Small-town Projects Reflect Depth and Range of 2016’s Community Solar Boom

2016 was the year that community solar became seriously cool — by which I mean it was widely embraced as a means to increase access to solar and its many benefits for utilities, consumers, solar developers and society in general.

Certainly, the proliferation of programs and projects — aka, the community or shared solar boom — has been one of defining trends of the solar and utility industries this year. New community solar projects represented 20 percent of the nonresidential, commercial solar market in the third quarter of 2016, with a record 75 megawatts (MW) going on line, according to data from GTM Research and the Solar Energy Industries Association.

One measure of the depth and range of this pipeline can be seen in the small towns and utilities — often in states with minimal solar growth to begin with — starting to explore the possibility of a first community solar project. The Smart Electric Power Alliance (SEPA) has been tracking such projects for the past two years as part of a U.S. Department of Energy-funded study aimed at providing utilities and their communities with the information and tools they need to make such projects successful.

Get the SEPA-Shelton Group report, “What Community Solar Customers Want,” here.

More recently, we’ve also been working with utilities in these small towns — such as Fremont, Nebraska and the Village of Minster, Ohio — as they reach out to their residents to gauge interest in community solar and how such projects should be designed. What we see, in both places, is the shift that is occurring across the country as utilities begin to approach solar development not as a threat, but as an opportunity to create stronger bonds with their customers and spur economic growth in their communities.

The experiences of Fremont and Minster may provide other communities with examples of how to take the first steps. In both cases, SEPA helped the towns’ municipal utilities with initial market surveys and follow-up.

Fremont, Nebraska: From cornhuskers to community solar

A community of 26,500 residents about a half-hour west of Omaha, Fremont, Nebraska is admittedly not a hub of solar market growth.

“We are not California. We don’t currently have any utility-scale solar and only one customer-sited system — 6.5 kilowatts,” said Brian Newton, General Manager at the Fremont Department of Utilities (FDU).

However, SEPA’s market survey found that FDU’s 12,000 residential and 1,600 commercial customers are eager for solar. Seventy percent of survey respondents said they were interested in community solar.

But they also were concerned about reducing their community’s dependence on non-local fuel sources — often a big issue for small town utilities that must buy their power from larger suppliers. So, while many market surveys find that financial savings or environmental benefits are the chief priorities for consumers interested in community solar, the results in Fremont told FDU that its customers wanted local developers and financing for their project.

Finding those partners has been a challenge, Newton said. It also raises a bigger question about the fundamental nature of community solar. Is a program with all local partners and built on the same distribution lines as its subscribers the same — truly community-oriented — as a project built at a remote site, with West Coast developers and East Coast investors?

I am not even going to attempt to answer that question here, but the Fremont experience does underline how community and, therefore, utility priorities can vary.

Luckily, SEPA was able to connect FDU with the Nebraska Public Power District (NPPD), a neighboring utility that had also begun exploring community solar options and wanted to use local companies and financing for the project.

“It was helpful to find NPPD had struggled with similar problems. They had some great recommendations for partners that we pursued.” Newton said.

Now that the project team is assembled, the next substantial challenge will be educating and engaging the customer base in Fremont. The SEPA survey found that — their interest in community solar notwithstanding — 35 percent of potential subscribers also said the greatest obstacle to their participation was “not understanding how the program works.”

In fact, SEPA’s research over the past two years shows that educating consumers about how community solar works is a core need for most programs. As part of our Department of Energy-funded work, we will be producing an educational infographic and video that will be available for free to utilities and communities in the coming year.

Minster, Ohio: From small town to solar innovator

The Village of Minster and its 2,850 residents have had a busy 2016. Earlier this year, the town unveiled an innovative solar-plus-storage project — with 4.2 MW of solar and 7 MW of storage — and has been racking up awards ever since.

The town’s small municipal utility was named SEPA’s 2016 Public Power Utility of the Year and was also No. 1 on our Top 10 list of utilities that added the most solar watts per customer in 2015. Other honors include Green Energy Ohio’s Clean Community of the Year Award and, most recently, Renewable Energy World’s Renewable Project of the Year Award.

Find out more about the Minister’s solar-plus-storage project here. 

Still, many in the population aren’t satisfied with solar constituting “just” 20 percent of their generation. SEPA’s survey here found that 93 percent of respondents were interested in community solar.

To meet this demand, Minster had originally planned to build a community solar project of about 500 kilowatts (kW) to 1 MW But the cost for solar projects of this size in Ohio can be substantial — the state’s clean energy targets have been frozen for two years and may remain so. Going with a project of 2 MW or larger could cut costs — and Minster’s leaders saw an opportunity to leverage the community solar plan for economic development.

Beyond its growing reputation as a solar innovator, the village is also home to the largest Dannon yogurt factory in the nation. The company has expressed interest in building a distribution center here and wants the facility to be powered with renewable energy as part of its goal of running 100 percent on renewables by 2020, according to Village Administrator Don Harrod.

“Partnering with Dannon (on the community solar program) allows us to build a larger project and gain economies of scale, reducing participation costs to residential subscribers,” he said.

The town is now planning a 3-MW community solar project to break ground in the spring of 2017. It will give the town more than 7 MW of solar to help meet its summertime peak demand of 23 MW, Harrod said. In other words, Minster could soon be supplying close to 30 percent of its peak demand with solar — a rare achievement for many U.S. utilities, with the exception of solar-saturated Hawaii.

The Department of Energy wants to help more communities repeat the progress of Fremont and Minster through its recently announced Solar in Your Community Challenge. The 18-month competitive program will award $5 million in cash prizes and technical assistance to communities across the country developing shared solar projects that expand access to solar for their underserved populations.

SEPA is also continuing to offer technical assistance — including market research — for utilities seeking help with community solar projects. For more information, contact Dan Chwastyk, Utility Strategy Manager, at [email protected].