If you’re hoping to reap some of the benefits of going solar without physically installing panels on your property, community solar might be the right choice for you. Community solar projects are large, central power plants whose electricity is shared by multiple properties – but who exactly develops these projects and how are they developed? In this article, we’ll explain what you need to know about community solar developers.
- At a minimum, community solar developers are generally responsible for scoping the project, overseeing its construction, and connecting it to the grid – they may or may not actually own the project.
- Community solar developers aren’t always the same companies managing your subscription (but they can be!).
- Some of the key community solar developers to know include BlueWave Solar, Nexamp, Clearway Energy Group, and Borrego.
- Visit the EnergySage Community Solar Marketplace to explore projects near you.
What’s in this article?
Models of community solar
There are many different models of community solar that may vary depending on the area you live in.
In this model of community solar, a utility company actually owns the solar system and then sells or leases the panels themselves to people who subscribe. Each subscriber then can buy a share of this community solar project. They receive a credit on their bill from the amount of electricity generated by their panel.
Special purpose entity model
Instead of using another third-party sponsor to create the solar generating apparatus, Special Purpose Entity (SPE) models of community solar are created by the individuals involved creating an LLC. This LLC handles most business aspects of the site including making lease payments, maintaining the relationship with a utility and operation. Members of the LLC are also subscribers.
In this community solar model, the developer actually owns, maintains and constructs the community solar farm and project. Subscribers to the project do so through a power purchase agreement or a lease. With a PPA, sponsors sell the electricity to a subscriber for a determined rate every month. For a lease, subscribers pay monthly to the sponsor for the electricity. In both cases, subscribers receive a credit to on their monthly bill.
What’s a community solar developer?
A community solar developer can have a variety of responsibilities depending on who owns the project. Generally, developers are tasked with scoping the project, overseeing its construction, and interconnecting it to the grid. Community solar developers may own or lease the land on which the project is developed. Similarly, they may own the project itself, or they could develop it for a utility or another third-party owner. While some developers are only involved with the initial development of the project, others may assume responsibility for the project’s operations and maintenance (O&M) and eventual decommissioning.
Community solar developers also aren’t necessarily synonymous with subscriber organizations – while some developers may also be involved with acquiring subscribers, others will pass this task onto a different company. As a community solar subscriber, you’ll likely only interact with the developer of your project if they also act as the subscriber organization, meaning they’re the ones sending you a bill each month for your share of the project.
What is the process for developing a community solar project?
As previously mentioned, not all community solar developers will be responsible for a project from start to finish; oftentimes, different companies will fill the various roles depending on the project’s owner. However, if you’re curious about the steps required to develop and maintain and community solar project, they include:
- First, a developer either purchases land or partners with a property owner so they can lease the land to develop it for a project.
- The developer conducts a project feasibility analysis and acquires all the necessary permitting and financing for the project.
- The project is designed and engineered.
- Necessary project materials are acquired.
- The developer either constructs the project itself or oversees construction by a third-party company.
- The developer connects the community solar project to the grid so its generated electricity can become a source of energy for the utility.
- A subscriber organization (the developer or otherwise) is responsible for acquiring and maintaining subscribers to the project.
- A company (the developer or otherwise) conducts O&M for the community solar project to ensure that routine and surprise maintenance, performance testing, and inspections are taken care of.
- Eventually, a company (the developer or otherwise) will be responsible for decommissioning the project when it’s reached its end of life.
Who are some of the major community solar developers?
There are a few key companies currently developing community solar projects that you should know about. We’ll explain the various roles each of these companies play in the development process.
BlueWave Solar was founded in 2012 with a mission to “revolutionize energy with simple, powerful solutions.” BlueWave is involved with scoping the project site, engaging the surrounding community, overseeing the construction of the project (they partner with contractors to complete the construction), and interconnecting the project to the grid. In addition to community solar, they also develop storage projects. BlueWave leases land for their projects and generally doesn’t maintain project ownership.
BlueWave develops community solar projects in the Northeast with a primary focus on dual-use projects, such as agrivoltaics – in fact, about half of all projects developed by BlueWave in Massachusetts are dual-use. In 2021, Perch Energy spun out of BlueWave to essentially serve as a subscriber organization for community solar projects. As of the end of 2021, BlueWave has developed and built over 150 megawatts (MW) of solar.
Founded in 2007 by two U.S. Army veterans, Nexamp now builds and operates community solar projects (as well as energy storage projects) across the country. Nexamp prides itself on “building the future of energy so it is clean, simple and accessible.”
Unlike some other community solar developers, Nexamp is a vertically integrated company – meaning they own and operate all of their projects from development to decommissioning. All of their projects are engineered in-house and their construction team oversees development through each phase. After the project is commissioned, Nexamp conducts all O&M and the eventual decommissioning of the project at no cost to the property owner. In addition, Nexamp serves as the subscriber organization for their projects.
Clearway Energy Group
Clearway Energy Group is one of the largest developers and operators of clean energy in the U.S. So far, they operate over five gigawatts (GW) of wind, solar, and energy storage, including assets that are owned by their affiliate company, Clearway Energy, Inc. Specifically, they operate about 1.3 GW of solar, 320 MW of which come from community solar and distributed solar projects.
Clearway Energy Group operates with a mission “to do good by [their] customers, [their] communities, [their] environment.” They manage their projects from conception through development. They also have a Commercial Operations team who controls the operations, maintenance, and asset management of their projects. A separate but affiliated company, Clearway Community Solar, serves as a subscriber organization for their projects.
Borrego was originally founded in 1980 (over 40 years ago!) and has a mission of “accelerating the adoption of renewable energy” – with an overall goal of becoming the leading U.S. provider of solar and energy storage by 2024. They develop, optimize, deliver, and maintain large-scale solar and storage projects, with over one GW of total solar capacity (beyond just community solar) and almost 200 megawatt-hours (MWh) of energy storage developed to date.
Borrego operates across the U.S., developing large commercial, utility, and community solar projects. They don’t typically own their projects and don’t serve as a subscriber organization. However, they do offer O&M for some of their projects.
Why sign up for community solar?
Community solar provides many of the benefits of rooftop solar, but there’s no upfront cost and less commitment required. By subscribing to a local community solar farm, you’ll still reduce your electric bill and climate impact without installing a single solar panel!
Frequently asked questions about community solar
For most people, community solar is a great deal! Depending on your subscription structure, bill credit discount, energy consumption, and the amount of energy generated by your project, you’ll likely save anywhere from 5-15 percent annually on your electricity costs.
The way community solar developers make money can vary substantially depending on their overall role in the project. For example, if it’s a developer owned project, the developer will make money directly from the solar subscribers. However, if it’s a utility or third party owned project, the developer will likely be paid directly by the project’s owner.
According to the Solar Energy Industries Association (SEIA), as of the end of 2021, there were 4.6 GW of community solar installed in the U.S.
Sign up for community solar through EnergySage
EnergySage’s Community Solar Marketplace is designed to allow you to explore, compare, and sign up for projects near you – some were even developed by the companies we listed in this article! Don’t see any projects available in your area yet? The community solar industry is constantly growing, and more and more states are introducing policies to support development – so be sure to check back soon!