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Key Points
- Community solar helps customers save on electricity bills while supporting local solar farms.
- The number of states and utilities in the U.S. supporting community solar programs is increasing.
- Joining, transferring, or canceling a community solar subscription is easy and flexible.
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The cost of residential solar panels has decreased substantially in recent years. Still, many consumers cannot buy solar panels because of the upfront cost, their location, or because they rent their homes.
Community solar — also called shared solar — offers an affordable alternative for using solar energy without buying a solar panel system. Based on the latest Solar Energy Industries Association (SEIA) data, 41 states and Washington D.C. have at least one community solar project online. Additionally, 19 states and D.C. have implemented policies supporting community solar.
Learn more about community solar options in your area, how to sign up, and the pros and cons of participating in a program.
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What is community solar?
Community solar allows residential homes and businesses to support the development and use of solar power generated from solar farms. You can enjoy the benefits of lower energy bills without paying the upfront costs ofinstalling panels on your home.
“Community solar is about providing solar for all,” explains Aaron Halimi, the founder and president of Renewable Properties, a community solar project developer “It is a mechanism that allows people to subscribe to a solar project and then receive economic and environmental benefits to offset their electricity bill.”
When you sign up for community solar, you support the development of a nearby solar farm and local green energy initiatives. However, participating in a community solar program does not mean you’re actively consuming solar energy. Instead, the energy generated by the solar panels is sent to the electricity grid.
“As a subscriber, you are enabling more renewable energy to get onto the grid, and you receive the economic benefits while making a difference in climate change,” Halimi says.
How does community solar work?
Community solar programs vary by provider but typically involve the following steps.
- Determine eligibility. Check if your utility or provider works with community solar programs. If community solar is available in your area, enter your basic information to find out if you qualify for the program.
- Subscribe. Review the contract to understand the terms and ask any questions. Once you’re ready, sign up.
- Utility connection. Your community solar provider connects with the utility company to ensure solar credits apply to your bill.
- Activation. You will begin receiving your electricity bill through the community solar program. Once connected to a solar farm, the credits will be applied directly to your bill.
After signing up to participate in a community solar program, you may experience a long waiting period before reaping the savings benefits due to lengthy project development timelines. According to Halimi, projects take 12 to 24 months for development and then a year for construction. Though the timeline is lengthy, 94% of solar projects are completed on time. This process is necessary to ensure long-term success and savings, so patience is key as a subscriber.
Community Solar Guide by Save On Energy
Steps to join community solar with SaveOnEnergy.com®
Our community solar partner, Arcadia, is the country’s largest manager of residential community solar programs. Arcadia does not require a credit check or long-term contract to join, extending accessibility to everyone. Participants typically save 5%–10% on their energy bills and can pay for energy through Acadia’s custom billing software instead of paying two separate bills.
Signing up for community solar with Arcadia is quick and easy.
- Step 1: Enter your ZIP code and utility provider on Arcadia’s website to check for available community solar programs in your area.
- Step 2: Create an Arcadia account by entering your basic contact information, such as your name and email address. You may have to submit your credit score or income range, depending on the company. The information is collected to ensure payment or provide access to specific income levels.
- Step 3: Input your utility login details and credit card information, which is used for monthly auto-pay billing. Your Arcadia subscription will link to your utility to help you track how much electricity you are using.
- Step 4: Sign up and wait for solar farm connection. The time it takes to connect varies by location. In areas with multiple active solar farms, connection takes about two or three months, while in areas with developing solar farms, connection may take six months or longer.
- Step 5: Arcadia will send you information about your connected solar farm and automatically apply energy-saving credits to your electricity bill. You can manage monthly bills through your Arcadia account.
Community solar pros and cons
There are several benefits to community solar, such as providing an opportunity to benefit from solar energy without installing panels on your own property. However, there are also some drawbacks to consider. Here is a table summarizing the pros and cons of community solar.
| Pros | Cons |
|---|---|
| Lower energy bills through solar energy bill credits | Not available in every state or city |
| Avoid the upfront costs of solar panels, including roof repair | Lower long-term financial savings compared to purchasing a solar system |
| Great for renters or consumers who might move homes | Ineligible for most solar incentives and rebates |
| No maintenance requirements | May experience a long waiting period without savings |
| Flexible programs with short-term contracts, simpler cancellation, and transfer options than other contract payment methods, like a power purchase agreement or a solar lease | Solar farms require construction on large areas of land |
| Support local clean energy initiatives | No increase in property value |
Community solar versus rooftop solar
Community solar and rooftop solar both allow consumers to benefit from solar energy but have many differences. The following table compares and contrasts community solar, rooftop panels, and traditional electricity.
