Updated December 2022 – We updated the below blog questions to reflect feedback and questions we have received from our community solar members.
Despite the astonishing increase in the number of community solar installations over the past few years in New York and across the United States, the general awareness of community solar remains very low. With this level of growth and general lack of awareness, you may be wondering what is community solar exactly and how do these programs work?
We’ve included some answers to your most burning community solar questions, including the advantages, energy valuation, subscription process, customer management, and allocation rules.
1. What are the benefits of Community Solar to businesses and individuals?
In short, community solar offers the best features of rooftop or onsite solar installations but without many of their drawbacks. The primary benefit over onsite installation comes from the cost-benefit relationship. Community solar requires no installation of solar panels on your property, and, as a result, there is no capital outlay to get started. The benefit comes from the associated savings, which starts as soon as the project is operational. Most community solar programs offer a discount up to 10% of your monthly energy costs.
Most community solar programs offer a discount up to 10% of your monthly energy costs.
For large consumers of energy, there are additional options beyond community solar that may be more appropriate for their energy needs, such as a Power Purchase Agreement (PPA). Community solar programs are limited to 5 MWs in New York State, and there are similar limitations in other states. One subscriber can also have no more than 40% of the project power, and we have to sign up at least 10 subscribers onto a single project. A large energy user may exceed those limitations. In those cases, we offer a similar value but within a distinct framework.
2. How is the subscription or energy valued in a Community Solar program?
Community solar subscribers support the development of large solar projects that inject power directly into the grid but do not receive power directly from the project. Instead, they receive a share of a solar project that is allocated to them (see more below for how solar project allocation works). The size of their share is calculated through the value of their bill.
Each kWh has a value assigned to it according to the state rules where the power is produced. In New York State, the energy is valued according to the value stack, also known as VDER, which uses a variety of factors to determine the specific price. For more information on the VDER credit, please take a look at this short read.
3. How is my portion of the solar project allocated to a Community Solar project?
We take into account first your utility region and the load zone (NYISO) before we assign your portion to a community solar project. After we find a suitable project that meets those primary requirements, we evaluate your energy usage to determine if there is room in the project to accommodate your needs.
We prefer to analyze around 12 months of energy usage data, which gives us the most accurate picture based on seasonal variances in usage. Analyzing only the summer months may give us an inflated understanding of your consumption. That number includes only those times when energy consumption is at a higher rate, for example, when air conditioning is running at full tilt.
Once we know what your annual energy consumption is, we assign you bill credits to offset your energy usage. That would amount to, in most cases, 100% of your bill.
4. What is the subscription sign-up process, and does it differ between businesses and individuals?
The subscription process is relatively straightforward and is based on your energy needs and utility. Once we have allocated your energy needs to a project in your utility area, you are ready to sign the subscription agreement. It’s a contract that lays out the length of the subscription in addition to cancellation terms. After you have reviewed the agreement and signed it, your subscription is set up on your end and requires no additional effort. It will automatically start as soon as the project is operational.
5. Once the subscription is active, how are the billing and other customer management inquiries handled?
There are two methods to billing, depending on your utility. Some utilities have adopted consolidated billing, which means your credits and discounts are applied directly to your utility bill and appear as a line item. You will pay the utility bill and receive your savings at the same time.
Some utilities have not yet implemented consolidated billing. In this case, you will receive two bills. On your regular utility bill, you will see the full amount of your credits applied to your energy costs to offset your share of the project. Typically, the credits have been allocated to offset 100% of your bill. The second bill comes from OYA Renewables, and this one includes payment for your credits plus the 10% savings on bill credits.
The process for subscribing to community solar is relatively the same for businesses, organizations, and residents. Where complexity comes in depends on the decision-making structure in your organization. For most households, the decision is relatively easy – the cancellation terms are friendly, and the benefits come at no cost. For businesses and other organizations, the financial benefits of community solar and its lowered risk should be an easy sell to decision-makers.
10 More Questions about Community Solar
Our community solar members asked us some questions before signing on that we thought would be helpful to answer for everyone.
6. Why is there no cost and how is community solar subscriptions free?
Community Solar programs are available in many states across the U.S.A. and transfer the cost of solar energy to developers and power producers, who build and operate large solar projects in ideal locations for generating energy from the sun. The cost of building a large solar project is less per kilowatt (kW) than for an individual business or homeowner to build, making the electricity less expensive for everyone.
In New York, community solar is a NYSERDA program and its main purpose is to encourage adoption of renewables while removing barriers that prevent businesses and households from participating in solar. One of the main barriers being the cost to install and operate solar and other renewables. You can read more about the NYSERDA program and the NY-SUN act here to help understand how community solar is free to businesses and residents in New York.
7. How long does the community solar subscription last for?
Our community solar farms stay operational for 25+ years. This means your subscription will last for the lifespan of the community solar panels. Once your subscription is active, you will be given access to OYA Renewables’ member dashboard where you can track your community solar credits and savings.
8. How does the community solar subscription work?
On your electricity bill each month, you will see the community solar credits from your subscription, also called the ‘subscription fee.’ We will match as closely as possible your electricity usage to the community solar credits you receive from our community solar program. For example, if you use $100 worth of electricity in a month, you would also generate $100 worth of community solar credits. Your savings come from us giving you up to 10% discount from those credits ($10 in savings in this example).
We make money by keeping a ‘subscription fee’ equal to the remaining credits (the $90). Essentially, we are being paid for the power we provide, while giving 10% of the value of that power back to you.
9. What will my savings be?
We aim to give our community solar members 10% of the credit their subscription generates from our community solar farm. That amount can often vary depending on their usage and the farm’s power generation. Monthly savings will vary but the annual savings will come very close to 10%, if not equal it.
10. How will I be billed?
OYA Renewables’ community Solar billing is administered by National Grid and NYSEG, under what is known as “consolidated billing.” You will receive your usual electricity bill with one added section showing your community solar credits and with your discount automatically subtracted. You will pay the utility as before with no added fees or costs – just saving from the System Benefit Charge.
11. Where is the community solar farm?
Our community solar farms are located across New York State. We will match you to the community solar program that is coming online the soonest. If you would like to find farms close to you, take a moment to view our Community Solar Projects.
12. Can I cancel my subscription if I feel community solar isn’t for me?
For residential clients, we usually ask for 2-3 months notice when canceling a community solar contract and there is no fee to cancel. For businesses, we have flexible cancellation policies to meet their needs. This is to insure a smooth transition for you and your utility company.
14. What is the environmental impact of a community Solar farm?
Because our solar farms last for over 25 years, the environmental impact is massive. Power from one solar farm is the equivalent to:
177,171 metric tons of CO2 avoided
22,317 homes powered for one year
410,187 barrels of oil used
21.5 Billion smart phones charged
Planting 2,929,531 million trees
15. How do I get started with a community solar program?
The best way is to reach out to us by filling out one of our forms online. We will then connect you with a community solar representative who will match you to a community solar program and answer any additional questions.
If you would like to learn more about community solar, contact us and we’ll answer your questions.
A community solar program is when multiple parties share the same power and financial benefits of a solar energy project. Learn all about community solar, how it works, its benefits, and the signup process.