US community solar market potentially huge, NREL says

Community solar could account for half of the distributed PV market in the US by 2020, according to a new report from the National Renewable Energy Laboratory (NREL).

At present, the community solar market in the US is tiny, with only several hundred megawatts of cumulative capacity in place. But that figure could grow to 11GW by 2020, and perhaps even higher, the report says.

"Shared solar" could represent 32%-49% of the distributed PV market in the US in 2020, equivalent to 5.5-11GW of cumulative capacity over the next half decade, according to the report.

There are several different models that can be classified as community solar, but the most common sees developers building small ground-mount arrays – typically between several hundred kilowatts and a few megawatts in size – and then selling fractional shares in the project, sometimes down to a single module.

Consumers see their electricity bills shrink based on the amount of power generated by their share in the community array.

Beyond the ability to appeal to consumers who do not own a home with a sunny rooftop, the “shared solar’ model has many potential advantages over rooftop solar – including better economies of scale that come with larger projects.

There are still many question marks hanging over the community solar market, including the extent to which utilities will be allowed to dominate. But there is little question that the potential is enormous.

NREL estimates that 49% of US households are unable to host a rooftop PV system – a group that includes renters and people who live in high-rise buildings. The figure for businesses is 48%.

“Shared solar presents an area of tremendous potential growth for solar photovoltaics, expanding the potential customer base to 100% of homes and businesses,” the report says.

A number of major PV companies are already moving into the community solar market, including First Solar, which has invested in the leading US player, Clean Energy Collective. Several major electric utilities, including NRG, Duke and Xcel, are also moving into the space.