| Community solar | Rooftop solar | Traditional energy plan | |
|---|---|---|---|
| Upfront cost | Very little to no upfront cost requirements | High upfront costs depending on payment method; low-interest loans and financing options are available | Average monthly electric bill, potential rate increases |
| Ownership | You will not own the solar system | You will own the solar system | You do not own any generating power |
| Incentive eligibility | Not eligible for most solar incentives, only solar credits on your monthly bill | Eligible for most solar incentives, such as the federal solar tax credit and local incentives | Not eligible for solar incentives |
| Increased property value | No impact on property value | Increases property value by an average of $15,000 | No impact on property value |
| Money savings | Monthly bill savings once connected to a solar farm | Save thousands on energy bills following your solar system’s payback period | No energy bill savings as you pay for traditional power |
| Renter-friendliness | Good option for renters and property owners | Only available to property owners | Many energy plans are available to renters |
| Maintenance requirements | No maintenance requirements | The system owner is responsible for required maintenance | No maintenance requirements |
Where is community solar thriving?
Community solar is growing fast across the nation. There are 5.8 gigawatts of community solar capacity in the U.S., and experts predict more than six gigawatts of power will come online in the next five years. Some states are experiencing faster community solar growth than others. Here are the top 10 states where community solar is thriving the most based on National Renewable Energy Laboratory (NREL) data.
| State | Total capacity in megawatts (MW) | Percent of U.S. community solar capacity |
|---|---|---|
| Florida | 1,635 MW | 31.3% |
| Minnesota | 834 MW | 16% |
| New York | 731 MW | 14% |
| Massachusetts | 673 MW | 12.9% |
| Texas | 323 MW | 6.2% |
| Arkansas | 183 MW | 3.5% |
| Georgia | 135 MW | 2.6% |
| Colorado | 119 MW | 2.3% |
| Illinois | 118 MW | 2.3% |
| Maryland | 58 MW | 1.1% |
The remaining states not listed make up a combined 406 MW of capacity, which is 7.8% of the total community solar capacity in the country. Total U.S. generating capacity from community solar rose about 43% from 2020 to 2021 and has continued to grow since.
The opportunities to participate in a community solar project are increasing. “If you’re in a market where community solar is an option for you, and you’re not in a position to put solar on your rooftop, you should consider participating,” Halimi says. “Community solar enables more renewable energy coming onto the grid, and you can generate savings on your electricity bill while doing it.” Find community solar projects in your area by entering your ZIP code on Arcadia’s website.
Want to learn more about solar energy options? Visit SaveOnEnergy’s solar guides below:
Community solar FAQs
Community solar can help lower your electricity bills because solar energy is less expensive than traditional electricity. The savings are given to you as credits on your utility bill. Also, participating in a community solar program supports clean energy goals in your area and is a great opportunity for homeowners who do not want to purchase a solar system outright.
Community solar will not replace your need for energy from the electricity grid. If your goal is to use solar energy to cover your home’s energy needs, consider installing rooftop solar panels.
Yes. Anyone who pays a utility bill can participate. Community solar is a great option for those who cannot or do not want to install solar panels on their own property, including renters. Get started by entering your ZIP code on Arcadia’s website to find out if Arcadia works with your utility.
If you move to a place that is part of the community solar service area, you can transfer service to your new home. If you move outside the service area, you can pass your credits to someone else or end your subscription without penalty.
No. You cannot take advantage of most solar tax credits and rebates with community solar. Only owners of solar systems are eligible to receive such benefits, like the federal Residential Clean Energy Credit, a 30% credit on the total solar panel system purchase.
Canceling your shared solar subscription is usually very simple. For Arcadia participants, if you want to cancel your subscription, you can do so over email or through your Arcadia dashboard. There are no cancellation fees. You can find details on the subscription cancellation process in your agreement.
Community solar provides an excellent opportunity to save on energy bills, but the sign-up process can be confusing. Understanding why you are providing certain information is important. For example, with Arcadia, you will provide your credit card information during the sign-up process to pay your monthly electricity bill on an auto-pay schedule.
Community solar subscribers are supporting the development of local solar farms and receiving monetary credits for solar energy generation. Participating in community solar does not mean you are using solar energy. Traditional 100% renewable energy plans provide homeowners with electricity generated from renewable sources and allow users to claim renewable energy credits (RECs). Renewable energy plans often do not come from local sources.