By Lisa Cohn
My roof isn’t solar-friendly, I live among the trees close to a large urban park.
But I still want to participate in the solar revolution!
A few years ago, I signed up for Portland General Electric’s (PGE) green power program, which the utility claims is the largest green energy program in the country. For a premium of about 1 cent/kWh, I pay for renewable energy that replaces dirty power on PGE’s grid. I signed up to displace 100% of my electricity needs with green energy through PGE.
But lately, I’ve been getting emails and phone calls from companies that offer community solar that’s 5% to 20% lower in cost than utility power–with the 20% discount going to low- and moderate-income communities. Under these programs, a number of people share solar that’s generated by a solar plant in their state. Of course, the solar doesn’t flow directly to you. Like utility green power programs, you’re displacing dirty power on the grid.
Bob, a community solar naysayer
Some people are skeptical about these solar-for-all options. Take my friend Bob, for example, who says he would never sign up for utility green power or community solar.
“If you want to invest in solar energy, why not invest in a solar company and not give your money to a third party?” he asks. “How do you know where your money is going? By investing in an actual company, now you’re becoming a player. You’re playing a part in the energy transition,” he says.
But not everyone can afford to make possibly risky investments in solar companies. Bob would say I’m naive, but I want to believe that, thanks to state and federal programs, someday soon anyone who wants to buy solar can participate in community solar programs. With these programs, people will cut carbon emissions while saving money.
Sign up for community solar, and your utility gives you the discount
Here’s how it works: With these programs, you purchase power from a solar plant that is managed by a third party, and you remain with your utility, which does the accounting for you and gives you the promised discount.
Of course, Bob doesn’t like this, either. He doesn’t trust the utility to do the accounting.
In response to Bob’s objections, I did a little research. Here’s what I learned.
Most programs—run by states—come with a guaranteed discount, which is generally 5% to 10% off your utility bill.
Twenty percent price discount for low- and moderate-income families
For low- and moderate-income families, that discount is 20%, said Nate Owen, CEO and founder, Ampion, which operates these solar projects: “The federal program requires a 20% discount, which is huge,” he said.
He’s referring to the clean energy provisions of the federal Inflation Reduction Act, which includes the Low-Income Communities Bonus Program. The program has a category for low-income financial benefit projects, including community solar plants. Developers creating these projects receive a 20% investment tax credit (ITC) in addition to the 30% baseline ITC and, as Owen says, plant owners must offer a 20% discount to low-income people who buy from these solar projects.
Here in Oregon, for example, low-income residents get a 20% discount compared to utility rates.
One of the most important features of community solar: It’s for the masses, says Leland Gohl, clean energy director of marketing for PowerMarket, a community solar provider.
“You can live paycheck to paycheck and still participate. There are no up-front costs and guaranteed savings,” Gohl says. His company works with developers to get these solar projects up and running, and also works with individuals and businesses that purchase from projects.
Forty-one states, plus D.C., have at least one community solar project operating
At least 19 states and D.C. have community solar policy and programs in place, says the Solar Energy Industries Association . And 41 states, plus D.C., have at least one project online. About 5.8 gigawatts had been installed cumulatively through the first half of 2023.
“The product is so valuable to the industry, consumers and investors,” said Owen of Ampion. “I believe it’s unstoppable. As long as legislators in each state pass this legislation, their state benefits tremendously.”
Not only do homeowners and businesses benefit from community solar; so do renters. If renters have their own utility account, they can sign up for these programs.
In spite of Bob’s objections, I’m a believer in community solar. I don’t want to take the risk of investing directly in a solar company. I don’t have a roof that is suitable for solar panels. Utility green power comes with a premium. That leaves the community solar option–and I think it’s a good one.
How states create community solar programs
The Oregon Community Solar Program was first created under 2016 Senate Bill 1547, and the Oregon Public Utility Commission was handed authority to implement it.
In Oregon, the projects must have a subscription minimum of five people and not exceed 3 megawatts of capacity. Projects must be located in the Oregon service territory of an electric utility, with at least 10% of the project generating capacity allocated exclusively to low-income residential customers.
A single participant’s ownership or subscription can’t exceed 40% of the project. The solar plants’ start-up costs are paid through electric company rates, while ongoing costs come from subscribers.
The first time I looked into Oregon’s community solar program–a few years ago–I was very confused. I had too many options. I could choose a plant close to rainy Portland, or I could choose one in sunny Medford or central Oregon.
How do you choose a solar project?
I thought that I would reap the most environmental benefits by opting for the solar plant closest to me. But the facility closest to me wouldn’t produce as much solar as the options in central Oregon.
So, even though I knew that community solar is less expensive than utility power, I procrastinated.
Gohl says it doesn’t matter which solar plant you choose. If I opt for a facility near Portland that produces less solar than one in central Oregon, I simply will get more power from the plant, which will cover my energy needs.
But as valuable as these solar programs seem, there’s a hangup getting projects up and running.
Solar for the masses—with a catch
It’s hard getting the solar plants connected to the grid. That’s because utilities have long interconnection backlogs. And those backlogs could get worse, as developers take advantage of the Inflation Reduction Act’s tax credits and build more solar plants that need to gain interconnection.
As it turns out, those backlogs are now preventing me from taking advantage of these solar-for-the-masses programs. A few years ago, I had options. Now, I have to wait.
When I recently tried to sign up , my only choice was to wait for a plant to gain interconnection. I’m now signed up to work with Arcadia, which has no plants available right now–unless you qualify as low-to-moderate income. (I think that’s good news. The solar goes first to people who benefit most from cutting their energy bills).
At a recent electrification event, an Arcadia representative told me that long interconnection wait times are indeed what’s holding up community solar in Oregon.
Meanwhile, I regret procrastinating, and I wait. I pay a premium for PGE green power, when I could be getting a 10% discount on my utility bills.
As I wait, Bob researches ways to invest in a solar power company.
What will you do?
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