SEPA: Community Solar Is Growing Exponentially, But There Still Isn’t Enough Of It

Community solar capacity in the U.S. more than doubled between 2016 and 2017, according to a new report from the Smart Electric Power Alliance (SEPA).

Community solar grew from 347 MW at the end of 2016 to 734 MW at the end of 2017. At present, 228 utilities in 36 states have active community solar programs, according to SEPA.

These figures are part of findings in SEPA’s “Community Solar Program Design Models” report, one of two new reports highlighting the growth – and growing sophistication – of community solar programs across the U.S.

The second report, “Value Stacking in Minster,” is a SEPA case study focused on how the small town of Minster, Ohio, put a community solar project on hold in response to a key industrial customer’s request for green power – but continues to explore opportunities for a shared solar project.

The design models report, which includes research findings developed in collaboration with the Coalition for Community Solar Access (CCSA), finds that in 2015, utilities administered 60% of all community solar programs, versus 40% for third-party organizations. However, that split has since flipped: Third parties now account for 67% of community solar programs, versus about 33% for utilities.

The average subscription rate for community solar projects is 83%, with subscription rates for third-party-owned community solar over 90%. Subscription success depends on a range of program design elements, but a project’s financial value proposition remains a major driver, according to the report.

SEPA says utilities are starting to explore the use of community-scale, distributed solar as a grid asset for improved reliability and grid support services. In Minster, a community-based project combining solar and storage has allowed the town to generate four separate value streams from a single project.

Lastly, the report finds that many community solar projects in service are targeted at low- to moderate-income customers, renters and residential customers who live in multifamily buildings. In the past, these customers have been unable to access the benefits of solar because they don’t own their roofs, or if they do, their roofs cannot support solar.

“Despite community solar’s rapid growth, these shared projects constitute just over one percent of the total U.S. solar market,” notes Dan Chwastyk, SEPA’s program manager for community solar programs. “However, we see continued growth ahead because community solar is such a flexible business model, allowing utilities and third-party developers to customize offerings based on local markets and customer interests. Our research and case studies show that the more tuned-in to their customers utilities are, the more innovative and successful their programs become.”

“Community solar is growing exponentially,” adds Jeff Cramer, executive director of CCSA. “As this report demonstrates, the vast majority of community solar projects are either sold out or close to it. While we’re thrilled to see the industry meet and beat its growth expectations, and see new community solar programs open across the country, still only a small fraction of American customers can choose solar today. We expect that to change and community solar, at scale, to play a leading role.”

“Community Solar Program Design Models” is available for download here, and “Value Stacking in Minster” is available here. Both reports were funded by the U.S. Department of Energy’s Solar Market Pathways initiative.

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