Individual rooftop solar panels have become a more familiar sight over the past several years. But not everyone has the correct south-facing rooftop, and renters are out of the market entirely. Now, a new model of community-based solar ownership is beginning to bring solar’s energy-bill savings to a broader audience. Developers are incorporating a range of financing and ownership structures for these new solar “gardens.”
The concept is pretty simple: if you don’t have a place to put your own photovoltaic (PV) panel, you can invest in a group array or, in some cases, buy an actual panel in an array. Depending on state laws, benefits can include net-metered electricity bill reductions and investment gains realized through the sale of related renewable-energy credits. In some states, homeowners may have the option of “subscribing” to the garden’s electricity output to ensure a certain percentage of their household’s supply is being provided by this community resource.
The Sacramento Municipal Utility District (SMUD) in California developed the first solar garden. The utility wanted to meet the needs of residents who had surrounded their homes with shady trees to reduce solar heat gain, a practice the city encouraged. Additionally, the utility wanted to address the needs of renters unable to add PV panels to the roofs of the homes they rented. SMUD-program participants now pay a premium to ensure a portion—up to 50 percent—of their electricity comes from panels in the new “garden.”
Since SMUD’s first effort, the idea of solar gardens has begun spreading across the country, as other states have adopted laws and regulations supporting the concept and outlining related financing regulations. The Clean Energy Collective (CEC), based in Carbondale, Colo., is an early leader in this emerging trend. This group operates in the service territory of Holy Cross Energy, the electric cooperative providing electricity to the Vail ski resort, among other western Colorado customers.
CEC’s initial idea emerged when a local developer began investigating net-zero approaches for a 90-home subdivision, according to Lauren Martindale, CEC’s director of project development. Aggregating the community’s solar panels made more sense than installing them on individual rooftops. In negotiating details with Holy Cross Energy, developers discovered this aggregated approach was generalizable to other projects, based on existing regulations requiring utilities to credit homeowners for the kilowatt-hours their rooftop units generate.
The group’s first garden went online last fall. Participants can buy a single PV panel for $725, or as many as would add up to 120 percent of their typical electrical load. CEC develops and maintains the installations, signing 20-year agreements with panel purchasers, and additional gardens now are on the drawing board.
Solar gardens also are being planted in Massachusetts. On Cape Cod, a local solar-installation contractor is leading efforts to develop two separate projects in the towns of Falmouth and Brewster. Luke Hinkle, president of My Generation Energy, could be a model for ambitious electrical contractors. His business focuses on individual residential and commercial PV installation, but he saw a market for aggregated solar as the number of interested building owners with less-than-perfect rooftop sites grew. The state’s Green Communities Act of 2008 provided a new option by outlining guidelines for neighborhood net metering.
“It discussed the concept that one jointly owned site could be developed,” said Hinkle, now also co-manager of the Falmouth and Brewster efforts. “That credit could be assigned to other accounts—that ‘virtual’ net metering is key to having the larger community projects make sense.”
The Cape Cod participants are investors in a private limited liability corporation. They own shares, rather than individual panels, and earn a return based on the sale of resulting renewable-energy credits, while other customers of the local utility, NStar, can subscribe to bulk purchases of electricity produced by the facilities once they start operating.
As varied models for community renewable projects are beginning to emerge, some are beginning to see need for standardized guidelines. The Interstate Renewable Energy Council, a national organization focused on renewable--energy regulatory and policy issues, has responded with “Model Program Rules for Community Renewables.”
“Many backers of community renewables have an intuitive understanding of the benefits a successful program can have,” said Joseph Weidman, the author. “But lurking under the surface are [many] pitfalls that can undermine success.”
Additionally, Weidman said rules for the solar projects could be applied in efforts to develop other forms of community-based renewable projects. California, always a leader in new strategies, now is considering expanding its rate structure to enable virtual net metering to all multi tenant buildings.
“In theory, folks using any of the technologies eligible for net metering could use virtual net metering to spread benefits to participants,” Weidman said. “We’ll have to see how that program ultimately shapes up and who chooses to take advantage of the tariff changes.”
ROSS is a freelance writer located in Brewster, Mass. He can be reached at email@example.com.