NREL conducts market analysis, provides technical assistance, and develops tools and resources to accelerate equitable access to community solar.
Community solar is a solar energy deployment model that allows customers to buy or lease part of a larger shared solar photovoltaic (PV) system.
The U.S. Department of Energy (DOE) defines community solar as any solar project or purchasing program, within a geographic area, in which the benefits of a solar project flow to multiple customers such as individuals, businesses, nonprofits, and other groups. In most cases, customers benefit from energy generated by solar panels at an off-site array. Community solar subscribers typically receive a monthly bill credit for electricity generated by their share of the solar PV system, as if the system were located on their premises.
Community solar arrangements allow customers to enjoy advantages of solar energy without having to install their own solar energy systems. Community solar projects provide an alternative to rooftop PV systems for customers who:
In a 2024 study, NREL estimated the technical potential for community solar in the United States, finding that community solar could theoretically grow to serve all residential electricity customers who are unable to adopt behind-the-meter solar, including low- to moderate-income households. Through this analysis, NREL found that 42% of households and 44% of businesses are unable to access behind-the-meter solar, which is lower than previous estimates.
As of December 2023:
Since 2018, NREL has collected and analyzed data on the community solar market in the U.S. through its Sharing the Sun initiative. Sharing the Sun: Community Solar Deployment, Subscription Savings, and Energy Burden Reduction presents U.S. community solar market trends through 2023, with content on energy burden reduction potential. NREL's list of community solar projects, updated through 2023, provides the most recent details on project sizes and locations.
Other clean energy policies interact with community solar; depending on their design, some projects may have to comply with U.S. Security and Exchange Commission regulations.
Net metering is a commonly used mechanism that credits distributed generation owners for the power that their systems contribute to the grid. Community solar participants can be credited through net metering or alternative arrangements such as value of solar tariffs; group billing; or joint ownership. Eligibility depends on utility and state-level requirements.
Virtual net metering, also referred to as "remote" net metering, allows customers to receive bill credits for generation from an off-site solar energy system. Some form of virtual net metering must exist for community solar to work properly so that multiple customers can offset their electricity loads from a system located elsewhere.
Tax credits, like the federal investment tax credit for solar PV systems, may apply differently to community solar participants, depending on the structure of the community solar program. Variables include whether the participant owns the panels or output (in kilowatt-hours) and if a participant claims an individual or commercial tax credit. There is still uncertainty regarding the exact circumstances in which a community solar participant can claim the investment tax credit.
Based on design details, community solar projects can benefit customers, utilities, and third-party entities by providing:
Community solar projects can be owned by utilities or third-party developers and can be located on public buildings, private land, brownfields, and other suitable areas. Program designs vary by type of bill credit (usually kilowatt-hours or dollars), contract length, cost of participation and financing options, eligibility, number of participants allowed, and products offered (e.g., panels or generation).
Common ownership arrangements include:
Typically, program participants who move within the same utility service territory or county can retain their community solar share, or options for selling or donating program subscriptions may be available. Community solar projects and programs can also be designed with set-asides for low-income customers to expand solar PV accessibility.
Browse all NREL publications related to community solar in the NREL Publications Database.
See the National Community Solar Partnership playlist on the NREL Learning channel on YouTube for access to a list of relevant videos.