Solar photovoltaic (PV) technology, which converts sunlight directly into electricity, is a priority for Massachusetts’ clean energy efforts. The environmental and economic benefits of solar energy are myriad:
- energy production from panels does not produce greenhouse gas emissions or other pollutants
- sun represents a free, available source of energy when the sun is shining, limited only by cost and the size of the array
Most of the electricity is used right where these solar electric systems sit. This localized nature of solar PV projects provides an opportunity for residents and businesses to band together and form shared solar initiatives. While the overall logistics of what is formally called “Community Shared Solar” (CSS) projects are still being hammered out, and exact details will vary on a case-by-case basis, here are some points to think about if you are considering a CSS project in Massachusetts.
First, some definitions: a CSS project is a PV system that provides benefits – such as electricity, net metering credits, and return on investment – to multiple local participants. CSS members with a suitable roof or parcel of land host these arrays and are supported by entities that invest or purchase the electricity or net metering credits. CSS offers an alternative for those who cannot install solar on their own property.
The way most Community Shared Solar projects currently operate, participants receive some form of net metering credits. Net metering allows customers of certain electric distribution companies to generate their own electricity in order to offset their electricity usage. Massachusetts investor owned utilities with eligible facilities permit customers to receive a credit from the utility company when a net metering facility like a CSS produces more power than is needed at the project site.
Currently, there are two different CSS models: “public lease” and “participant ownership.” In a public lease model, a public entity leases property – for example, a capped landfill or field – to a privately owned concern (perhaps a solar developer) that installs and operates the PV array. The private entity receives net metering credits from the solar array, which it would share with CSS participants. In the participant ownership model, a private entity (such as a limited liability company or “LLC”) owns or leases the property on which the PV system is installed. Participants in the private entity can then realize a return on their investment through net metering credits applied to their accounts.
Which model is best varies on a case-by-case basis, and each has its unique pros, cons, challenges, and benefits. The future of CSS is dynamic, so watch the DOER website for more information and guidance for Massachusetts municipalities and residents considering this emerging renewable energy option.