As a subscriber, a city agrees to pay for a portion of the project and, in return, receives bill credits on its normal electricity bill for the produced electricity. By being a large subscriber, the city can help de-risk the project and may be able to claim the positive environmental impacts if it takes possession of the associated RECs.

There are two ways in which subscribers, are also known as off-takers, can reduce the risks for a community solar project. Developers may choose to not build a project if they are unable to attract enough subscribers or if the subscribers are not sufficiently creditworthy. To address the first concern, a city could take on the role of an anchor off-taker, in which it mitigates the risk that a project will be undersubscribed by committing to take on a large portion of the project. To address subscriber creditworthiness concerns, a city could take on the role of a flexible off-taker, in which it acts as a backstop against a project’s risk of underpayment by agreeing to take over other parties’ subscriptions in the event that they default.

Advantages

• Has the lowest complexity of the city roles
• Allows cities to negotiate lower prices, lower transaction costs, and increase subscriptions
• Can help the city meet equity and clean energy goals

Disadvantages

• Makes the city reliant on developer timelines and interests, giving the city less control
• Exposes the city to future price risk if the economics deteriorate over time
• Acting as a flexible off-taker imposes financial burdens on the city in the event that other subscribers default