Installed megawatts (MW) of PV from utility community solar projects StateMW InstalledHostsCompensation Minnesota120Investor owned utilities and co-opsCredited at retail rate California4.9Investor owned utilitiesCredited at wholesale rate Colorado30Utilities, special purpose entities, non-profitsCredited at retail rate (minus transfer charge) Massachusetts70Utilities, special purpose entitites, non-profitsCredited at retail or commercial rate (plus added incentives) Note: the above data was sourced from a 2017 community solar report by strategy&
Minnesota Community Solar Minnesota is the #1 state for community solar in the U.S. The development of shared solar in the North Star State can be explained in three numbers: 20, 430 and 1,003. The first number (20) refers to the megawatts (MW) of community solar that Xcel Energy, Minnesota’s largest utility, planned to install between 2013 and 2015. 430 is the total MW amount of community solar Xcel Energy actually installed in that time as a result of local interest – a 20x increase from the original plan. Finally, 1,003 refers to the current number of proposals awaiting approval from Xcel Energy in Minnesota. With this incredible level of support, it’s no surprise Minnesota is leading the way in roofless solar. One major reason for the state’s success: a public utilities commission (PUC) that emphasizes renewable energy. The MN PUC has worked closely with Xcel Energy to create an accessible, well-incentivized community solar system for homeowners and renters across the state. The PUC also allow utility customers to subscribe to solar gardens directly through Xcel Energy. For interested MN residents, here are the subscription rules and details outlined by Minnesota’s PUC:
To subscribe to a community solar garden, you must live in the same or adjacent county to where the array is located
There must be five or more subscribers for any community solar array to qualify
A single homeowner/renter cannot subscribe to more than 40 percent of a solar garden.
Colorado Community Solar
Minnesota is the U.S. leader in terms of installed solar capacity through shared solar programs, but Colorado leads the nation in total number of active community solar projects. Colorado’s 28 community solar gardens wins the Centennial State the second spot in this “Top States for Community Solar” ranking.
Currently, Colorado has 16 megawatts (MW) of installed community solar capacity and another 31 MW planned. This is partially due to the GRID Alternatives Colorado program, which is focused on building large solar arrays that exclusively serve low-income communities.
Xcel Energy also operates in Colorado, and is a driving force behind Colorado’s community solar success. However, Colorado has a more complex utility system than Minnesota. A vast number of investor-owned, cooperative and municipal utilities operate in the state, each with different policies and programs for community solar. Colorado is also home to one of the largest community solar developers in the nation: SunShare. The developer works closely with Colorado’s various utilities to allow homeowners to lease or purchase solar garden shares. SunShare offers coverage for most of the state of Colorado (and is active in Minnesota as well).
California Community Solar
California is the undisputed leader in installed solar in the U.S., so you might be surprised to learn that it’s far from the top spot when it comes to community solar. The Golden State had something of a late start in the shared solar movement. However, bold commitments made by the state & local governments and investor-owned utilities San Diego Gas & Electric (SDG&E), Southern California Edison and Pacific Gas and Electric (PG&E) have set high expectations for CA community solar in the years to come. The state has committed to a bullish 600 MW of installed solar from shared roofless projects by 2018 – a goal that could potentially propel California ahead of Minnesota to reach #1 in the U.S. for community solar.
Minnesota and Colorado lean heavily on utility support for community solar, and the Massachusetts shared solar industry is largely the result of third-party development. California can be considered a hybrid of the two models. Third-party project developers have a significant presence across the state, but they typically operate through the state’s major utilities because they promote shared solar and offer integrated programs.
Community Solar is also popular in Massachusetts
Unlike Minnesota and Colorado, community solar in Massachusetts is primarily hosted through third-party providers, not utilities. One driving force of shared solar in the Bay State is NRG – an energy retailer that has a special program for community solar. Clean Energy Collective and Nexamp are two other third-party operatives with strong market share in the community solar space.
Each of the top four community solar states offer virtual net metering, but Massachusetts has an additional incentive for shared solar driven by the SREC II Carve-Out program. This specific incentive focuses on equalizing incentives between rooftop and community solar by allowing homeowners to sell credits from electricity production for extra cash. Other than in the state of Massachusetts, SRECs are not typically offered in community solar contracts.
Why MA, MN, CA and CO are Community Solar’s U.S. Leaders Ultimately there are three factors that indicate success for community solar in a specific state:
An involved utility with a strong renewable portfolio standard and/or commitment to solar (like Xcel Energy and SDG&E)
A state that has high electricity rates and good sunlight exposure that may also have issues with ideal solar roof types (such as Massachusetts)
States that have a high number of utility scale projects and solar farms that can attract the attention of prospective third-party providers (California, Massachusetts) Ultimately, shared solar is an excellent alternative solution for those who don’t qualify for (or don’t want to install) rooftop solar panels. The four states outlined above are the dominant leaders to date, but others (such as New York and Vermont) are not far behind. As the benefits of community solar start to reach the ears of more mainstream audiences, expect more utilities across the U.S. to invest in community solar to help them reach their renewable energy goals. You can use EnergySage’s Community Solar Marketplace™ to easily find community solar providers and projects in your state. If you’re considering rooftop solar, too, take a look at our Solar Calculator to get an instant estimate of your potential solar savings.
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