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Community Solar

Identify Your Subscription/Ownership Model

Selecting a subscription model is a key part of the project management role. There are many factors you will want to assess when evaluating possible subscription models. You can use Elevate Energy’s Community Solar Business Case Tool to evaluate ownership and subscription business models. Important factors to consider include the following:

  • Value Proposition:
    • Bill credit rate–The reduction you will see on your normal bill.
    • Upfront payment–Some programs have an initial sign-up fee or require upfront payment for the panels (this requirement is most common in the direct ownership model).
    • Customer offer–Identify which subscription models save you money relative to your bill credit rate. You should choose an apples-to-apples basis comparison, such as 10 years sized to your annual electricity consumption, if the models differ in their subscription models ($/W, $/kWh, or hybrid).
    • Price-risk minimization–Do any subscription models offer price risk mitigation, such as fixing the subscription rate relative to the bill credit rate?
    • REC treatment–Identify who can take credit for the environmental benefit of the project and if they will be retired, transferred to customer, or sold to improve project economics.
  • Participation terms:
    • Consumption based limits–Because many shared solar policies are based on virtual net-metering policies, it is common that the subscription portion is limited by the subscribers’ annual electricity usage.
    • Participation requirements–This often includes a minimum credit score or down payment.
    • Subscription transferability–Best practice in community solar requires that subscribers can take their subscription with them if they move within the same utility service area, and that their subscription can be transferred to a new subscriber if they move outside their utility service area.
  • Project specifications:
    • Project size and number of subscribers–Understand how big the project will be in size (kW) had how many people the project can serve. Usually large or aggregated projects have better economic propositions. 
    • Production guarantees and warranty–Does the project provide any guarantees and warranties? This is especially important if the subscription is for a direct ownership model.
    • Subscription contract length–Understand the length of the subscription agreement.
  • Target population (e.g., LMI) subscription:
    • Are there existing carve-outs or incentives for specific target groups?
    • If not, consider using your position as a major off-taker to encourage or require that your project targets customers with low credit scores, customers who live in public housing, and/or customers who participate in other LMI-focused assistance programs.

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