When it comes to decarbonizing our homes, the best one-shot deal around is probably lining your roof with solar panels. But creating a sun-harnessing home isn’t a realistic option for everyone, particularly for people who rent, live in apartments, or are stuck dealing with strict HOAs.
For those folks, community solar projects can provide a taste of decarbonization. Shared solar arrays allow businesses, nonprofits, residences, and more to jointly own or subscribe to a patch of suncatchers in their area. Even a small community solar project can generate enough emissions-free energy to power more than 500 homes for a year, says Spencer Fields, director of insights at EnergySage, a marketplace specializing in comparing solar energy products. That’s like taking more than 900 gasoline-powered cars off the road.
Community solar can also reduce electricity bills for customers, which are often already disproportionately higher for disadvantaged communities. Connecting to community solar can deliver savings anywhere from 5% to 20% a month, Fields estimates.
Electricity users can buy a part of a solar project or subscribe to benefit from the clean energy it generates. When you buy a subscription, you’re buying “credits” for generating renewable energy, and those credits get applied to your utility bill. The savings come in because what you get back is worth more than what you paid. In the simplest math, a 10% discount (which Fields says is about average) would be buying $100 worth of credits for only $90.
Unlike with rooftop solar—in which you’re capturing and using energy directly from atop your home—you’re not buying the specific electrons from a specific patch of solar panels in a community solar project. Rather, you’re helping finance the generation of electricity in that project, which then gets distributed through the local power grid.
Opting to go solar in this way can send a powerful signal to utility companies. “You are directly contributing to the growth of solar and renewable energy because you are voting with your dollars,” says Fields.
And there is an upswing of availability afoot. According to the Department of Energy, the U.S. had more than 3,400 such projects across the country as of June 2024. Those arrays can produce up to 7.87 gigawatts (GW) of juice, enough to power about 1 million American homes per year. According to the National Renewable Energy Laboratory (NREL), that capacity is set to double in the next few years, as an additional 300 megawatts of capacity comes online every few months.
Here’s how to know if community solar makes sense for you:
Step 1: Figure out if rooftop solar (or something else) is a better option
Rooftop solar delivers the biggest potential savings in terms of greenhouse gas emissions, and it’s likely a better option for homeowners who are: (1) in it for the long haul and (2) can afford the upfront cost. Going solar can mean major savings over time: Rooftop arrays can meet a building’s entire energy needs, dropping electricity bills down to $0 in some cases. The real finance math, though, comes down to longevity. It can take around eight years to recoup the upfront costs, which run around $30,000, according to EnergySage’s estimates. That means property owners eyeing solar should consider the condition of their roof and how long they plan to be in their home.
People in a few parts of the country also have a third option: choosing an electric utility that delivers energy from clean sources like wind and solar. Currently, 18 states and Washington, D.C., provide what’s known as “retail electricity choice,” which allows eligible consumers to pick where their supply comes from. Another means to a similar end is called “community choice aggregation,” which is a scheme where municipalities get energy on behalf of residents—though these setups are only available in 10 states right now.
Step 2: Find community solar opportunities near you
To find out if community solar is available in your area, the easiest place to start is your current utility provider. Check out their website or give them a call, says Sudha Kannan, a researcher and policy analyst at NREL. “It’s hard because every utility has different contracts,” she explains, noting that payment schemes, costs, and even how contracts are set up can vary from project to project.
It’s also pretty easy to browse online. EnergySage hosts a marketplace for people to search for and compare community options by ZIP code. NREL also maintains a list of all state-level policies and programs supporting community solar, if you’re among those who don’t mind perusing spreadsheets.
As you shop around, it’s important to remember that not everything billed as “community solar” might fit the same definition. Some might count utility-scale installations as community solar, which is why it’s important to look at who is actually developing, operating, and benefiting from a project, Fields says. EnergySage’s internal analysis estimates there are legit community projects in about 16 states (soon to be 20) with the most in Massachusetts, Minnesota, and New York.
Step 3: Read up
However they’re technically defined, community solar projects can come along with agreements filled with pages of detail. These documents outline important binding information like upfront costs, cancellation fees, and how energy bill credits work.
If there are community solar options available in your area, Fields and Kannan say to ask about all associated costs up front. This means getting answers about any fees (cancellation or otherwise), how billing will work (some projects send a separate bill while others land on the normal utility bill), and availability of resources (will the subscription generate credits immediately or is the project still under construction). Solar United Neighbors, a nonprofit focused on energy equity, has a great checklist of what to know and ask. You should also push for clarity about how much savings you can expect on your electricity bills. “The biggest thing to look at is what sort of discount you’ll see on your monthly or annual electricity bills,” says EnergySage’s Fields.
The other big difference is to understand what you’re paying for: Are you buying a piece of a project or subscribing to tap its energy? Fields says subscription-based models are the easiest to back out of if moving is a possibility in the next few years. Ownership-based models may include more complicated financing mechanisms, since the costs associated with the project may be shared in addition to the benefits, and could come with different funding options—and even tax implications.