Most American households cannot install solar on their property because they rent, live in a multi-tenant building, or experience other mitigating circumstances. In light of this issue, many states are turning to community solar (also known as shared solar) as a means of lowering the barrier to accessing renewable energy savings while supporting the growth of the clean energy economy. At least 24 states, plus Puerto Rico and Washington DC, have already enacted legislation that incentivizes shared renewable development. Each of these state’s programs are constantly evolving, helping the nation achieve its renewable energy goals and driving future growth for the industry.
Here, we’ll take a closer look at the legislation that’s driving community solar development in a few key states.
Delaware's journey with community energy facilities (CEFs) started off slowly. Established in 2010, the program showed only limited success. However, in 2021, the state set the ambitious goal of achieving 40% renewable energy by 2035 – this goal reignited its community solar program.
The revamped community solar program opened its doors in April 2022, and the response was overwhelmingly positive. Project submissions flooded in, exceeding 250 megawatts (MWs). This surge, while a testament to public interest, did result in an interconnection queue backlog where projects eagerly awaited their turn to connect to the grid.
Despite the waitlist, the program boasts features that ensure that it caters to a diverse range of participants. Notably, 15% of each project's subscribers must be low-income households.
Delaware's CEF program holds immense potential. The state's dense population and limited utility options make it fertile ground for community solar to flourish. With continued focus on streamlining the interconnection process and fostering collaboration, Delaware's community solar program is poised to illuminate a brighter future for its residents and the environment.
The arrival of the Climate and Equitable Jobs Act (CEJA) brought about ambitious clean energy goals for the state – increasing funding for low-income programs and expanding the annual community solar capacity. The program is thriving, but challenges remain nonetheless.
The initial lottery system for project selection has been replaced with a first-come, first-served approach, creating a long waitlist. Additionally, competition for low-income customers is likely to intensify due to the added tax credit adders offered by the federal Inflation Reduction Act.
Despite the hurdles, Illinois' community solar program offers a beacon of hope. The program prioritizes both traditional and low-income communities, with dedicated funding and incentives for each. Additionally, the state's dual-use initiative for agricultural land promises to unlock new possibilities for project development across the state’s utilities.
In 2015, Maryland embarked on a community solar journey with a 7-year pilot program. While initial progress was slow due to siting restrictions, the state demonstrated its commitment by expanding the program's capacity and easing regulations in 2022. This paved the way for a significant leap forward in May 2023 with the creation of a permanent program.
This permanent program removes the capacity cap, ensuring broader access to community solar. It also prioritizes low-income residents by mandating 40% of each project's capacity be reserved for them. By allowing low-income subscribers to self-attest to their income status and by mandating consolidated billing, the program is much simpler to access from the subscriber’s perspective.
Despite initial limitations in access and a project waitlist due to high demand, Maryland's community solar program is poised for a bright future. With the support of federal tax credits and a strong market potential, this program has the potential to illuminate a more equitable and sustainable energy landscape for the state.
As the community solar market continues to grow and evolve, don't be afraid to lean on community solar experts, like Pivot Energy. We can help you navigate the fluctuating policy dynamics, mitigate churn risk, gain invaluable insights, and ensure total compliance in an ever-changing landscape. For more information, reach out to a member of our team today.
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