Resources > Starting a community solar project in your community

Starting a community solar project in your community

• Factsheet

May 20, 2024

When individuals work together they can create or support projects that keep more of the benefits within the community. Solar project development and financing can be complex but every shared solar project has some basic components and players. 

Prefer to watch a video? Check out episode 3 of our 3-part community solar series for more on project development.

Project components

• People: Who’s going to use the energy from the shared array?
• Location: Where will the array be located?
• Financing: Who’s going to pay for the construction and upkeep?
• Construction: Who will design and build the solar array?
• Operations & Maintenance: Who will maintain the project and operate it for 25 years?

The parties involved

1. Subscribers: The people who will use the energy could be individuals, businesses, municipalities, nonprofits, and anyone else with an electric meter account in the same utility territory as the array. Sometimes subscribers are also called “off-takers”.
2. Developer(s): The organization(s) that secure a location, find customers, bring together the financing, and build (or sub-contract) the array.
3. Subscriber organization: The official entity that interacts with subscribers, and interacts with the utility over the life of the system. This may be the initial developer, a community entity, or another organization that takes over the array after it is built. This entity may also operate and maintain the array in some cases.
4. Landholder: The owner of the property where the array is located. They will have a legal arrangement with the owner of the array for the use of the land for 25+ years.
5. Utility company: Utilities are responsible for allocating space in the program in their territory, distributing the electricity from the array through their grid, and applying the appropriate bill credits to each subscriber’s utility bill.
6. Public Service Commission (PSC): The PSC monitors the program to ensure it follows regulations. It gathers data about the program and when required, reports back to the legislature.

Project Models

So what does it look like when a community works together? Here are some possibilities:

Third-party-driven, third-party financed: The community brings people to a subscriber organization with a project looking for customers. The community negotiates as a group for a discounted rate and/or special contract terms.

Community-driven, third-party financed: The community brings people (and maybe a location) to a developer and negotiates to create a project for the community’s benefit. The developer and/or the developer’s financing partners build, own, and operate the array. The community has some leverage because it finds customers (and possibly a location). This model could allow participants to manage a reduction in electricity costs, special contract provisions, and local labor sourcing. It could also help them include low-and-moderate income customers.

Community-driven, community-owned: The community brings people, and maybe a location, together while also financing the project. An existing legal entity or new special purpose legal entity owns the array. Community members (individuals and/or organizations) finance the project. The community maintains significant or total control over all aspects of the project. The legal entity that owns the array is responsible for operating it for its lifetime, either directly or through subcontracted service providers.

Resources

• Explore the Resources section of our community solar page.
• Want to learn how to be a community solar developer? Check out the University of New Hampshire’s Community Power Accelerator Learning Lab.
• Looking for a community? Join the U.S. Department of Energy’s National Community Solar Partnership.

Take action

Thinking about starting a project in your community and looking for some guidance? Contact our Help Desk.