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Community Solar – How does Community Solar work & Market Size

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Community Solar

For customers wanting to enjoy solar power, yet not having the bandwidth to install solar systems, community solar is the answer. Community solar as the name suggests, entails installing solar panels together as a community and reaping its benefits.

A community solar program can be broadly classified into two categories:

i)Utility owned – where the power produced by the developers is sold to utilities. This kind of community solar program is common for municipal corporations and co –operatives.

ii)Shared solar – where investors pool in their capital/ funds together for installing a solar system and then getting tax benefits out of it, in proportion to their investment.

Shared Solar is an easier way to enjoy affordable, clean and green energy. Multiple individuals can co-own the system and get a share of the pie. The advantage of using solar power is not only its falling costs but also scalability. You have the freedom or choice of installing solar panels either the size of ultra-mega solar power plants or on your humble rooftop. Hence community solar can be built of any size, depending upon the number of participants.

You might also be interested in reading What returns can I get from a Rooftop Solar System.

Solar power usage is increasing with each day. In my view, shared solar is an excellent way to use solar power, till the time solar gets more affordable for each and every individual and it is a great option for people living in rented apartments or whose homes are not solar friendly. The below infograph excellently depicts the different ways a community shared solar program could work.

community shared solar program

Image Credit: Vox

How does Community Solar Work

After the individuals come together and build their plant, they need to contact their nearest utility or municipal office to move further. It is just like a rooftop solar system, just having community of individuals rather than a single one. The electricity generated from the solar system is fed to the grid. The utilities then give credit to the participants for their share of power produced. Some states in USA have made lucrative options to attract more participation from their residents like production based incentives, income tax credit, utility bill credits through virtual net metering (wherein the power output from the solar power plant will be proportionately shared by individuals in accordance with their ownership) or a separate payment etc. Such policies or incentives will go a long way in promoting community solar.

Many big solar companies like First Solar have promoted the concept of community solar. Not only does this program has its advantages for an individual who cannot have its own solar power plant, it also allows for economies of scale and better grid planning.

Community Solar Marketsize

Though at presently the size of community solar is small, it is expected to reach 1.5 GW in size by 2020 in USA alone, according to a report by Navigant Research. That would tantamount to $2.5 billion in revenue. USA had ~90 MW of solar power installed under this program by 2015 end.

Community Solar In India

Village Rampura in Uttar Pradesh, India was without electricity till 2008, when Community solar pilot program was run in the village. Villagers were asked to “Pay for Energy” they consumed, to sustain the program alongwith a one-time charge of just INR 500. It is really a laudable step towards electrifying rural India.


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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