The total installed capacity for community solar programs across the U.S. is expected to reach 1.5 GW in 2020, representing a $2.5 billion market, according to a new report from Navigant Research.
The report says utilities throughout the country have been deploying community solar programs since 2010, offering solar energy to residential and commercial users in multi-story buildings and those without an adequate roof to support solar electricity generation. Community solar is enabled by virtual net metering, which allows consumers to offset part or all of their electricity bills with the electricity produced by the solar project.
“Customers benefit from a solar project that is hosted outside the utility’s premises but utilizes its transmission and distribution infrastructure,” says Roberto Rodriguez Labastida, senior research analyst with Navigant Research. “At the same time, utilities improve customer satisfaction and limit the economic and technical impact that rooftop solar generation can have on their business.”
According to the report, a number of drivers, including lower system cost and sustained demand for clean energy in the residential and commercial sector, create potential for community solar to capture 2% of the solar market. However, the resulting decrease in utility control and increase in retail competition will require a rethinking of current utility business models and their electricity generation mix, the report concludes.