% subscription rate. And we looked at third party models that start out "going rogue," based on grassroots movements, before they usually settle on an agreement with the utility. We also looked at some of my favorite projects that ask the question, “How can we use community renewables to keep pushing innovation?" How can you—as a utility program sponsor or interested customer—gain the comfort of knowing that your investment in community renewables today is going to feel just as “right” in ten years or twenty years as it does today? I am about to start work on a demonstration project (ed. note: see January 29 blog) that brings community solar together in one program, with demand response, strategic battery storage, and other kinds of smart design, so the project will be affordable and way ahead of its time.
Clean Energy Ambassadors, which is a grant-funded NGO, has put its webinars on hiatus as of January 2015, so we've made it easy for you to find Jill's presentation on under our own "Our Work" tab. Watch for many more resources related to community solar on this site in coming months, or contact us today.
Early-on, these projects just gave customers a chance to “vote with their pocketbooks,” to subsidize premium-priced local wind and solar projects. Nobody talked about “payback” on the investment—in fact, one early community solar project in Oregon penciled out with a 70-year return on investment—but still it was fully subscribed. Today, renewable energy costs have greatly declined, so this is no longer mere charity. Project participants typically get a virtual net metering payment from the utility, calculated as if part of the project were up on their own roof. Sometimes they get a payment that more closely resembles a feed-in tariff (FIT) for the kWh output of their share, separate from the utility bill for their monthly energy use. These and a few other business models for community solar and wind create a win-win—a good payback for the individual participant and benefits for the community where the project is based. In some cases, these projects are sited on public buildings or on some other site that offers a distinct public benefit, such as saving on energy bills for a school or non-profit agency, offering equitable energy choices for renters or low-income participants, or driving technical innovations that may not save money right-off, but help the community reach long-term sustainability goals.
Make no mistake: there are a growing number of models for community renewables--more rightly called "shared solar"--that focus mostly on the benefits of the deal--from Mosaic's approach that look a bit like Kickstarter with a payback, to one new community wind project in Texas, which plans to top 1 GW, with hundreds of turbines across a vast landscape. In the excitement over the prospect of big returns, some projects might inadvertently add risks and costs, or of divide communities between customers who can get in on the deal, versus those who cannot. These are all out there. But I am more interested in projects that follow the inclusive motto: “Making clean energy work for consumer-owned utilities and the communities they serve.”
When I had the chance to speak at a Clean Energy Ambassadors webinar on Community Renewables on November 18, I tried to highlight primarily those projects that unite communities around clean energy. In fact, it was a fast-moving hour. We covered some of the most successful utility-based programs, which typically maintain an 85 to 88% subscription rate. And we looked at third party models that start out "going rogue," based on grassroots movements, before they usually settle on an agreement with the utility. We also looked at some of my favorite projects that ask the question, “How can we use community renewables to keep pushing innovation?" How can you—as a utility program sponsor or interested customer—gain the comfort of knowing that your investment in community renewables today is going to feel just as “right” in ten years or twenty years as it does today? I am about to start work on a demonstration project (ed. note: see January 29 blog) that brings community solar together in one program, with demand response, strategic battery storage, and other kinds of smart design, so the project will be affordable and way ahead of its time.
Clean Energy Ambassadors, which is a grant-funded NGO, has put its webinars on hiatus as of January 2015, so we've made it easy for you to find Jill's presentation on under our own "Our Work" tab. Watch for many more resources related to community solar on this site in coming months, or contact us today.