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solar ownership
Ownership
Just as we have included a wide range of solar project types in our definition of Community Solar, so too can there be many different ownership models. Typically, the strategy employed for maximizing funding opportunities and incentives dictates (or guides) the ownership structure of a solar project.
When a community supports a cluster of individual solar installations through incentives from a utility or government entity, the resulting projects are often privately owned by home or business owners. In this simple model the power is most often net metered, and ownership of the associated Green Tags may be owned by the system owner or by one of the incentive providers.
Similar to privately owned systems (with some incentives from public funds) are small scale systems that are publicly owned in partnership with a utility program. Often utilities that collect green power funds will invest the contributions in solar installation projects on buildings that are particularly strong in serving the community. Examples include the PV installations on libraries, schools, and other education facilities through Seattle City Light’s Green Power Program.
Tax Leveraged Leasing
For commercial property owners who cannot afford the upfront cost associated with purchasing solar equipment, leasing can provide an affordable alternative. Many commercial entities like to lease equipment because a lease does not show up on the company’s balance sheet as debt. Even though a system may cost more in total over the life of a lease, as long as the lease payment is affordable on a monthly basis, commercial property owners may find leasing an attractive option. The leasing company can take advantage of all available tax benefits, which enables the company to offer more favorable leasing packages to customers (called “tax leverage leasing”).
Other Unique Models
Across the country (and the world), unique models are emerging that address community barriers to solar energy. There are creative examples of matching funds, individual donations, and investments. Examples range from companies like SunEdison, LLC that capitalize on corporate benefits of PV in order to provide solar energy at fixed costs (this company currently does not operate in Washington or Oregon), to grassroots fundraising efforts whereby concerned citizens pool their money to purchase “shares” of a community demonstration project. In Ellensburg, Washington, where they use the term “aggregate net metering” the public utility is planning the first phase (24 kW) of a larger-scale community solar installation. The installation will be paid for in part by the utility, in part by funds from the Bonneville Environmental Foundation, and in part from voluntary private investments. Ellensburg ratepayers that choose to contribute a percentage of the project’s cost will receive credit on their utility bill for a proportional amount of the energy produced by the PV array. Each contributor/customer will receive the benefits of net metering the portion of the project they funded. Ownership of the array (and the responsibilities that come with it) will remain with the utility.
