Utilities Fuel Growth of Community Solar

September 25, 2014 By Karen Henry

sepa-logo-energy-manageUtilities across the United States are taking a leading role in the spread of community solar projects, according to a new study from the Solar Electric Power Association (SEPA). The study, “Expanding Solar Access Through Utility-led Community Solar,” found that the number of community solar programs in the United States has jumped 64 percent in the past 18 months, 87 percent of which were initiated by utilities.

The community solar projects tracked in the SEPA study are all programs that allow utility customers to buy either capacity or a proportionate share of the electricity from a nearby solar installation.

SEPA found that state mandates have been an important driver in the initiation and spread of community solar programs to date. Of the 57 utility-led community solar programs SEPA now tracks, 31 are located in states with community solar legislation. Colorado, one of eight states with community solar laws, leads the nation with 11 community solar programs on line and two in the planning stages.

Electric co-ops account for 44 percent of all utility-led community solar programs, followed by public power and investor-owned utilities with 30 percent and 26 percent, respectively.

The larger number of co-op programs is partly due to size of the utilities and the projects they develop. Because they are often small rural utilities outside state regulatory control, co-ops are able to respond more quickly to customer interest and demand. Their projects are also smaller, averaging 300 kW, while community solar programs developed by public and private utilities average more than 5 MW.

Almost three-quarters of all community solar projects are offered by capacity, and having flexible financing options for these customers, such as access to low-interest loans or on-bill payment plans, has been an important driver for program success.

Demand for community solar continues to grow. Almost half, 47 percent, of the SEPA survey participants said they are planning program expansions.

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