Community Solar: Definition, Growth, and Benefits

Energy - 03rd Dec 2021
community solar

The Biden administration set a goal of powering five million American homes using community solar projects by 2025. This goal requires a 700% growth of the country’s current capacity.

This shows the huge interest the United States government has in community solar projects.

It’s no wonder why countries across the globe, especially the United States, are pursuing community solar projects.

From saving resources to conserving the environment, community solar projects have proven how useful they can be.

This article outlines the growing interest of governments and other organizations in community solar projects. The benefits of community solar farms will also be discussed.

What Is Community Solar?

According to the US Department of Energy, community solar describes a solar project or program through which solar energy flows to several customers.

These customers include residents, small- to medium-sized businesses, corporations, non-profits organizations, and other institutions. In most cases, consumers who participate in the community solar projects benefit from the energy generated by solar panels at a farm.

Consumers can either buy or lease a portion of the solar panels in a community solar farm. They usually receive electric bill credits for the power generated by their share of the community solar project.

The solar panels in a community solar farm work exactly just like the ones installed on homes. The only difference is that community solar farm panels are bigger and the energy generated is distributed among stakeholders.

Unlike residential and commercial solar panels, community solar panels are generally installed on leased land.

Consumers therefore have many reasons for joining community solar programs. Their motives vary just like community solar models. Each comes with a unique set of costs and rewards.

Models for a Community Solar Project

  • Utility-Sponsored Model

    Describes the model owned by a utility. A community solar project following this model is open to voluntary ratepayer participation.

  • Special Purpose Entity (SPE) Model

    SPE describes the model in which individual investors participate in an enterprise to create and develop a community solar project.

  • Non-Profit “Buy a Brick” Model

    This model involves donors who contribute to a community solar program owned by a non-profit organization.

The Growing Community Solar Market

The current US administration set a goal of powering five million American homes through community solar projects by 2025. This goal requires a 700% growth, pushing the Biden administration to fast-track its community solar efforts.

According to the National Renewable Energy Laboratory (NREL), approximately 3,253 MW-AC community solar capacity was installed in the country by the end of 2020. This capacity can power 600,000 homes.

The collective installed capacity of community solar programs across the US has been swiftly growing since 2010, doubling on average year after year.

Experts from NREL and the University of Minnesota revealed a recent report showing the monumental growth of community solar over the past ten years. The report also revealed that the US now has 1,600 community solar projects with a total capacity of over 3.2 gigawatts.

Furthermore, the report features the financial value community solar brings to stakeholders. Community solar can lead to enormous bill savings of up to 25%.

The most recent status of the community solar market is as follows:

  • Thirty nine states plus Washington, D.C. have community solar projects.
  • Four states hold approximately 74% of the total community solar market namely Minnesota, Florida, Massachusetts, and New York.
  • Community solar projects in the US have a total installed capacity of 3,005 megawatts alternating current.
  • During the last half of 2020 and the first half of 2021, 11 states generated over 5% of their electricity from solar energy. California led the way at 24.3%.

Benefits of Community Solar Programs

The following are the top benefits of community solar projects:

1. Saving money

Community solar can decrease your electricity bill. Each billing cycle, the assigned value dependent on the electricity generated by your community solar will be deducted from your bill.

You will be only charged for the electricity you consume above the said value. If you consume less than the said value, you don’t have to pay your electricity bill.

2. Creating green jobs

The renewable energy market, which includes community solar projects, generates jobs 12 times faster than the rest of the economy.

In the US alone, hundreds of thousands of clean energy jobs have been created by the said market, outnumbering jobs created by fossil fuels by three to one.

Community solar projects can bring these well-paying clean energy jobs to several communities.

3. Expanding renewable energy access

Several cities bring clean energy to low-income communities and renters, thanks to innovative community solar projects.

By allowing individuals and small- to medium-sized enterprises to purchase a part of a community solar farm, an increasing number of people reap the benefits of solar energy without having to install costly solar panels themselves.

Community solar projects also allow those without suitable rooftops for generation to get access to solar energy.

Combining the said features, community solar projects make clean energy accessible to all, one step at a time.

4.Giving renters an excellent choice

In relation to the aforementioned point, a community solar program gives renters the chance to contribute to conserving the environment.

Since mobility in the United States is common, community solar programs give renters the chance to choose clean energy. Various community solar programs also allow renters to cancel their subscriptions anytime, taking away the hassle of doing tedious paperwork.

5. Increasing local resilience

Community solar projects increase local resilience. Pairing collar energy with microgrids or storage facilities decreases the dependence of communities on non-renewable electric grids in times of natural disaster.

Since sunlight is a renewable energy resource, communities don’t have to solely rely on fossil fuels for energy.

Furthermore, solar community projects generate tax credits, which can be used for the development of a community or town. Communities can even sponsor more solar projects if they generate enough tax credits.


The community solar market is evidently booming. It seems like its steady and rapid growth is not stopping anytime soon, so many people want a piece of the pie.

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